RATES OF DEPRECIATION
(FOR INCOME TAX)
AS APPLICABLE FORM THE ASSESSMENT YEAR 1988-89 ONWARDS

 

Block of Assets

Dep. Allowance
as Percentage of
Written Down Value

1

2

I. Buildings (see notes 1 to 3)

1

Buildings other than those covered by sub-item (3) below which are used mainly for residential purposes 

5

2

Building which are not used mainly for residential purposes and which are covered by sub-item (3) below 

10 

3

i) Buildings used as hotels
ii) Buildings with dwelling units each with plinth area not exceeding square metres 

20
20

4

Purely temporary erections such as wooden structures 

100

II Furniture and fittings

1

Rate applicable to furniture and fittings not covered by sub-item (2) below

10 

2

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

15

III Machinery and Plant

1

Machinery and plant other than those covered by sub items (1A),(2) and (3) below

25 

1A

Motor cars, other than those used in a business of running them on hire, acquired or put to use on or after 1st day of April, 1990 

20

2

(I)   Aeroplanes - Aeroengines 
(ii)   Motor buses, motor lorries and motor taxis used in a business of running them on hire

(iia) Commercial vehicle which is acquired by the assessee on or after the 1st day of April 1998 but before the 1st day of April, 1999 for the purposes of business or profession in accordance with the third proviso to clause (ii) of subsection (1) of section 32 [See Note 3A below the Table]

(iib) New Commercial Vehicles which is acquired on or after the 1st day of October, 1998 in replacement of condemned vehicles of over 15 years of age and is put to use for any period before the 1st day of April, 1999 for the purpose of business or profession in accordance with the third proviso to clause (ii) of subsection (1) of section 32 [See Note 3A below the Table]

(iic) New Commercial Vehicles which is acquired on or after the 1st day of April, 1999, in replacement of condemned vehicles of over 15 years of age and is put to use for any period before the 1st day of April, 2000 for the purpose of business or profession in accordance with the second proviso to clause (ii) of subsection (1) of section 32 [See Note 3A below the Table]

40*
40*

 

40%

 

 

 

60%

 

 

 

60%

Higher depreciation will be admissible on motor lorries used in the assessee's business of transportation of goods on hire. The higher rate of depreciation, however, will not apply if the motor buses, motor lorries, etc., are used in some other non-hiring business of the assessee-circular No. 652, dated June 14, 1993. 

*50 per cent for the assessment years 1988-89 to 1991-92. 

1

"Buildings" include roads, bridges, culverts, wells and tubewells. 

2

A building shall be deemed to be building used mainly for residential purposes if the built-up floor area thereof used for residential purposes is not less than 66 2/3 percent of its total built up floor area.

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 section 32(1), the percentage to be applied will be the percentage specified against sub-item (1),(2) or (3) 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, however, 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 

3A

 "Commercial vehicle" means "heavy goods vehicle", "heavy passenger motor vehicle", "light motor vehicle", "medium goods vehicle" and "medium passenger 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 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).

4

Extra-shift allowance is not available from the assessment year 1988-89 onwards.

5

For the assessment years 1988-89 to 1991-92,33.33 per cent. Moreover, if the following conditions are satisfied, then plans and machinery shall be treated as a part of block of assets qualifying for depreciation at the rate of 40 percent (50 [percent for the assessment years 1988-89 to 1991-92) [by virtue of rule 5(2)]:

iii

Moulds used in rubber and plastic goods factories 

40*

iv

Air pollution control equipments, being- 

  • Electrostatic precipitation systems, 
  • Felt-filter systems, 
  • Dust collector systems, 
  • Scrubber-counter current/venturi/packed-bed/cyclonic scrubbers,* 
  • Ash handling system and evacuation system (from the assessment year 1994-95)

100**

v

Water pollution control equipments, being- 

  • Mechanical screen systems, 
  • Aerated detritus chambers (including air compressor), 
  • Mechanically skimmed oil and grease removal systems 
  • Chemical feed systems and flash mixing equipment 
  • Mechanical flocculators and mechanical reactors, 
  • Diffused air/mechanically aerated activated sludge systems, 
  • Aerated lagoon systems, 
  • Biofilters, 
  • Methane-recovery anaerobic digester systems, 
  • Air floatation systems, 
  • Air/steam stripping systems, 
  • Urea Hydrolysis systems, 
  • Marine out fall systems, 
  • Centrifuge for de-watering sludge, 
  • Rotating biological contractor or bio disc, 
  • Ion exchange resin column, 
  • Activated Carbon Column, 

100**

vi

(a). Solid waste control equipment , being-caustic/lime/chrome/mineral/Cryolite recovery system. 

