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NEUTRAL CITATION

C/TAXAP/782/2025 ORDER DATED: 19/12/2025

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higher rate of depreciation @30% without appreciating the fact

that if the vehicle/dumpers were given on hire, then the assessee

must have earned income from hiring out of these equipment’s?

(C) Whether the decision of Appellate Tribunal is perverse as it

has failed to appreciate that the fact that the assessee has shown

its entire receipt from mining work contract considering that the

assessee is engaged in the business of mining for which assessee is

getting payment on ‘per ton’ basis rather than on monthly basis or

based on number of trips as is the case for giving the lorries on

hire thus revealing the contractual nature of work?”

3 The identical questions of law which were proposed in

Tax Appeal No. 1008 of 2024, this Court has held thus:

“3 Learned advocates for both the sides i.e. Mr.Karan Sanghani

for the appellant – Revenue and Mr.S.N.Divatia for the respondent

has categorically submitted that the issue is no more res integra as

the issue is squarely covered by the decision of this Court for the

same respondent in Tax Appeal No. 414 of 2018. The relevant

paragraphs of the said decision read as under:

“Section 32 [1] of the Income-tax Act, 1961 ["the Act" for

brevity] provides for depreciation in respect of buildings,

machinery, plant or furniture, being tangible assets as well

as certain intangible assets owned wholly or partly by the

assessee and used for the purpose of the business or

profession, at the prescribed rates. New Appendix 1, which

is applicable for AY 2006-2007 and onwards, in Part-A

contends specific rate of depreciation for "tangible assets".

Capital-III thereof pertains to "machinery and plant". Under

sub-item [2] of Item [3] (iii), the rate of depreciation on

"motor buses, motor lorries and motor taxis used in the

business of running them on hire" is prescribed @ 30%. It is

in this context, we have to test the correctness of the view

taken by CIT [A] and the Tribunal. Revenue's main

contention appears to be that the assessee had not given the

said machinery on hire since the assessee was awarded the

contract for mining. However, we have noticed some of the

leading terms of the tender. These terms inter alia required

the assessee to provide machinery for hire for excavation of

overburden, transportation of such excavated overburden

minerals, transportation of minerals from mines to pit-head,

stock piles or at any other place, and the transportation of

overburden of minerals and excavated minerals to be done

by running motor vehicles such as tippers, dumpers, etc.

Essentially, therefore, the assessee was awarded contract

for providing such equipments on hire. It was in this context,

the assessee has highlighted that the assessee has no control

over the equipments so hired and it was the principal which

would decide to deploy the equipments at the appropriate

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NEUTRAL CITATION

C/TAXAP/782/2025 ORDER DATED: 19/12/2025

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place

From the material available on record though the

assessee essentially was awarded contract for providing

specialized equipments and trained manpower for mining

and transportation of excavated minerals on hire, the terms

of the tender and the eventual contract awarded would

suggest that the assessce was given the work of mining. The

assessee was essentially required to provide equipments and

manpower on hire. In view of such discussion, we find no

error in the view taken by the Tribunal. Even if the assessee

had used such equipments and manpower for its direct

mining operations for the contract, if it was so awarded, we

wonder whether that would make any difference particularly

in view of CBDT Circulars No. 609 and 652 and the decision

of the Supreme Court in case of I.C.D.S Limited v.

Commissioner of Income-Tax & Anr., reported in [2013] 350

ITR 527 (SC). However, when this issue does not arise for

direct consideration, we need not c