TMI Blog2010 (7) TMI 652X X X X Extracts X X X X X X X X Extracts X X X X ..... he instant case, the Tata, JCB and 400V wheel loaders are covered within the expression “motor lorries” which are used in business of running them on hire and the AO had correctly allowed the claim of depreciation u/s. 32 in the sum of Rs. 78,05,251/- applying the rate of 30% - Appeal is allowed - ITA No. 586/Kol./2010 - - - Dated:- 16-7-2010 - G.D. AGRAWAL, VICE PRESIDENT AND D.K. TYAGI, JUDICIAL MEMBER Somnath Ghosh for the Appellant. B.N. Varma for the Respondent. ORDER This appeal preferred by the assessee is directed against the order of the Ld. CIT, Kolkata dated 01.02.2010 for the assessment years 2006-07 passed u/s. 263 of the I. T. Act. 2. Briefly stated facts of the case are that the assessee is a partn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us as well as prejudicial to the interest of revenue for allowing the claim of depreciation without any examination in respect of the pay loaders at the rate of 30% as against the allowable rate of 15%. He also submitted that the assessee owns Tata, JCB and 400V are mainly Dumpers/Excavators, Crane mounted vehicles and Vehicles fitted with construction equipments registered as Heavy or Medium Motor Vehicles with the Regional Transport Officer under the omnibus category of vehicles and they are used in the business of hiring them out to others and as such eligible for depreciation @ 30% as per entry no. III(3)(ii) of Part A of Appendix I of the Income Tax Rules, 1962 as motor buses, motor lorries and motor taxis used in a business of runn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r moving them, horizontally. The crane truck is a portable boom crane mounted on an industrial truck. It may be used with clearing grabs and hooks for deposit and lifting and moving of materials. These trucks come within the meaning of expression of motor lorries as described in the Encyclopaedia Britannica. It was his contention that motor vehicles like fire fighting truck, crane trucks etc. designed for special services fall within the category of motor trucks also including motor lorries . Crane is any of a diverse group of machines that not only lift heavy loads but also shift them horizontally. The fork lift truck widely used for moving goods from one place to another is also a motor vehicle. Goods carriage as defined in s. 2(14 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . III(3)(ii) of Part A of Appendix I of the Income Tax Rules, 1962 and as such entitled to depreciation @ 30% as allowable in case of motor lorries since they were used in the business of running them on hire which was considered in the proper perspective by the AO and the action of the Ld. CIT of issuing direction to restrict the depreciation @ 15% in the order passed u/s. s. 263 is unlawful in the circumstances and respectfully prayed before the Bench to quash the same. 4. On the other hand, the Ld. DR vehemently supported the order of the Ld. CIT and urged before the Bench to uphold such action which, according to him, is well within the four corners of law. 5. After a careful analysis of the arguments advanced by both the parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore clearly falls within the ambit of the expression Motor lorries appearing in entry no. III(3)(ii) of Part A of Appendix I of the Income Tax Rules, 1962 since they are used in the business of hiring them out to others. They are fitted with diesel engines, hydraulic brakes and pneumatic tyres. These are four wheeled multi-utility vehicles used for excavation of earth and movement of the same is limited within short distances. These are not used as transport vehicles but they are used in excavation of earth and movement of the same, though for limited distance and the machine is also used to level and shape the land. We also find that the Apex Court in the case of Bose Abraham vs State of Kerala supra has held that the excavators and roa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is fortified with the decision of the Hon ble Gujarat High Court in the case of Gujco Carriers vs CIT supra wherein it was held that a mobile crane which is registered as a heavy motor vehicle with the RTO would clearly fall within the expression motor lorries in entry IIIE(1A) of Table in Appendix I under rule 5 of the Income Tax Rules, 1962 since it is used in he business of running the crane on hire and as such entitled to depreciation @ 40%. Similarly, in the case of CIT vs Gaylord Constructions supra it was held that the earth moving equipment, JCB, which are used on hire for excavation of soil are utilized equally for transport of the excavated soil or other loads for a limited distance and therefore it serves as a transport equip ..... X X X X Extracts X X X X X X X X Extracts X X X X
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