(b).Solid waste recycling and resource recovery system. (Applicable for the A.Y 94-95).

100**
 

100**

vii

Machinery and plant, used in semi-conductor industry covering all integrated circuits (Ics) (Excluding hybrid integrated circuits) ranging from small scale integration(SSI) to large scale integration/very large scale integration ( LSI/VLSI) as also discrete semiconductor devices such as diodes transistors thyristors, triacs , etc other than those covered by entries (iv), (v) and (vi) of this sub-item and sub\item (3) below[Applicable from December 22'1993]. 

40

2A

Containers made of glass or plastic used as refills (Applicable from the A.Y.97-98).

50

New machinery or plant is installed during the previous year relevant to the A.Y.1988-89 ( or any subsequent year) , for the purposes of business of manufacture or production of any article or thing (not being any article or thing specified in the eleventh schedule). 

Such article or thing is manufactured is or produced by using any technology (including any process) or know how developed in (or is an article or thing invented in) a laboratory owned of financed by the government or a laboratory owned by a public sector company or a university or an institution recognized in this behalf by the secretary, Department of Scientific & Industrial research, Government Of India. 

The right to use such technology (including any process) or other know how or to manufacture or produce such article or thing has been acquired from the owner of such laboratory or any person deriving title from such owner . 

The return furnishes by the assessee for any previous Year In which the said machinery or plant is acquired, shall be accompanied by certificate from the secretary , Department of Scientific & Industrial Research Government Of India , to the effect that such article or thing is manufactured or produced by using such technology(Including Any Process).or other Know how developed in such laboratory or is an article or thing invented in such laboratory. 

*50 percent for the assessment years 1988-89 to 1991-92.
**50 percent for the assessment years 1988-89 to 1991-92 and 40 percent for the assessment years 1992-93 and 1993-94.

3

(I) Wooden parts used in artificial skill manufacturing machinery 
(ii) Cinematography films- bulbs of studio lights. 
(iii) Energy saving devices being - 

100
100

A) Specified biolers and furnaces : 

  • Ignifluid/fluidized bed boilers 
  • Flameless furnaces and continuous pusher type furnaces 
  • Fluidezed bed type heat treatment furnaces 
  • High efficiency boilers (thermal efficiency higher than 75 percent in case of coal fired and 80 percent in case of oil/gas fired boilers) 

100

B) Instrumentation and monitoring system for monitoring energy flows 

  • Automatic electrical load monitoring systems 
  • Digital heat loss meters 
  • Micro-processor-based control systems 
  • Infrared thermography 
  • Meters for measuring heat losses, furnace oil flow, steam flow, Electric energy and power factor meters 
  • Maximum demand indicator and clamp on power meters 
  • Exhaust gases analyser 
  • Fuel oil Pump test bench 

100

C) Waste heat recovery equipment : 

  • Economisers and feed water heaters 
  • Recuperators and air pre-heaters 
  • Heat Pumps 
  • Thermal energy wheel for high and low temperature waste heat recovery. 

100

D) Co-generation systems : 

  • Back pressure pass out, controlled extraction, extraction-cum-condensing turbines for cogeneration along with pressure boilers 
  • Vapour absorption refrigeration systems 
  • Organic ranking cycle power systems 
  • Low inlet pressure small steam turbines 

100

E) Electrical equipment 

  • Shunt capacitors and synchronous condenser systems 
  • Automatic power cut off devices(relays )mounted on individual motors 
  • Automatic voltage controller. 
  • Power factor controller for A.C. motors. 
  • Solid state devices for controlling motor speeds 
  • Thermally energy efficient stenters (which require 800 or less kilo calories of heat to evaporate one kilogram of water) 

100

F) Burners : 

  • 0 to 10 % excess air burners 
  • Emulsion burners 
  • Burners using air with high preheat temperature (above 300 degree Celsius) 

100

G) Other equipment : 

  • Wet air oxidation equipment for recovery of chemicals and heat. 
  • Mechanical vapour recompressors 
  • Thin film evaporators 
  • Automatic micro-processor based load demand controllers 
  • Coal based producer gas plants 
  • Fluid derives and fluid couplings 
  • Turbo charges/Super charges 

100

iv

Flour mills - Rollers 

100

v

Gas cylinders including valves and regulators 

100

vi

Glass manufacturing concerns - Direct fire glass melting furnaces

100

vii

Iron and steel industry - Rolling mill rolls

100

viii

Match factories - Wooden match frames

100

ix

Mineral oil concerns - 

  • Plant used in field operations (above ground) Distribution Returnable packages 
  • Plant used in field operations (below ground) but not including kerbside pumps including underground tanks and fittings used in field operations(distribution) by mineral oil concerns 

