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TMI Blog1962 (2) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... a written agreement dated April 29, 1952, he paid the consideration of ₹ 1,25,000. He took delivery and possession of the buses on April 30, 1952, and began to operator them himself. In the income-tax assessment proceedings for the year 1953-54 he claimed depreciated in respect of these buses on the sum of ₹ 1,25,000 which according to him represented his original cost of acquisition of the vehicles. The Income-tax Officer, Vellore, noted the fact that the buses were all of old model, 3 of the year 1942, 3 of the year 1946, 3 of the year 1947 and one of the year 1950. He was of opinion that the sum of ₹ 1,25,000 could not represent the value of the vehicles alone, but that some part of that amount must represent the value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Tribunal for rectification of its order under section 35 of the Indian Income-tax Act. The contention of the assessee was that the figure of ₹ 60,000 mentioned in the order of the Tribunal as presenting the route value was a mistake for ₹ 20,000. He claimed that the original cost of the vehicles for the purpose of depreciation allowance should be fixed at ₹ 1,05,000. In dealing with this application the Tribunal observed that it did not intend to increase the "route value" from ₹ 40,000 to ₹ 60,000, that it was not the object of the Tribunal to give relief to the assessee diminishing the route value from ₹ 40,000 to a lower figure, but conceded that the order partly allowing the appeal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld be taken as the value of the vehicles and vehicles alone, as it is not permissible under the Motor Vehicles Act to transfer permits for pecuniary consideration. We must observe that there is a fallacy in this argument. A permit is defines under section 2(xx) of the Motor Vehicles Act as a document issued by a State or Regional Transport Authority authorising the use of a transport vehicle as a contract carriage or as stage carriage. Section 59 of the Act states that a permit shall not be transferable from one person to another except with the permission of the transport authority which granted the permit and it also states that no person to whom the permit is transferred shall have any right to use the vehicle without such permission. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erived by operating on the route. In the instant case we cannot say that the department went wrong in allowing depreciation only on the amount of ₹ 85,000 as representing the value of the vehicles deducting ₹ 40,000 representing the "route value" from the total consideration of ₹ 1,25,000.
The answer to the question is as follows: The Tribunal acted erroneously in fixing the route value at ₹ 60,000 but the error has been rectified and corrected. The decision of the Tribunal affirming the decision of the department fixing the route value at ₹ 40,000 cannot be said to be unsupported by the materials on record. There will be no order as to costs.
Order accordingly. X X X X Extracts X X X X X X X X Extracts X X X X
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