TMI Blog2013 (8) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... Per B.R.BASKARAN, Accountant Member: The appeal filed by the assessee is directed against the order dated 10-12-2012 passed by the Ld. CIT(A), Trivandrum and it relates to the assessment year 2008-09. 2. The appeal is barred by limitation by 05 days. The assessee has filed a petition requesting the Bench to condone the delay in filing the appeal on the reasoning that the appellant was suffering from fever during that period. We also heard the Ld. DR on this point. Having regard to the submissions made by the assessee in the petition filed, we condone the delay and admit the appeal for hearing. 3. The solitary issue urged in this appeal is whether the Ld. CIT(A) is justified in confirming the order of the Assessing Officer in denying a higher rate of depreciation on the vehicles used for transporting assessee s own goods. 4. The facts relating to the said issue are stated in brief. The assessee is engaged in the business of running a quarry, wherein the rock boulders are blasted and crushed into pieces by using stone crushers, screened and thereafter they are loaded into lorry/tractor for transporting to the Customer places. The major customer of the assessee is Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdingly, contended that these vehicles are eligible for a higher rate of depreciation. The Ld. Counsel placed reliance on the following paragraph of Circular No. 609 dated 29/07/1991 issued by CBDT:- Therefore where a tour operator or travel agent uses such vehicles owned by him, in providing transportation service to the tourists, higher rate of depreciation should be allowed on such vehicles. The Ld A.R also placed reliance on the decision rendered by Hon ble Madras High Court in the case of CIT Vs. Stanes Tyres and Rubber Ltd (242 ITR 619), wherein it was held that higher rate of depreciation is allowable for motor vehicles used for hire or reward. Accordingly, the Ld A.R contended that the assessee is entitled for higher rate of depreciation, as he is in the business of transportation of metal and was also collecting transportation charges. 6. On the contrary, the Ld. DR submitted that the higher rate of depreciation is admissible only to those vehicles which are used in the business of running them on hire. In the instant case, the assessee is not carrying on any business of running the vehicles on hire but used them only in his business for transporting the goods deal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and not the material owned by some one else. The vehicles are used as per the requirement ascertained by the appellant himself. The control over the vehicles remains with the appellant. Under these circumstances, it cannot be said that the vehicles were given on hire to Railways or Public. The reliance placed by the appellant on the observations of the Hon ble Supreme Court that the true test is the user of the same in the business of the assessee of transportation is misplaced. What the Hon ble Supreme Court has said is that the vehicles should be used in the business of transportation of the assessee i.e.. the business of assessee should be transportation. Since in this case the assessee is not in the business of transportation and transportation of metal is just incidental to the business of sale of metal to Railways/Public, the reliance placed by the appellant is not correct. During the appellate proceedings as noted vide order sheet entry dated 26-11-2012, the Council of the appellant stated that no vehicle was given on hire to any party. In view of the above, it is held that assessee is not in the business of running of vehicles on hire . 8. Admitted facts are that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10. In the instant case, the assessee s business is supplying metals obtained from the quarry owned by him. According to the contract entered with Railways, the assessee is required to supply the metals at the place specified in the Contract. Thus, as observed by Ld CIT(A), it is the responsibility of the assessee to transport the metals to the place specified by the Railways. Since the assessee was required to transport the metals to different places, it was advantageous for both the assessee as well as for the Railways to fix a price for the metals and to fix transport charges separately. Hence, the transportation of metals in the vehicles owned by the assessee is part of the business carried on by the assessee, viz., operating a quarry and supplying crushed metals. Hence, we agree with the view expressed by the Ld. CIT(A) that the transportation is incidental to the business of sale of metal to Railways/public. Accordingly, we concur with the view of Ld CIT(A) that the assessee was not engaged in the business of running the vehicles on hire. 11. We notice that a similar view has been expressed by the Hon ble Madhya Pradesh High Court in the case of Kailash Chand Bagaria V ..... X X X X Extracts X X X X X X X X Extracts X X X X
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