100

x

Mines and quarries : 

  • Tubs, winding ropes, haulage ropes and sand stowing pipes 
  • Safety lamps 

100
100

xi

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

100

xii

Sugar works - Rollers 

100

xiii

Renewal energy devices being : 

  • Flat plate solar collectors 
  • Concentrating and pipe type solar collectors 
  • Solar cookers 
  • Solar water heaters and systems 
  • Air/gas/fluid heating systems 
  • Solar crop driers and systems 
  • Solar refrigerator, cold storages & air-conditioning Systems. 
  • Solar steels & desalination systems. 
  • Solar power generating systems. 
  • Solar pumps based on solar thermal and solar photovoltaic conversion 
  • Solar photovoltaic nodules and panels for water pumping and other applications. 
  • Wind mills and any specially designed devices which run on wind mills. 
  • Any special devices including electric generators and pumps running on wind energy. 
  • Biogas plant and biogas engines. 
  • Electrically operated vehicles including battery powered or fuel-cell powered vehicles. 
  • Agricultural and municipal waste conversion devices producing energy. 
  • Equipment for utilising ocean waste and thermal energy. 
  • Machinery and plant used in the manufacture of any of 100 the above sub-items.

100

4

Books owned by an assessee carrying on a profession or books owned by assessee carrying on business in running lending libraries (with effect from the assessment year 1996-97) 

100

IV

Ships 

1

Ocean-going ships including dredgers, tugs, barges, survey launches and other similar ships used mainly for dredging purposes and fishing vessels with wooden hull

20

2

Vessels ordinarily operating on inland waters, not covered by sub- item 3 below 

10

3

Vessels ordinarily operating on inland waters being speed boats. 

20

DEPRECIATION RATES FOR POWER GENERATING UNITS 
(APPLICABLE FROM THE ASSESSMENT YEAR 1998-99)

Class of Assets

Depre. Allowances as Percentage of Actual Class. 

a)

Plant & machinery in generating stations including plant foundations:- 

  • Hydro-electric 
  • Steam electric NHRS & waste heat recovery Boilers /plants. 
  • Diesel electric and Gas plant.

3.4
7.84
8.24

b)

Cooling towers and circulating water systems 

7.84

c)

Hydraulic works forming part of Hydro-electric system including :- 

  • Dams, spillways weirs, canals, reinforced concrete Flumes and syphons 
  • Reinforced concrete pipelines and surge tanks steel pipelines, sluice gates, steel surge (tanks) Hydraulic control valves and other hydraulic works. 

1.95

3.4

d)

Building and civil engineering works of permanent character, not mentioned above 

  • Office & showrooms 
  • Containing Thermo-electric generating plant. 
  • Containing Hydro Electric generating plant. 
  • Temporary erection such as wooden structures. 
  • Roads and other than Kutcha roads. 
  • Others 

3.02
7.84
3.4 
33.4
3.02
3.02

e)

Transformers, transformer (kiosk) sub-station equipment & other fixed apparatus (including plant foundations) 

  • Transformers (including foundations) having rating of 100 kilo volt amperes and over 
  • Others. 

7.81
7.84

f)

Switchgear including cable connections 

7.84

g)

Lightning arrestor : 

  • Station type 
  • Pole type. 
  • Synchronous condenser

7.84
7.84
5.27

h)

Batteries 

  • Underground cable including joint boxes and disconnection boxes 
  • Cable duct system

33.4

5.27
3.02

i)

Overhead lines including supports : 

  • Lines on fabricated steel operating at nominal voltages higher than 66 kilo volts. 
  • Lines on steel supports operating at nominal voltages higher than 13.2 kilo volts but not exceeding 66 kilo volts 
  • Lines on steel or reinforced concrete supports 
  • Lines on treated wood supports 

5.27.

7.84

7.84
7.84

j)

Meters 

12.77

k)

Self-propelled vehicles 

33.40

l)

Air - conditioning plants : 

  • Static 
  • Portable

12.77
33.40

m)
  • Office furniture & fittings 
  • Office equipment 
  • Internal wiring including fittings & apparatus. 
  • Street light fittings 

12.77
12.77
12.77
12.77

n)

Apparatus let on hire ; 

  • Other than motors 
  • Motors 

33.4
12.77

o)

Communication equipment 

  • Radio and high frequency carrier system 
  • Telephone lines and telephones 

12.77
12.77

p)

Any other assets not covered above 

7.69