Sapna Tours, Travels and Lease vs Commissioner of Income Tax

Essentially, on the question of fact, the Tribunal has decided the appeal and has confirmed the order made by the assessing authority which was confirmed by the CIT(A). The Tribunal after examining the agreements and other material which was placed on record, arrived at a conclusion that the vehicles were given to the companies and also arrived at the conclusion that the assessed failed to prove the fact that the cars were used by the Indian companies for the foreign tourists at that time during the period of agreement. The Tribunal examined some certificates to indicate the use of vehicles for foreign tourists. However, it is required to be noted that it is the assessed who has to give his vehicle to the tourists on hire basis so as to earn the benefits u/s 32 of the IT Act. To promote the tourism, the scheme was incorporated at the relevant time strictly confining benefits of depreciation on imported vehicles used for tourists. If the vehicle is used on hire for tourists, only then a person would be entitled to get the benefit.

On appreciation of facts, the Tribunal has held that the vehicles were not used for the purpose for which benefit was claimed. Under the circumstances, we find no reason to admit the appeal.