9911796707
TMI Blog1990 (11) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... Manjeet Stone Company, Kota, is carrying on the work of quarrying and sale of stones excavated from mines and derives its income from this business. The assessee owns trucks which are used mainly for carrying the stones from the quarry to the sales depot or to the godown of the assessee. The trucks are registered as "public carriers". For the assessment year 1981-82, the assessee claimed depreciation on these trucks at the rate of 40%. The Income-tax Officer allowed depreciation at the rate of 40% as claimed by the assessee. The Commissioner of Incometax initiated proceedings under section 263 of the Income-tax Act against the assessee and, after giving notice to the assessee under section 263, set aside the order passed by the Income-tax O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontinuous activity. He has further submitted that no specific finding has been given by the Tribunal on the point that the assessee was engaged in the business of hiring. The finding of the Commissioner on that point that the assessee was not carrying on the business of hiring the trucks has not been set aside by the Tribunal and, therefore, the assessee is entitled to depreciation only at 30% and not at the rate of 40%. Learned counsel for the assessee, on the other hand, has submitted that the trucks in question were registered as "public carriers" and as such they can be used for hiring purposes also. In fact, the trucks are being used for personal use as well as for hiring purposes in taking the goods of the various purchasers from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al for the opinion of the High Court, many of the arguments advanced by counsel for the parties need not to be considered because the question which has been referred is limited to the question, where the truck is used in its business by the assessee, at which rate depreciation is admissible. The question which, therefore, requires consideration is : whether the assessee is entitled to depreciation at 40% or 30% on the trucks used by it in its business ? Rates at which depreciation is admissible have been provided in the "Depreciation Table" given in Appendix-I, Part-I, of the Income-tax Rules, 1962. In the Table of Rates of Depreciation, there are two entries relating to motor buses and motor lorries which provide the "Rate of depreciatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of running them on hire are entitled to depreciation at 40%. If a truck is not used for hiring but for the purpose of one's own business, then it would be entitled to depreciation at 30% and not 40%. The context of the relevant entry does indicate the same. In the present case, the business of the assessee is that of mining and sale of stones excavated from the mines and the trucks are used mainly for its business of mining. They are used mainly for carrying the stones from the mine-site to the sales depot or to the godown of the assessee. If the trucks are used for its own business, then they are entitled to depreciation at 30% only, as the assessee was not using the trucks in the business of running them on hire. The registration of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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