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TMI Blog2008 (1) TMI 914X X X X Extracts X X X X X X X X Extracts X X X X ..... e under section 44AE of the Act. The contention of the assessee is that JCB is analogous to goods carrier and the provisions of section 44AE are applicable. The Assessing Officer rejected the contention of the assessee as in the opinion of the Assessing Officer JCB is an earth mover machinery used for excavation of earth, lifting of heavy material, etc., in the process of construction and hence, it cannot be equated with goods carrier like lorries and trucks and/computations made by the assessee applying the provisions of section 44AE are not correct. The Assessing Officer computed the assessee's income under the normal provisions rejecting the contention of the assessee that income is to be computed under section 44AE. 4. The assessee challenged the action of the Assessing Officer before the CIT(A). The CIT(A) was of the opinion that provisions of section 44AE postulates to tax the income on presumptive basis in respect of goods carriages which are engaged in the business of plying, hiring and leasing and JCBs which are used for excavation of earth and lifting of heavy materials are coming into the category of earth moving machineries and not goods carriages by any stretch of ima ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 40. (4) The written down value of any asset used for the purpose of the business referred to in sub-section (1) shall be deemed to have been calculated as if the assessee had claimed and had been actually allowed the deduction in respect of the depreciation for each of the relevant assessment years. (5) The provisions of sections 44AA and 44AB shall not apply in so far as they relate to the business referred to in sub-section (1) and in computing the monetary limits under those sections, the gross receipts or, as the case may be, the income from the said business shall be excluded. (6) Nothing contained in the foregoing provisions of this section shall apply, where the assessee claims and produces evidence to prove that the profits and gains from the aforesaid business during the previous year relevant to the assessment year commencing on the 1-4-1997 or any earlier assessment year, are lower than the profits and gains specified in sub-sections (1) and (2), and thereupon the Assessing Officer shall proceed to make an assessment of the total income or loss of the assessee and determine the sum payable by the assessee on the basis of assessment made under sub-section (3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00 × 10) + (Rs. 1,800 × 9) + (Rs. 1,800 × 12), i.e., ₹ 55,800. Illustration (2) : An assessee owns a heavy goods vehicle for 9 months 7 days, a medium goods vehicle for 9 months and a light commercial vehicle for 12 months during the previous year. His profits and gains from the three trucks shall be deemed to be (Rs. 2,000 × 10) + (Rs. 1,800 × 9) + (Rs. 1,800 × 12), i.e., ₹ 57,800. 32.2 The estimated income is comprehensive. All deductions under sections 30 to 38 including depreciation, will be deemed to have been already allowed and no further deduction will be allowed under these sections. The written down value will be calculated, where necessary, as if depreciation as applicable has been allowed. In the case of firms, the normal deductions to the extent allowed under clause (b) of section 40 will be allowed. 32.3 An assessee who files the return, estimating income on the basis of the specified amount per truck or estimating a higher income, will neither be required to maintain books of account under the provisions of section 44AA, nor required to get accounts audited under the provisions of section 44AB, in respect of his i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese v. ITO [1981] 13I ITR 597. In the said case, Their Lordships held as under :- ". . . These two circulars of the CBDT are, as we shall presently point out, binding on the tax department in administering or executing the provision enacted in sub-section (2), but quite apart from their binding character, they are clearly in the nature of contemporanea expositio furnishing legitimate aid in the construction of sub-section (2). The rule of construction by reference to contemporanea expositio is a well-established rule for interpreting a statute by reference to the exposition it has received from contemporary authority, though it must give way where the language of the statute is plain and unambiguous. This rule has been succinctly and felicitously expressed in Crawford on Statutory Construction, 1940 Edn., where it is stated in paragraph 219 that "administrative construction (i.e., contemporaneous construction placed by administrative or executive officers charged with executing a statute) generally should be clearly wrong before it is overturned; such a construction, commonly referred to as practical construction, although non-controlling, is nevertheless entitled to c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... functions of lorry as after removing the earth, it carries the earth and dumps at another site. The further argument of the learned counsel is that removing the earth is not the only function and carrying of earth is also the function and the function which is otherwise carried by motor lorries. 15. In the case of Gujco Carriers (supra), the issue before the Hon'ble High Court of Gujarat was whether crane mounted cm motor truck is entitled for depreciation at 40 per cent or 30 per cent. After exhaustively interpreting the provisions of Motor Vehicles Act and the relevant Appendix in respect of the rates of depreciation, it was held that mobile crane, which is registered as a heavy motor vehicle clearly falls within the expression "motor lorries" (which means motor trucks) and hence are eligible for depreciation at 40 per cent. The interpretation given by the Hon'ble High Court of Gujarat to the expression "motor lorries" is as under :- "12. The origin of word 'lorry' is uncertain. 'Lorry' means, (i) 'a large strong motor vehicle for transporting goods, etc.', (ii) 'a long flat low wagon', or, (iii) 'a truck used on railways or tramways', as per the Conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia Britannica :- 'Industrial truck carrier is designed to transport materials within a factory area with maximum flexibility in making moves. Most industrial trucks permit mechanized pickup and deposit of the loads, eliminating manual, work in lifting as well as transporting. Depending on their means of locomotion, industrial trucks may be classified as hand trucks or power trucks. Hand trucks with two wheels permit most of the load to be carried on the wheels, but some of the load must be assumed by the operator to balance the truck during movement. Common two-wheel hand trucks include the barrel, box, drum, hopper, refrigerator, paper-roll, and tote-box trucks. Four-wheel hand trucks are found in many more varieties, including dollies, high and low-bed flat trucks, carts, rack carriers, wagons, and various hand-lift trucks having mechanical or hydraulic lifting mechanisms for raising and lowering a load. Power trucks are' propelled by batteries and an electric-motor or by an internal - combustion engine with either a mechanical drive or a generator and electric-motor drive. Propane and diesel engines are used in place of gasoline engines on some types. The non-lift platfor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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