Source: http://icaigzb.org/utilities.php?id=10
Timestamp: 2019-04-21 14:24:53+00:00

Document:
1.	"Buildings" include roads, bridges, culverts, wells and tubewells.
2.	A building shall be deemed to be a building used mainly for residential purposes, if the built-up floor area thereof used for residential purposes is not less than sixty-six and two-third per cent of its total built-up floor area and shall include any such building in the factory premises.
3.	In respect of any structure or work by way of renovation or improvement in or in relation to a building referred to in Explanation 1 of clause (ii) of sub-section (1) of section 32, the percentage to be applied will be the percentage specified against sub-item (1) or (2) of item I as may be appropriate to the class of building in or in relation to which the renovation or improvement is effected. Where the structure is constructed or the work is done by way of extension of any such building, the percentage to be applied would be such percentage as would be appropriate, as if the structure or work constituted a separate building.
4.	Water treatment system includes system for desalination, demineralisation and purification of water.
5.	"Electrical fittings" include electrical wiring, switches, sockets, other fittings and fans, etc.
6.	"Commercial vehicle" means "heavy goods vehicle", "heavy passenger motor vehicle", "light motor vehicle", "medium goods vehicle" and "medium passenger motor vehicle" but does not include "maxi-cab", "motor-cab", "tractor" and "road-roller". The expressions "heavy goods vehicle", "heavy passenger motor vehicle", "light motor vehicle", "medium goods vehicle", "medium passenger motor vehicle", "maxi-cab", "motor-cab", "tractor" and "road-roller" shall have the meanings respectively as assigned to them in section 2 of the Motor Vehicles Act, 1988 (59 of 1988).
7.	"Computer software" means any computer programme recorded on any disc, tape, perforated media or other information storage device.
8.	"TUFS" means Technology Upgradation Fund Scheme announced by the Government of India in the form of a Resolution of the Ministry of Textiles vide No. 28/1/99-CTI of 31-3-1999.
9.	Machinery and plant includes pipes needed for delivery from the source of supply of raw water to the plant and from the plant to the storage facility.
10.	"Speed boat" means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometers 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.
1. Depreciation is the systematic allocation of the depreciable amount of an asset over its useful life. The depreciable amount of an asset is the cost of an asset or other amount substituted for cost, less its residual value. The useful life of an asset is the period over which an asset is expected to be available for use by an entity, or the number of production or similar units expected to be obtained from the asset by the entity.
Provided that where a company uses a useful life or residual value of the asset which is different from the above limits, justification for the difference shall be disclosed in its financial statement.
Cost incurred by the company in accordance with the accounting standards.
Actual revenue (Toll Charges) received during the accounting year.
Total projected revenue from the Intangible Assets as provided to the project lender at the time of financial closure/agreement.
Based on this the charge for first year would be Rs. 4.16 Crore (approximately) (i.e. Rs. 5/Rs. 600 × Rs. 500 Crores) which would be charged to profit and loss and 0.83% (i.e. Rs. 4.16 Crore/Rs. 500 Crore × 100) is the amortisation rate for the first year.
7. Field operations (above ground) Portable boilers, drilling tools, well-head tanks, etc.
1. Electrical Machinery, X-ray and electrotherapeutic apparatus and accessories thereto, medical, diagnostic equipments, namely, Cat- Scan, Ultrasound Machines, ECG Monitors, etc.
(ii) 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 circuses; and furniture and fittings let out on hire for use on the occasion of marriages and similar functions.
(ii) End user devices, such as, desktops, laptops, etc.
2. 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 apro 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.
4. Useful life specified in Part C of the Schedule is for whole of the asset. Where cost of a part of the asset is significant to total cost of the asset and useful life of that part is different from the useful life of the remaining asset, useful life of that significant part shall be determined separately.
(b) after retaining the residual value, shall be recognised in the opening balance of retained earnings where the remaining useful life of an asset is nil.
8. "Continuous process plant" means a plant which is required and designed to operate for twenty-four hours a day.
a. Jeeps are classifiable as motor cars — Crompton Engg. Co. (Madras) Ltd. v. CIT  193 ITR 483 (Mad.)/CAIT v. Good Hope Enterprises  197 ITR 236 (Ker.).
b. Trucks primarily used for assessee's own business and occasionally let out on hire will not fall under this entry unless assessee carries on a business of running them on hire—CIT v. Manjeet Stone Co. 190 ITR 183 (Raj.); Vehicles plying between fixed points for carriage of passengers fall under this entry—ITO v. Sarojini Transports (P.) Ltd.  17 ITD 1014 (Mad.); Mobile crane mounted on a lorry falls under this entry—Gujco Carriers v. CIT  122 Taxman 206 (Guj.); Rigs and Compressors mounted on a lorry do not fall under this item—CIT v. Popular Borewell Service  194 ITR 12 (Mad.); Motor vans are akin to motor lorries or motor buses—Circular No. 609, dated 29-7-1991/CIT v. Kodak Ltd.  181 ITR 275 (Bom.); Ambulance van falls under this entry—CIT v. Dr. K.R. Jayachandran  212 ITR 637 (Ker.); Air-conditioned vehicles fall under this entry—CIT v. Urmila Goel  52 CTR (Delhi) 276.
c. 40 per cent if conditions of rule 5(2) are satisfied.
d. Company manufacturing insulated wires and cables is not covered under this entry—CIT v. Falcon Wires (P.) Ltd.  123 ITR 427 (Mad.).
e. Machinery used for dyeing, bleaching and printing of cloth manufactured by some other person will not fall under this item—CIT v. Jaypee Dyeing House  239 ITR 418 (Bom.).
† Applicable from the assessment year 2004-05.
f. Mere fact that assessee sold some cylinders during the previous year will not convert the cylinders into stock-in-trade. The cylinders must be capable of containing gas, and there is no requirement that the cylinders must be filled with gas—Chawla Architects & Consultants (P.) Ltd. v. Asstt. CIT  54 ITD 330 (Bom.).
g. Petroleum company distributing gas for cooking purpose is a 'mineral oil concern'—CIT v. Burmah Shell Oil Storage & Distribution Co. of India Ltd.  115 ITR 891 (Cal.); Vegetable oil is not a 'mineral oil'—CIT v. Distillers Trading Corporation Ltd.  137 ITR 894 (Delhi).
1. Corresponds to Schedule XIV of the 1956 Act.
2. Enforced with effect from 1-4-2014.
"(i) In case of such class of companies, as may be prescribed and whose financial statements comply with the accounting standards prescribed for such class of companies under section 133 the useful life of an asset shall not normally be different from the useful life and the residual value shall not be different from that as indicated in Part C, provided that if such a company uses a useful life or residual value which is different from the useful life or residual value indicated therein, it shall disclose the justification for the same.
(ii) In respect of other companies the useful life of an asset shall not be longer than the useful life and the residual value shall not be higher than that prescribed in Part C.
(iii) For intangible assets, the provisions of the Accounting Standards mentioned under sub-para (i) or (ii), as applicable, shall apply."
"(b) Continuous process plant for which no special rate has been prescribed under (ii) below [NESD] 8 Years"
"5. Depreciable amount is the cost of an asset, or other amount substituted for cost, less its residual value. Ordinarily, the residual value of an asset is often insignificant but it should generally be not more than 5% of the original cost of the asset."

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