TaxTMI 
TaxTMI 
2018 (2) TMI 1937
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....ng the impugned disallowance as well as assessee's submissions as under: "5.1.0 I have carefully considered the submission of the appellant and perused facts of the case in A.O's order. Ground No.1, 2 & 3 are basically arising out of the grievance from the A.O's action of denying higher depreciation on vehicles on the proposition that appellant is not in the business of running vehicles on hire. The undisputed fact is that appellant is civil contractor and has undertaken contract/sub-contract of road-making. It utilised certain vehicles, i.e. tractors/JCB machines/concrete mixtures/hydraulic jacks etc. while discharging its own contractual obligations and claimed depreciation @ 15% and simultaneously also carried out transportation work for others utilising separate vehicles, i.e. tractors/JCB machines/concrete mixtures/hydraulic jacks etc. and claimed depreciation @ 30% with the understanding that these vehicles have been put to use for transport business. The said argument was not accepted by the A.O. basically because of following reasons :- 1. There was no separate income from hire / freight and thus it cannot be said that appellant is also in the busi....
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....jarat shall be arranged by the Contractor FREIGHT: Extra @ Rs. 145/- PMT shall be to Buyer's account WORK DESCRIPTION: Contractor (M/s. Bhimji Vekli Sorathia)shall carry out the job work as per the following. (a) shall unload the iron ore from lorries being received at their site for crushing. (b) shall crush the iron ore lumps supplied by Buyer for making of iron ore fines at his own crusher at Adipur to desired size given in the specification and load the material to dumpers. (c) shall ensure crushing of a minimum 150-200 MT on daily basis. However, Buyer shall make allout efforts to make available maximum quantity possible for crushing. (d) shall ensure not receiving of any other material inside the crushing yard during contract period of Jindal Saw Limited. Buyer may nominate two persons to supervise the crushing operation at the crusher site. (e) shall submit all the chalans, permits, seeler's weighment slip and receiver's weighment slip and any other documents received during receiving of iron ore lumps from the suppliers to Buyer's representative on daily basis for their necessary record and accou....
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....are eligible for higher rate of depreciation. The next question is that whether the assets were actually, given on hire or were used in the business of hiring. I have attended to this point in detail in the forgoing paragraphs and elaborated earlier, after duly considering all the facts and evidences. The above referred discussion has convinced me that the assets were actually given on hire or were used in the business of running them on hire. The assets which are otherwise eligible for higher rate of depreciation can claim that higher rate only if they are actually used in an activity which involves transportation of "something." Thus, the next duty on me is to ascertain as to whether the assets which were decided to have been hired by the appellant (as concluded herein above) were actually put to use for activity which had in itself the attributes of transportation of something. I am of the opinion that the issue is that of fact and fact only when I am entrusted with the task of deciding the actual use to which the asset is put to. The assets were "given on hire " by the appellant and were "taken on hire" or "hired" to some of the entities and hence it were thos....
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....ope whatsoever to speculate whether the same were used in the business of the appellant. It is absurd to think that one will hire one's assets to a "third party" in order to carry out "one's own business operation." Thus, I am quite clear in my mind that facts of the case clearly point to a situation that the assets were not used in appellant's own business. Business transaction involved here is that the appellant has given certain of his assets on hire to certain third parties and those third parties have put those assets to use in such activities which did have the characteristics of transportation attached to them. Finally, on the basis of the perusal of the assessment order passed by the learned AO, the submission of the Appellant and the evidences produced before me by the appellant, I have come to the conclusion that; 1. That the assets (equipments / vehicles) in question were basically of the nature on which higher rate of depreciation is allowable, subject to fulfillment of specified conditions 2. The business of the appellant did consist of "giving equipments / vehicles on hire 3. The equipment / vehicles were given on hire by the app....