Wear and Tear or negligence on water heater

[Russ Wiese]

I'm working on returning a security deposit and am having a hard time deciding what to do with damage to a water heater.  I'm hoping those with more experience can shed some light on the decision.  

Purchased property two years ago and had a home inspection and natural gas water heater worked good and was complete.  Tenants check out at the end of July and natural gas gets turned off because I didn't have a continuous service agreement with utility company at the time.  Go to re-light water heater after gas was turned back on and the plastic knob on top of the gas valve where pilot light is turned on is missing.  Repair company says they can't get part and need new valve.  So $525 later I'm wondering if I should take that out of the security deposit or eat it as "wear and tear".  It was there when they moved in.  

Thanks in advance