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TMI Blog2015 (10) TMI 2740X X X X Extracts X X X X X X X X Extracts X X X X ..... ks for removal of earth to make him entitled for higher rate of depreciation, as removal and transportation of earth are only sub-processes of his main business of laying of roads. The order of CIT (A) entitling the assessee for higher rate of depreciation on the premise that his motor vehicles were used for removal of earth and since the earth did not belong to the assessee, therefore, the use of his motor vehicles was on hire, in the opinion of this Court, is not correct, either on facts or in law, besides not being in conformity with the test laid down by the Apex Court in Gupta Global Exim (P) Ltd.[2008 (5) TMI 7 - SUPREME COURT] and also, with the Board's Circular No.609/Circular No. 652 dt. 14/6/93. - Decided in favour of revenue. X X X X Extracts X X X X X X X X Extracts X X X X ..... As the assessee was engaged in the business of civil construction, only 15% depreciation i.e. ₹ 9,39,312/- was allowable and not 30% i.e. ₹ 18,78,623/-. Hence, the balance was added to the income of the assessee as excess claim of depreciation. 4. On appeal, the CIT (Appeals) allowed the claim of depreciation at the rate of 30% for the reason that the appellant was required to transport the earth from one place to another for filling. Since the earth so transported did not belong to the appellant and as such the appellant's business receipts to a large extent could be held to be price or the charges received for transporting the goods from one place to another, referring to CBDT's Circular No.652 dated 14/6/1993, higher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les for its own business of transporting its goods only 30 per cent depreciation was allowable." 6. Being aggrieved thereby, the assessee is before us by filing the instant appeal under Section 260A of the Act. Appendix I, relevant for assessment year 2008-2009, inter alia, under sub-item 3(ii) of Item III, provides for higher (30%) rate of depreciation allowance as percentage of written down value of motor buses, motor lorries and motor taxis used in the business of running them on hire, allowable under Section 32 of the Act. The aforesaid clause has been clarified by Board's Circular No.609 dated 29/7/1991 (S.No.244) reproduced in Circular No. 652 dated 14/6/1993, that where a tour operator or travel agent uses motor buses or motor t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee for higher rate of depreciation on the premise that his motor vehicles were used for removal of earth and since the earth did not belong to the assessee, therefore, the use of his motor vehicles was on hire, in the opinion of this Court, is not correct, either on facts or in law, besides not being in conformity with the test laid down by the Apex Court, as indicated above, and also, with the Board's Circular No.609/Circular No. 652 dt. 14/6/93 (Supra). 9. In the case of Gaylord Constructions (Supra) the question raised in appeal filed by the Revenue was "whether the Tribunal was justified in upholding the assessee's claim for depreciation of earth moving equipment, namely, JCB at the rate of 40%; the rate provided for ' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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