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Samarth Lifters Pvt. Ltd. Versus Addl. CIT, Range-3, Thane, Thane (W)

2017 (12) TMI 644 - ITAT MUMBAI

Disallowance of depreciation on Crawler Cranes and Dozers - entitled for depreciation @ 15% and not @ 30% as claimed by the assessee - Held that:- It is not possible to include each and every type of vehicle in the depreciation schedule. Due to rapid industrialization, the various types of machines used in transport business are increasing day after day with each machine carrying out a particular type of activity in a more efficient manner. These machines do not find direct representation in the .....

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013 (5) TMI 965 - SUPREME COURT) have analyzed the definition of the term motor vehicle to hold even a tractor to be motor vehicle as it is capable of being adapted to run on public roads. - Thus no merit in action of lower authorities for declining higher claim of depreciation at 30% on Crawler Cranes and Dozers. - Decided in favour of assessee. - ITA No.1781/Mum/2015 - Dated:- 8-12-2017 - SHRI R.C.SHARMA, AM AND SHRI RAM LAL NEGI, JM For The Assessee : Shri Subodh Ratna Parakhi For The Rev .....

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e crawler cranes, dozers etc. on hire. During the course of scrutiny assessment the AO disallowed the depreciation to the extent of ₹ 9,18,44,052/- holding that crawler cranes and dozers were plant and machinery entitled for depreciation @ 15% and not @ 30% as claimed by the assessee. The assessee has claimed these vehicles to be motor lorries‟ used in the business of running them on hire and therefore entitled for higher depreciation. The Hon‟ble CIT(A) has confirmed the disal .....

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eal. The order of the Hon‟ble Tribunal granting higher depreciation on cranes in the assessee‟s own case therefore became final. Copies of the relevant orders are also placed on record. 6. We have gone through the orders to the authorities below as well as the order of ITAT and Hon‟ble High Court wherein appeal filed by the revenue is dismissed as withdrawn. On merits, as per entry III(3)(ii) of Part A of Appendix I to I.T.Rules 1962, motor buses, motor lorries and motor taxies .....

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held crawler cranes / dozers to be plant & machinery entitled for depreciation @ 15% and not motor vehicles entitled for depreciation @ 40%. 7. So far as nature of assets is concerned we found that a crawler crane is a crane having a power plant like a motor vehicle which runs mostly on a diesel engine which sufficient power / torgue and other features of a motor vehicle like cooling systems, starter, radiator, throttle with sufficient fuel tank capacity. Normally, the crawler crane has hydr .....

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mandatory for claiming depreciation. The term motor vehicle has not been defined under the Income Tax Act 1961. Accordingly, we have to rely on the definition of the said term as contained in Sec. 2(28) of the Motor Vehicles Act 1988. The term motor vehicle as per the said act reads as under. Sec.2(28) Motor vehicles , or Vehicle means any mechanically propelled vehicle adopted for use upon roads whether the power of propulsion is transmitted thereto from an external or internal source and incl .....

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d (adapted) then it is sufficient to categorize such vehicle as a motor vehicle. (copy of relevant page of Motor Vehicles Act, 1988 is enclosed at pg no.90&90 of paper book so filed before us). Registration of the vehicle under the Motor Vehicle Act, 1988 is not the requirement for claiming higher depreciation. Appendix I of IT Rules or Section 32 of the I.T.Act 1961 does not mandate that a vehicle should be registered under the Motor Vehicles Act, 1988 for claiming higher depreciation. 10. .....

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registration under the Motor Vehicles Act, 1988 is misplaced for declining higher claim of depreciation. 12. The crawler cranes / dozers were not permanently registered under the Motor Vehicles Act, 1988 due to the fact that these vehicles through capable are not piled on public roads. The vehicles are deployed in port / factory premises and therefore do not require permanent registration under the Motor Vehicles Act, 1988. In the course of asst. proceedings, it was further explained that even t .....

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Vehicle department permitted operation of the crawler cranes on public roads also for the given period of time. The assumption made by the ld.AO that such fees are some sort of entry tax is factually in-correct. The copes of RTO tax paid receipts for crawler cranes to operate in Gujarat are at pg nos. 12 to 18 of paper book. A certificate from Govt. Approved RTO consultant, M/s.Sama Auto Consultant explaining the nature of tax paid appears at pg. No.19 of paper book. It is thus the case that un .....

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Due to rapid industrialization, the various types of machines used in transport business are increasing day after day with each machine carrying out a particular type of activity in a more efficient manner. These machines do not find direct representation in the depreciation schedule. In such situation, the functional similarly with the nature of activity performed by the listed machine has to be done to determine under what category a particular machine would fall. 14. We also found that CBDT v .....

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