Depriciation rate on earth moving machineries
This query is : Resolved
06 March 2010
Please tell me the depriciation rate on earthmoving machinery;
and with reference to the case Sibson Construction & Co. v/s Commissioner of Income Tax; what would be the depriciation rate on :
1) Dumper - if it is used for the purpose of making road
2)Dumper - If it is used for carrying marble blocks; i.e. for minning purposes.
Please do reply earliest as its quiet urgent.
and with reference to the case Sibson Construction & Co. v/s Commissioner of Income Tax; what would be the depriciation rate on :
1) Dumper - if it is used for the purpose of making road
2)Dumper - If it is used for carrying marble blocks; i.e. for minning purposes.
Please do reply earliest as its quiet urgent.
06 March 2010
Nilesh Shah Replies:
For and from A.Y 2006-2007 the Appendix to Income-tax Rules does not have seperate entry for equipment such as
Dumper, Earth Moving Machinery, Mining machinery etc.
Therefore based on the functional test, whether the dumper is used for making roads or for the purpose of mining, it will fall under the heading
" Machinery and Plant other than those covered by sub-items (2),(3) and (8) below" and will be entitled to depreciation @ 15%.
The case which you are referring to is CIT v Sibson Construction and Co 221 ITR 468 (Gauhati) is concerning A.Y 1984-1985 where the present Appendix was not there.
I hope the above shall clarify the issue.
Sincerely,
Nilesh Shah
For and from A.Y 2006-2007 the Appendix to Income-tax Rules does not have seperate entry for equipment such as
Dumper, Earth Moving Machinery, Mining machinery etc.
Therefore based on the functional test, whether the dumper is used for making roads or for the purpose of mining, it will fall under the heading
" Machinery and Plant other than those covered by sub-items (2),(3) and (8) below" and will be entitled to depreciation @ 15%.
The case which you are referring to is CIT v Sibson Construction and Co 221 ITR 468 (Gauhati) is concerning A.Y 1984-1985 where the present Appendix was not there.
I hope the above shall clarify the issue.
Sincerely,
Nilesh Shah
08 March 2010
thank you very much sir,
but what would be the rate of depriciation if we are using dumpers for making roads.
please do reply earliest sie as its quite urgent
but what would be the rate of depriciation if we are using dumpers for making roads.
please do reply earliest sie as its quite urgent
08 March 2010
Nilesh Shah Replies:
It will be @ 15%. On and from A.Y 2006-2007 there is no category as a Dumper. It is only as machinery that it will depreciate.
Sincerely,
Nilesh Shah
It will be @ 15%. On and from A.Y 2006-2007 there is no category as a Dumper. It is only as machinery that it will depreciate.
Sincerely,
Nilesh Shah
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