TaxTMI 
TaxTMI 
2009 (1) TMI 504
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....prima facie adjustment under section 143(1)(a) can be made in respect of depreciation claimed at 40 per cent. in terms of item III(2)(ii) of Appendix I to the Income-tax Rules, 1962, and any such adjustment would be beyond the scope of the power conferred by section 143(1)(a) ? (c) Whether and in any event the depreciation at 40 per cent. is admissible in respect of leased motor trucks/lorries used in the business of running them on hire and the Tribunal was justified in law in disallowing the appellant's claim ?" 2. The facts of this case, as they appear briefly, are that the assessee- company is engaged in the business of leasing out motor trucks and lorries. The assessee-company received lease rent from the lessee....
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....he order of Assessing Officer that the assessee is not entitled for higher rate of depreciation on the leased vehicles/ lorries. 3. Mr. J. P. Khaitan, learned advocate appearing in support of this appeal pointed out that the said decision was, in fact, decided without hearing the assessee since the assessee did not appear, although the matter appeared before the Bench on a number of occasions. He tried to point out that the assessee could not place the facts before the Bench when the Bench considered the decision of the Tribunal and came to the conclusion in Soma Finance and Leasing Co. Ltd. [2000] 244 ITR 440 (Cal). 4. In the instant case, the Department did not appear before us and the tables have been turned. We have gran....
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....t the asset should be used for the purpose of the assessee's business and the entry under the Appendix refers to the user it should be put to. Once it is accepted that the leasing out of the vehicles is one of the modes of doing business by the assessee and, in fact, the income from such leasing is treated as business income of the assessee, it would be clearly contradictory in terms to hold that the vehicles in question were not used wholly for the purpose of the assessee's business and the assessee is bound to get the benefit under such Appendix I and thereby should get the benefit of receiving the percentage of depreciation at higher rate which is specified in the said entry at 40 per cent. 6. Consequently it appears to us that a specia....
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....red opinion, differ from the principle laid down by the said decision and furthermore, the decision of this High Court has also been taken note of by the Delhi High Court and the said order has also been confirmed by the Supreme Court and we have to take note of that in deciding the question after placing such facts on record the Supreme Court indirectly affirmed the order so passed by the Delhi High Court in Bansal Credits Ltd. [2003] 259 ITR 69. Therefore, in our considered opinion, the questions which are to be answered in this matter have to be in favour of the assessee and we do not find that there is any reason to differ from the decision of the Delhi High Court taking into account the facts and circumstances of this case and accordin....