TaxTMI 
TaxTMI 
2019 (6) TMI 1343
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....ce, the appeals were heard together and are disposed of by this common and consolidated order. The common grounds raised by the Revenue in all these appeals are as under: "1. The CIT (A) erred in directing to allow depreciation @ 30% on plant & machinery instead of eligible rate of 15%. 2. CIT (A) erred in interpreting the definition of the commercial vehicles as defined in Entry III-(3)(II) of Appendix-I of the Income Tax Rules. 3. The CIT (A) erred in not appreciating that facts of M/s. NAC Infrastructure Equipment Ltd are difference from the facts of the present case and that the revenue did not prefer further appeal in the said case in ITA No.464/Hyd/2015 dated 6.7.2016 because of low tax effect.....
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....nsideration, the assessee claimed depreciation @30% on crane, chasis, motor graders, wheel loaders, soil compactors, JCBs, concrete boom placers given on hire. At the outset, it is humbly submitted that as per Entry-III-(3)(ii) of Appendix-I of the I.T. Rules "Motor buses, motor lorries and motor taxis used in a business of running them on hire" are eligible for depreciation @30%". 3. The AO however, was not convinced with the above reply and held that the term "commercial vehicle" has been clearly defined in the Notes to the Table of Rates of Depreciation admissible in the Appendix to Income Tax Rules and since the assets leased by the assessee are used for the specific purpose of construction and are not the commercial vehicle as defin....
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....n the case of Gujco Carriers Vs. CIT [256 ITR 50] (Guj.) wherein, 'motor lorries' were explained to include fire trucks, forklift trucks and crane trucks which are designed for special services. Assessee also relied on various decisions of the ITAT to justify that claim of 40% allowed by the AO in the original assessment is correct and restriction by the AO to 25% is not according to the provisions of law. Ld. CIT(A) allowed assessee's claim by stating as under: "9. The submissions of the assessee, the factual position as brought out by the Assessing Officer in the assessment order and the documents placed on record are considered. It is seen that though the motor graders and wheel loaders are not depicted as motor vehi....
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....r the provisions of law. Moreover the wheel loaders and Graders are Motor vehicles and is certainly eligible for depreciation at 40% as per schedule and the case law on the subject. In view of this, I do not see any reason to interfere with the well reasoned order of the CIT(A), both on the issue of reopening and as well as allowance of depreciation at 40% on wheel loaders. For these reasons, I uphold the order of CIT(A) and reject the grounds of Revenue. 6. Thus, it can be seen that the Revenue's appeal was not dismissed on low tax effect but was disposed on merits. Further, we also find that the Hon'ble Gujarat High Court in the case of Gujco Carriers vs. CIT (2002) 256 ITR 50 (Guj.) has considered the expression "motor lorr....
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....erfere with the order of the CIT (A). Therefore, the Revenue's appeals are dismissed. 9. As regards the Cross Objection filed by the assessee for the A.Y 2014-15 in ITA No.858/Hyd/2016, we find that the assessee has raised the following grounds of appeal: "1. That on the facts and in the circumstances of the case, the learned CIT (A) (herein after referred to as learned CIT (A) erred in confirming disallowance of claim of leave encashment on provision basis amounting to Rs. 4,50,247/- in computing total income. 2. That on the facts and in the circumstances of the case, the learned CIT (A) was not justified and grossly erred in confirming ad-hoc disallowance of labour expenses to the tune of Rs. 5,00,000/-. ....
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....um of Rs. 4,83,53,000/- claimed in the earlier A.Y 2013-14. Observing that the expenditure claimed is not in proportion to the turnover declared for the A.Ys 2013-14 and 2014-15 respectively, the AO disallowed 5% of the labour charges. On appeal, the CIT (A) restricted the disallowance to Rs. 5.00 lakhs and the assessee is in cross objection before us. 13. The learned Counsel for the assessee submitted that the assessee is maintaining books of account and the books have not been rejected by the AO but the disallowance was made. On appeal, the CIT (A) restricted the disallowance to Rs. 5.00 lakhs. The learned Counsel for the assessee submitted that the AO could not have made the disallowance without rejection of the books of accoun....