Law:

Section:

Section 32 of the Income-tax Act, 1961, read with heading/Entry III E(1A) of Part I of Appendix I to the Income-tax Rules, 1962 - Depreciation - Allowance/rate of - Assessment year 1982-83 - Whether mobile crane mounted on motor truck used in business of running it on hire and registered as a heavy motor vehicle, would fall within expression 'motor lorries' in heading/Entry III E(1A) of Part I of Appendix I and hence, be entitled to depreciation at 40 per cent - Held, yes FACTS The assessee purchased a mobile crane and while filing its returns claimed depreciation at the rate of 40 per cent on the ground that the crane was registered as motor vehicle and was used in the business of running on hire and so it would fall under heading/Entry III E(1A) of Part I of Appendix I to the Income-tax Rules, 1962. However, the Assessing Officer by simply stating that 'crane is not included therein', disallowed the assessee's claim which was upheld by the Commissioner (Appeals). On second appeal, the assessee further contended that the CBDT by its instructions had granted benefit of depreciation to a fork-lift truck and as it was also a type of crane, the depreciation was to be allowed. But the Tribunal negatived the assessee's claim and also held that it was not shown as to how a crane was similar to a fork-lift truck to which depreciation was allowed. On reference : HELD 'Lorry' or 'truck' would mean not only any motor vehicle designed to carry freight or goods but also to perform special services like fire fighting. Fire engine, also called fire-truck, is a self-propelled mobile piece of equipment used in fire fighting. There can be other special services to be performed by motor vehicles designed for such services. Thus, a lorry, i.e., truck adapted or designed to carry a crane, is meant for special services of lifting load, moving it side by side, rotating it or moving it horizontally. Most industrial trucks permit mechanized pick-up and deposit of the loads, eliminating manual work in lifting as well as transporting. The crane truck is a portable boom crane mounted on an industrial truck. It may be used with hooks, grabs and slings for bundled or coiled material.…

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