THE BUSINESS OF PLYING , LEASING OR HIRING TRUCKS
With effect from the assessment year 1994-95, section 44AE has
been inserted with a view to providing for a method of estimating income
from the business of plying, hiring or leasing trucks.
- The salient features of the scheme are given below :The scheme
applies to a person owning not more than 10 goods carriages. For this purpose,
an assessee who is in possession of a goods carriage, whether taken on hire
purchase or on instalments and for which the whole or part of the amount
payable is still due, shall be deemed to be the owner of such goods carriages.
- The income from each goods carriage being a “heavy goods vehicle” will be estimated at Rs. 3,500 for every month or part of a month during which
the goods carriage is owned by the assessee. The income from each goods carriage,
other than a heavy goods vehicle will
be estimated at Rs. 3,150 for every month or
part of a month during which the goods carriage is owned by the assessee.
In either case, the taxpayer can declare his income from trucks at a higher
amount than that specified above.
- For this purpose “goods carriage” means any motor vehicle constructed
or adapted for use solely for the carriage of goods, or any motor vehicle
not so constructed or adapted when used for the carriage of goods; and “heavy
goods vehicle” means any goods carriage the gross vehicle weight of which,
or a tractor or a road-roller the unladen weight of
either of which exceeds 12,000 kilograms.
- For instance, an assessee owns a light commercial vehicle for 9
months and 6 days, a medium goods vehicle for 10 months and a medium goods
vehicle for 12 months during the previous year. His profits and gains from
the three trucks shall be deemed to be (Rs. 3,150 ×10) + (Rs. 3,150
× 10) + (Rs. 3,150 × 12), i.e., Rs. 1,13,400/-
- If an assessee owns a heavy goods vehicle (weight exceeding 12,000
kg.) for 9 months and 5 days, a medium goods vehicle for 10 months and 10
days and a light commercial vehicle for 6 months during the previous year.
His profits and gains from the three trucks shall be deemed to be (Rs. 3,500
× 10) + (Rs. 3,150 × 11) + (Rs. 3,150 × 6), i.e., Rs. 88,550/-
- The estimated income is comprehensive. All deductions under sections
30 to 38 including depreciation will be deemed to have been already allowed
and no further deduction will be allowed under these sections. However, in
the case of a firm, the normal deduction under section 40(b) shall be allowed.
The written down value will be calculated, where necessary, as if depreciation
as applicable has been allowed.
- The assessee will neither be required to maintain books of
account under the provisions of section 44AA, nor required to get his accounts
audited under the provisions of section 44AB, in respect of his income from
truck business. However, even such an assessee should comply with the requirements
of both sections 44AA and 44AB in respect of his businesses which are not
covered by this scheme.
Income from the truck business, estimated in accordance with this
provision, will be aggregated with other incomes of the assessee, from any
other business or under other heads of income, in accordance with the normal
provisions of the Act. Accordingly, all deductions under sections 80CCC to
80U and rebate under sections 88 and 88B will be available to the assessee,
if the conditions therein are fulfilled.