Rates of Income Tax - Arora & Joshi Chartered Accounts

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Utilities

RATES OF DEPRECIATION UNDER THE COMPANIES ACT

SCHEDULE XIV (Sec. 205 and 350)

W.D.V %

S.L.M %

Buildings (other than factory buildings) [NESD]

1.63

Factory Buildings

3.34

Purely Temporary Erections (such as wooden structures)

100

II. Plant and Machinery

General rate applicable to,

a) plant and machinery (not being a ship) other than continuous process plant for which no special rate has been prescribed under (ii) below

Single Shift
Double Shift
Triple Shift

13.91
20.87
27.82

4.75
7.42
10.34

b) continuous process plant, other than those for which no special rate has been prescribed under (ii) below (NESD)

15.33

5.28

ii)

Special rates

Cinematograph films - Machinery used in the production and exhibition of cinematograph films [NESD] -

7.07

Recording equipment, reproducing equipment, developing machines, printing machines, editing machines, synchronisers and studio lights except bulbs

Projecting equipment of film exhibiting concerns

Cycles [NESD]

7.07

Electrical machinery, X-ray and electrotherapeutic apparatus and accessories thereto, medical, diagnostic equipments, namely, Catscan, Ultrasound Machines, ECG Monitors etc. [NESD]

7.07

Juice boiling pans (karhais) [NESD]

7.07

Motor-cars, motor cycles, scooters and other mopeds [NESD]

25.89

9.5

Electrically operated vehicles including battery powered or fuel cell powered vehicles [NESD]

7.07

Sugarcane crushers (indigenous kolhus and belans) [NESD]

7.07

Glass manufacturing concerns except direct fire glass melting furnaces - Recuperative and regenerative glass melting furnaces

Single Shift
Double Shift
Triple Shift

20
30
40

7.07
11.31
16.21

Machinery used in the manufacture of electronic goods or components

Single Shift
Double Shift
Triple Shift

15.62
23.42
31.23

5.38
8.46
11.87

Aeroplanes, aeroengines, simulators, visual system and quick engine change equipment [NESD]

16.2

5.6

Concrete pipes manufacture Moulds [NESD]

11.31

Drum container manufacture Dies [NESD]

Earth-moving machinery employed in heavy construction works, such as dams, tunnels, canals, etc. [NESD]

Glass manufacturing concerns except direct fire glass melting furnaces - Moulds [NESD]

Moulds in iron foundries [NESD]

Mineral oil concerns - Field operations (above ground) - Portable boilers, drilling tools, well-head tanks, rigs, etc. [NESD]

Mines and quarries - Portable underground machinery and earth-moving machinery used in open cast mining [NESD]

Motor buses and motor lorries other than those used in a business of running them on hire [NESD]

Motor tractors, harvesting combines [NESD]

10.

Patterns, dies and templates [[NESD]

11.

Ropeway structures - Ropeways, ropes and trestle sheaves and connected parts [NESD]

12.

Shoes and other leather goods factories - Wooden lastsused in the manufacture of shoes.

Single Shift
Double Shift
Triple Shift

30
45
60

11.31
18.96
29.05

Motor buses, motor lorries and motor taxies used in a business or running them on hire [NESD]

16.21

Rubber and plastic goods factories - Moulds [NESD]

Data processing machines including computers [NESD]

Gas cylinders including valves and regulators [NESD]

Artificial silk manufacturing machinery wooden parts

100

Cinematography films - Bulbs of studio lights

Flour mills - Rollers

Glass manufacturing concerns - Direct fire glass melting furnaces

4A.

Float Glass Melting Furnaces (NECD)

Iron and Steel industries - Rolling mill rolls

100

Match factories - Wooden match frames

Mineral oil concerns -
a) Plant used in field operations (below ground) - Distribution - returnable packages
b) Plant used in field operations (below ground) but not including assets used in field operations (distribution) - Kerbside pumps including underground tanks and fittings

Mines and quarries -
a) Tubs, windings ropes, haulage ropes and sand stowing pipes
b) Safety lamps

Salt works - Salt pans, reservoirs and condensers, etc., made of earthy, sandy or clay material or any other similar material

10.

