|
Section 44AE_Chaos of Heavy Goods Vehicle Owners
CA Raghavendra Prasad M. B.Com.FCA,AIII,DISA,FIV,AIIISLA,CCCAB,DRA,CAAT,ISO9001-2000,COC,LNIAR,MSME,FAFD,IT Regd. Valuer.
Section 44AE : Special provision for computing profits and gains of business of plying, hiring or leasing goods carriages.
GoI , MoF , DoR , CBDT F. No. 225/233/2019/ITA-II dated 14th August, 2019.
Urgent clarification to All India Motor Transport Congress, in the context of amendment made in sub-section (2) of section 44AE of the Act vide Finance Act, 2018 w.e.f. 01.04.2019. (i) Gross Vehicle Weight ( which include un-laden weight of the vehicle and the payload laden weight).
(ii) Un-Laden Weight i.e., Weight of the Empty Vehicle
OR
(iii) Laden Weight ( Payload)
As per clause (aa) under Explanation.- at the end of Section 44AE , ‘Heavy Goods Vehicle’ means any goods carriage, the gross vehicle weight of which exceeds 12000 Kilograms.
As per clause (a) of the same the definition of ‘Gross Vehicle Weight’ or ‘Unladen weight’ or
‘Goods carriage’ will be as per the definition in the Motor Vehicle Act,1988.
The Motor Vehicles Act,1988 defines the said terms as below:
Section 2(14) , “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.
Section 2 (13) “ gross vehicle weight” means in respect of any vehicle the total weight of the vehicle and load registered by the registering authority as permissible for that vehicle.
Section 2(48) “unladen weight” means the weigjht of a vehicle or trailor including all equipments ordinarily used with the vehicle or trailor when working but excluding the weight of a driver or attendant and where alternative parts or bodies are used the unladen weight of the vehicle means the weight of the vehicle with the heaviest such alternative part or body.
In this regard , it is relevant to note the definition ( emphasis added by me )“ Heavy Goods Vehicle” in the Income Tax Act is different ( emphasis added by me ) from the definition of said term in the Motor Vehicles Act,1988. The definition of the said term as per the Motor Vehicles Act,1988 is as below:
Section 2(16) “heavy goods vehicle” means any goods vehicle carriage the gross vehicle weight of which or a tractor or a road-roller the unladen weight of which exceeds 12,000 kilograms.
Conclusive para 6 : The above definitions make it clear that the assesses will have to compute the profits and gains of business under section 44AE of the Act on the basis of above definitions . It means that in respect of a “ heavy goods vehicle” i.e., all goods carriage vehilcles whose gross vehicle weight exceeds 12,000 kilograms , the profits and gains from each goods carriage for the purposes of section 44AE Act shall be at rate of Rs 1,000/- per ton of gross vehicle weight for every month or part of the month. However, in respect of a tractor or a road-roller, where the gross vehicle weight is not applicable , and unladen weight exceeds 12,000 Kilograms , the profits and gains from each goods carriage for the purposes of section 44 AE of the Act shall be at the rate of Rs 1,000/- per ton of unladen weight for every month or part of the month.
All of the above can be explained to an asesseee , by way of an illustration, as follows:
A heavy goods vehicle whose Gross Vehicle Weight ( which include un-laden weight of the vehicle and the payload laden weight). The un-laden weight is 13000 kilograms , the payload laden weight is 15000 kolograms (Total 25000 kilograms) and owned for All 12 months.
1.As per (i) referred supra owned, the profits and gains would be 25X12X 1,000 = Rs 3,00,000/- only.
2. As per a commercial law publisher’s 15th edition of 2023 , it was 13X12X1000 = Rs 1,56,000/-
3. As per the handbook on Direct Taxes 24th edition of 2025 , it is 25X12X1000 = Rs 3,00,000/-
4. As per the Direct Taxes Ready Reckoner ,49 the edition A.Y’s 2025026 & 2026-27 , it is
25X12X1000= Rs 3,00,000/-
I request the Tax Professionalss , to be awre and to consider GoI , MoF , DoR , CBDT F. No. 225/233/2019/ITA-II dated 14th August, 2019 before computation of profits and gains of business of plying, hiring or leasing goods carriages w.e.f 01.04.2019 and accordingly advise the clients to comply with the latest law and pay due taxes as responsible citizens of India.
