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44 AE

vishu (accountant) (224 Points)

21 July 2018

A. Y 2018-19 ke liye 44AE m kya limit h. Kya kuch light vehicle ya heavy vehicle ka bhi role h.

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11 Replies

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 21 July 2018

For AY 2019-20, the following provision for the calculation of taxable income under section 44AE shall be applicable.

For light goods vehicle (less than or equal to gross weight of 12MT) – Rs. 7,500/- per vehicle per month (part thereof shall be considered full month).
For heavy goods vehicle (more than gross weight of 12MT) –Rs. 1,000/- per tonne per vehicle per month (part thereof shall be considered full month).

But For AY 2018-19, there is no change.. ..

The net total taxable income for such business shall be calculated at the rate of Rs. 7,500/- per vehicle per month or part thereof during the year in which the vehicle is owned by the assessee.
However, the calculation above shall be irrespective of the fact whether it is a light goods vehicle (less than or equal to 12MT) or a heavy goods vehicle (more than 12MT).

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Ramesh Garg (2 Points)
Replied 17 September 2018

As per My opinion a truck owner cannot earn such money which critaria given by income tax department . If a gross vehicle weight for 17 MT TRUCK ( 10 WHEEL)= 8.5 MT VEHICLE WEIGHT+ GOODS CAPACITY 17 MT THEN TAXABLE INCOME IS 8.5+17= 25.5*1000 = 25500 PER MONTH , THAT IS NOT POSSIBLE , EARLIER THIS FIGURE WAS RS 7500/MONTH.

Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 18 September 2018

Here, the rates are charges over gross vehicle weight or unladen weight only.........

So, in the example.... it will be 8,500/- PM.... for unladen weight of 8.5 MT Truck....

RITESH KUMAR JAIN (CA IN PRACTICE) (118 Points)
Replied 23 March 2019

SIR as per section 44AE -

GROSS VEHICLE WEIGHT OR UNLADEN WEIGHT AS THE CASE MAY BE

As per definition in Motor Vehicle Act - unladen weight applicable for tractor or roller (having only self weight, not of goods) and gross vehicle weight is applicable for other heavy goods vehicle (having weight of goods also)

so i think income will be 25000/- per month

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 23 March 2019

@ Ritesh..

Thanks to point out the mistake...

Actually in above case the truck as specified in the example is just 8.5MT gross weight and hence its not considered heavy vehicle if its gross weight is below 12 MT, and hence only rs. 7,500/- PM will be charged.

Please note the clarification issued under the act as...

Following sub-section (2) shall be substituted for the existing sub-section (2) of section 44AE by the Finance Act, 2018, w.e.f. 1-4-2019 :

(2) For the purposes of sub-section (1), the profits and gains from each goods carriage,—

(i) being a heavy goods vehicle, shall be an amount equal to one thousand rupees per ton of gross vehicle weight or unladen weight, as the case may be, for every month or part of a month during which the heavy goods vehicle is owned by the assessee in the previous year or an amount claimed to have been actually earned from such vehicle, whichever is higher;

(ii) other than heavy goods vehicle, shall be an amount equal to seven thousand five hundred rupees for every month or part of a month during which the goods carriage is owned by the assessee in the previous year or an amount claimed to have been actually earned from such goods carriage, whichever is higher.

Explanation.—For the purposes of this section,—

(a) the expression "goods carriage" shall have the meaning assigned to it in section 2 of the Motor Vehicles Act, 1988 (59 of 1988);

(a) the expressions "goods carriage", "gross vehicle weight" and "unladen weight" shall have the respective meanings assigned to them in section 2 of the Motor Vehicles Act, 1988 (59 of 1988);

(aa) the expression "heavy goods vehicle" means any goods carriage, the gross vehicle weight of which exceeds 12000 kilograms;

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 23 March 2019

Or as specified earlier .... if gross weight is 25.5 MT is taken as heavy goods vehicle..... as per motor vehicle act...

For IT sec. 44AE only unladen weight is taken for taxation, which is just 8.5 MT i.e Rs. 8,500/- PM.

RITESH KUMAR JAIN (CA IN PRACTICE) (118 Points)
Replied 23 March 2019

but 44 ae says

one thousand rupees per ton of gross vehicle weight or unladen weight, as the case may be

Read more at: https://www.caclubindia.com/forum/44-ae-474058.asp

Gross vehicle weight or unladen weight as the case may be

just clarify in which case gross vehicle weight and in which case unladen weight will be applicable

RITESH KUMAR JAIN (CA IN PRACTICE) (118 Points)
Replied 23 March 2019

If we see on it dept website tax tools and fill income u/s 44 AE only gross vehicle weight is asked, there is no place for unladen weight

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 23 March 2019

Yes Dear,

You are right. Departmental tools are calculating it based on Gross weight. As such the unladen weight is just for tractors or other vehicles as per Motor act. It also gives impression that for heavy goods vehicles sec. 44AE is no more lucrative, only small vehicles owners may adopt it. Thanks again for the enlightenment.

Rohit JIndal (Partner @ C R Jindal & Associates) (33 Points)
Replied 26 March 2019

But sir As per Motor Vehicle Act
“gross vehicle weight” means in respect of any vehicle the total weight of the vehicle and load certified and registered by the registering authority as permissible for that vehicle;

which include the wait of the vehicle and goods both

so in the above example the gross vehicle weight = 8.5 + 17 = 25.5

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Dhirajlal Rambhia (SEO Sai Gr. Hosp.) (177741 Points)
Replied 26 March 2019

Yes, agreed. I retify to the interpretation.