Sugar works - Rollers

III

Furniture and Fittings -

General rates [NESD]

18.1

6.33

Rate for furniture and fittings used in hotels, restaurants and boarding houses; schools, colleges and other educational institutions, libraries; welfare centres; meeting halls, cinema houses; theatres and circus; and for furniture and fittings let out on hire for use on the occasion of marriages and similar functions [NESD]

25.88

9.5

Ships -

Ocean-going ships -

i) Fishing vessels with wooden hull [NESD]

27.05

ii) Dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes [NESD]

19.8

iii) Other ships [NESD]

14.6

Vessels ordinarily operating on inland waters -

i) Speed boats [NESD]

7.07

ii) Other vessels [NESD]

3.34

W.D.V. : Written Down Value
S.L.M. : Straight Line Method

Notes:

"buildings" include roads, bridges, culverts, wells and tube-wells.
"factory building" does not include offices, godowns, officers' and employees' quarters, roads, bridges, culverts, wells and tube-wells.
"speed boat" means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometres per hour in still water and so designed that when running at a speed it will plane; i.e. its bow will rise from the water.
where, during any financial year, any addition has been made to any asset, or where any asset has been sold, discarded, demolished or destroyed, the depreciation on such assets shall be calculated on a pro rata basis from the date of such addition or, as the case may be, up to the date on which such asset has been sold, discarded, demolished or destroyed.
The following information should also be disclosed in the accounts :
1. depreciation methods used; and
2. depreciation rates or the useful lives of the assets, if they are different from the principal rates specified in the Schedule.
The calculations of the extra depreciation for double shift working and for triple shift working shall be made separately in the proportion which the number of days for which the concern worked double shift or triple shift, as the case may be, bears to the normal number of working days during the year. For this purpose, the normal number of working days during the year shall be deemed to be -
1. in the case of a seasonal factory or concern, the number of days on which the factory or concern actually worked during the year or 180 days, whichever is greater;
2. in any other case, the number of days on which the factory or concern actually worked during the year or 240 days, whichever is greater. The extra shift depreciation shall not be charged in respect of any item of machinery or plant which has been specifically, excepted by inscription of the letters "NESD" (meaning "No Extra Shift Depreciation") against it in sub-items above and also in respect of the following items of machinery and plant to which the general rate of depreciation of 13.91% applies -
  1. Accounting machines.
  2. Air-conditioning machinery including room air-conditioners.
  3. Building contractor's machinery.
  4. Calculating machines.
  5. Electrical machinery - switchgear and instruments, transformers and other stationery plant and wiring and fitting of electric light and fan installations.
  6. Hydraulic works, pipelines and sluices.
  7. Locomotives, rolling stocks, tramways and railways used by concerns, excluding railway concerns.
  8. Mineral oil concerns field operations : i) Prime movers ii) Storage tanks (above ground) iii) Pipelines (above ground) iv) Jetties and dry docks
  9. Mineral oil concerns - field operations (distribution) - kerbside pumps, including underground tanks and fittings.
  10. Mineral oil concerns - refineries: i) Prime movers ii) LPG plant
  11. Mines and quarries : i) Surface and underground machinery (other than electrical machinery and portable underground machinery). ii) Head-gears iii) Rails iv) Shafts and inclines v) Tramways on the surface
  12. Neo-post franking machines
  13. Office machinery
  14. Overhead cables and wires
  15. Railway sidings
  16. Refrigeration plant containers, etc. (other than racks)
  17. Ropeways structures : Trestle and station steel work ii) Driving and tension gearing
  18. Salt works - Reservoirs, condensers, salt pans, delivery channels and piers if constructed masonry, concrete, cement, asphalt or similar materials; barges and floating plant; piers, quays and jetties; and pipelines for conveying brine if constructed of masonry, concrete, cement, asphalt or similar materials.
  19. Surgical instruments
  20. Tramways, electric and tramways run by internal combustion engines - permanent way cars - car trucks, car bodies, electrical equipment and motors; tram cars including engines and gears.
  21. Typewriters
  22. Weighing machines
  23. Wireless apparatus and gear, wireless appliances and accessories.
  24. "Continuous Process Plant" means a plant which is required and designed to operate 24 hours a day.
  25. Notwithstanding anything mentioned in this Schedule, depreciation on assets, whose actual cost does not exceed Rs. 5,000 shall be provided depreciation @ 100%. Where such items constitute more than 10% of total actual cost of plant and machinery, normal Schedule XIV rates will apply.