TaxTMI 
TaxTMI 
TaxTMI 
Earth Moving Machines (like JCB) treated as Asset or Vehicle
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....arth Moving Machines (like JCB) treated as Asset or Vehicle<br> Query (Issue) Started By: - Mathurthi RamKumar Dated:- 15-2-2016 Last Reply Date:- 17-2-2016 Accounting - Auditing<br>Got 8 Replies<br>Companies Law<br>Dear All, Greeting of the day..Kindly clarify my doubt..earth moving machine - JCB treated as vehicle or asset in a manufacturing unit. Regards M.RamKumar Reply By Mahir S: The Re....
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....ply: Sir, You have not elaborated nor specified the reason of your query. However, the functioning and operation of a JCB machine cannot be equated either with a motor lorry or a motor truck. The JCB machine invariably falls within the scope of a particular type of machinery for the sole purpose of excavation of soil/earth which comes under the purview of 'Plant and Machinery' (Assets)....
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.... and so the applicable rate of depreciation in respect of JCB machines shall accordingly be based on its being 'Plant and Machinery' (Assets) and not based on it being as a Vehicle; as seems to be your indirect query. In view of above, you are therefore eligible to claim lesser amount of depreciation under the category of Assets rather than under Vehicles. Reply By Mathurthi RamKumar: Th....
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....e Reply: Dear Sir, Thank you for quick reply. I am working in a power plant and we also have Kraft paper manufacturing unit. We are using a JCB in for both plants. like lifting of raw material and coal etc... Hope my doubt is clear. Regards M.RamKumar Reply By Mahir S: The Reply: Sir, The definition of `motor vehicle' from the Motor Vehicles Act, 1988 (MV Act) as per the MV Act is as ....
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....follows: "Motor vehicle or vehicle means any mechanically propelled vehicle adapted for use upon roads...; but does not include ... .a vehicle of a special type adapted for use only in a factory or in any other enclosed premises... " Further, Earth moving machinery is primarily used in the infrastructure sector. It is also a fact that the JCB Earth Movers are not been registered as hea....
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....vy motor vehicles (like Mobile Cranes) with the Regional Transport Authorities. .T he Income-Tax Act also had made a distinction between earth moving machinery and motor vehicles. Hence, the fact that in your case that JCB is also being used for lifting of raw material and coal etc. shall not changed its identity. Therefore, there is no change in the views expressed in my above reply, as the le....
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....gal position on the issue is already settled. Reply By MARIAPPAN GOVINDARAJAN: The Reply: In my view also JCB will not come under the definition of ''vehicle' and therefore it is to be considered as Plant and Machinery. Reply By KASTURI SETHI: The Reply: I am thankful to both experts, Sh.Mahir S and SH. MARIAPPAN GOVINDARAJAN, Sir. Really your views have enriched my knowledge.Conce....
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....pt is clear to me know. Reply By YAGAY AND SUN: The Reply: Dear Mathurthi Ramkumar You may find this judgment useful 2010 (12) TMI 913 - ITAT, Bangalore Magtron Earth Movers Versus ITO Reply By Mahir S: The Reply: Thanks M.Govindarajanji and K. Sethiji for the endorsement and appreciation of my views. Reply By KASTURI SETHI: The Reply: Thanks to M/S.YAGAY AND SUN for providing case law in ....
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....support of the contention of the experts. It is really useful.<br> Discussion Forum - Knowledge Sharing ....