Profits and benefits from the business of plying, hiring, or leasing goods carriages are subject to a special provision.
S-44AE of IT Act, 1961
The income of an assessee who owns up to 10 goods carriages and is engaged in the business of plying, hiring, or leasing such goods carriages is liable to tax under section PGBP, notwithstanding anything contained in sections 28 to 43C.
How Do You Calculate Gains?
- I For large goods vehicles (with a gross vehicle weight exceeding 12 tonnes) – Rs. 1000 per tonne of gross vehicle weight/unladen weight (for each month/part of a month OR the amount actually received from such vehicle, whichever is higher.
- For non-heavy goods vehicles (up to 12 tonnes) – Rs. 7500 per month (or portion of a month) OR the amount actually generated from such goods carriage, whichever is greater.
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Sections 30 to 38 provide for deductions that are presumed to be permissible, but no further deductions are allowed under those sections.
If the assessee is a corporation, the pay and interest paid to its partners are deducted from the income computed, subject to the requirements and restrictions set forth in S – 40. (b).
The WDV of any asset is deemed to have been calculated as if the assessee sought and was really given the depreciation deduction for each of the relevant assessment years.
Though the assessee is not required to keep books, he must compute WDV of FA and keep FA records for each fiscal year.
S-44AA (audit) and 44AB (keeping of books of accounts) do not apply.
If the assessee keeps and maintains such books of account (S-44AA) and has his accounts audited u/s 44AB, he may be able to claim reduced earnings.
An assessee who is in possession of a goods carriage, whether purchased on hire purchase or in instalments, and for which the entire or a portion of the sum due is still owing, is deemed to be the owner of the goods carriage.
Even if the assessee chooses this provision, he will still be obligated to pay advance tax.
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