Commr.Of Income Tax,Gujarat vs Gupta Global Exim (P) Ltd

The Gujarat High Court held that the respondent-assessee was not entitled to claim a higher rate of depreciation at 40% on trailers and loaders as the authorities below failed to apply the correct test under sub-item 2(ii) of Item III of Appendix I to the Income-tax Rules, 1962. The Court emphasized that the mere inclusion of transportation income in the total business income does not determine the nature of the business. The Court found that the assessee was primarily engaged in timber trading and not in the business of running trucks on hire, thus reversing the findings of the CIT(A) and Tribunal.