N.D.Joseph vs The Commissioner Of Income Tax on 11 January, 2010

       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

ITA.No. 672 of 2009()


1. N.D.JOSEPH,
                      ...  Petitioner

                        Vs



1. THE COMMISSIONER OF INCOME TAX,COCHIN.
                       ...       Respondent

                For Petitioner  :SRI.P.BALAKRISHNAN (E)

                For Respondent  :SRI.JOSE JOSEPH, SC, FOR INCOME TAX

The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR
The Hon'ble MR. Justice V.K.MOHANAN

 Dated :11/01/2010

 O R D E R
                     C.N.RAMACHANDRAN NAIR &
                                V.K.MOHANAN, JJ.
                ....................................................................
                          I.T. Appeal No.672 of 2009
                ....................................................................
                Dated this the 11th day of January, 2010.

                                       JUDGMENT

Ramachandran Nair, J.

We have heard Adv. Sri.P.Balakrishnan appearing for the

appellant and Standing Counsel appearing for the respondent. Of the

three issues raised in the appeal filed by the assessee, we notice that the

first two pertain to estimation of income under various heads which got

modified by the two appellate authorities. We do not find any

substantial question of law arising in regard to estimation of income

under two items covered by question numbers 1 and 2.

2. The next question raised pertains to assessee’s claim for higher

rate of depreciation on tipper trucks and JCB mainly used for own

business and partly let out to other parties. Counsel for the appellant

submitted that occasional letting out of the tipper trucks and JCB

entitles the assessee for higher rate of depreciation under Item 3 of

Appendix I of the Depreciation Schedule under Rule 5 of the Income

Tax Rules. However, we notice that higher rate of depreciation is

available for motor bus, motor trailers and motor taxies used in the

2

business of running them on hire. Even though counsel for the

assessee has relied on decision of Supreme Court in COMMISSIONER

OF INCOME-TAX VS. GUPTA GLOBAL EXIM P. LTD. reported in

(2008) 305 ITR 132, we do not think the decision of the Supreme Court

supports assessee’s case because in that case the claim of the assessee

was that besides trading in timber, assessee was letting out the truck on

hire. On the other hand, in this case assessee being a contractor has

used the equipments namely, tippers and JCB for his own business and

occasionally the items were let on hire earning hire charges. We are of

the view that in order to entitle for higher rate of depreciation, the main

use of the vehicles should be to let on hire and not to use in assessee’s

own business. Since the items were predominantly used in assessee’s

own business, we feel assessee is entitled to depreciation only at

normal rate which is granted. Consequently appeal is dismissed.

C.N.RAMACHANDRAN NAIR
Judge

V.K.MOHANAN
Judge
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