Section 44AE_Chaos of Heavy Goods Vehicle Owners
CA Raghavendra Prasad M. B.Com.FCA,AIII,DISA,FIV,AIIISLA,CCCAB,DRA,CAAT,ISO9001-2000,COC,LNIAR,MSME,FAFD,IT Regd. Valuer.
Section 44AE : Special provision for computing profits and gains of business of plying, hiring or leasing goods carriages.
GoI , MoF , DoR , CBDT F. No. 225/233/2019/ITA-II dated 14th August, 2019.
Urgent clarification to All India Motor Transport Congress, in the context of amendment made in sub-section (2) of section 44AE of the Act vide Finance Act, 2018 w.e.f. 01.04.2019. (i) Gross Vehicle Weight ( which include un-laden weight of the vehicle and the payload laden weight).
(ii) Un-Laden Weight i.e., Weight of the Empty Vehicle
OR
(iii) Laden Weight ( Payload)
As per clause (aa) under Explanation.- at the end of Section 44AE , ‘Heavy Goods Vehicle’ means any goods carriage, the gross vehicle weight of which exceeds 12000 Kilograms.
As per clause (a) of the same the definition of ‘Gross Vehicle Weight’ or ‘Unladen weight’ or
‘Goods carriage’ will be as per the definition in the Motor Vehicle Act,1988.
The Motor Vehicles Act,1988 defines the said terms as below:
Section 2(14) , “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.
Section 2 (13) “ gross vehicle weight” means in respect of any vehicle the total weight of the vehicle and load registered by the registering authority as permissible for that vehicle.
Section 2(48) “unladen weight” means the weigjht of a vehicle or trailor including all equipments ordinarily used with the vehicle or trailor when working but excluding the weight of a driver or attendant and where alternative parts or bodies are used the unladen weight of the vehicle means the weight of the vehicle with the heaviest such alternative part or body.
In this regard , it is relevant to note the definition ( emphasis added by me )“ Heavy Goods Vehicle” in the Income Tax Act is different ( emphasis added by me ) from the definition of said term in the Motor Vehicles Act,1988. The definition of the said term as per the Motor Vehicles Act,1988 is as below:
Section 2(16) “heavy goods vehicle” means any goods vehicle carriage the gross vehicle weight of which or a tractor or a road-roller the unladen weight of which exceeds 12,000 kilograms.
Conclusive para 6 : The above definitions make it clear that the assesses will have to compute the profits and gains of business under section 44AE of the Act on the basis of above definitions . It means that in respect of a “ heavy goods vehicle” i.e., all goods carriage vehilcles whose gross vehicle weight exceeds 12,000 kilograms , the profits and gains from each goods carriage for the purposes of section 44AE Act shall be at rate of Rs 1,000/- per ton of gross vehicle weight for every month or part of the month. However, in respect of a tractor or a road-roller, where the gross vehicle weight is not applicable , and unladen weight exceeds 12,000 Kilograms , the profits and gains from each goods carriage for the purposes of section 44 AE of the Act shall be at the rate of Rs 1,000/- per ton of unladen weight for every month or part of the month.
All of the above can be explained to an asesseee , by way of an illustration, as follows:
A heavy goods vehicle whose Gross Vehicle Weight ( which include un-laden weight of the vehicle and the payload laden weight). The un-laden weight is 13000 kilograms , the payload laden weight is 15000 kolograms (Total 25000 kilograms) and owned for All 12 months.
1.As per (i) referred supra owned, the profits and gains would be 25X12X 1,000 = Rs 3,00,000/- only.
2. As per a commercial law publisher’s 15th edition of 2023 , it was 13X12X1000 = Rs 1,56,000/-
3. As per the handbook on Direct Taxes 24th edition of 2025 , it is 25X12X1000 = Rs 3,00,000/-
4. As per the Direct Taxes Ready Reckoner ,49 the edition A.Y’s 2025026 & 2026-27 , it is
25X12X1000= Rs 3,00,000/-
I request the Tax Professionalss , to be awre and to consider GoI , MoF , DoR , CBDT F. No. 225/233/2019/ITA-II dated 14th August, 2019 before computation of profits and gains of business of plying, hiring or leasing goods carriages w.e.f 01.04.2019 and accordingly advise the clients to comply with the latest law and pay due taxes as responsible citizens of India.
|
