The ACIT, Circle-6, Ahmedabad V. M/s. Maharshi Udhyog, Ahmedabad

ITA 1358/AHD/2012

• Counselvise Citation: 135820514 RSA 2012
• Duration Of Justice: 3 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 11-08-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 22-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIVA SEWAKSR
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

I.T.A. NO.: 1358/AHD/2012 ASSESSMENT YEAR: 2009-10 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH-B, AHMEDABAD. [CORAM: PRAMOD KUMAR AM AND KUL BHARAT_JM] I.T.A. NO.: 1358/AHD/2012 ALONG WITH C.O NO.120/AHD/2012 ASSESSMENT YEAR: 2009-10 ASSTT. CIT, CIRCLE-6, AHMEDABAD. ................ ....APPELLANT VS. M/S MAHARSHI UDYOG, PLOT NO.2904, PHAZE-IV, GIDC ESTATE, VATVA, AHMEDABAD. . .RESPONDENT PAN AADFM 1075E APPEARANCES BY: SHIVA SEWAK,SR.DR........FOR THE APPELLANT P. M. MEHTA, WITH G. M. THAKORE, ARS...... F OR THE RESPONDENT DATE OF CONCLUDING THE HEARING: 11.8.2015 DATE OF PRONOUNCING THE ORDER: 6 TH NOVEMBER, 2015 O R D E R PER PRAMOD KUMAR, AM: THIS APPEAL, AS ALSO THE RELATED CROSS OBJECTION WH ICH IS TAKEN UP FOR HEARING ALONG WITH THIS APPEAL, IS DIRECTED AGAINST THE ORDER DATED 30 TH APRIL, 2012 PASSED BY THE LD. CIT(A) IN THE MATTER OF ASSE SSMENT UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSME NT YEAR 2009-10. 2. GRIEVANCE RAISED BY THE ASSESSING OFFICER, IN TH IS APPEAL IS AS FOLLOWS: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF ASSESSEES CLAIM OF DEPRECIATION @ 80% ON THE CIVIL WORK, LABOUR CHARGES, PROCESSING & APPLICATION FEES PAID TO MEDIA AND DEVELOPMENT CHARGES PERTAINING TO THE INSTALLATION OF WINDMILLS. I.T.A. NO.: 1358/AHD/2012 ASSESSMENT YEAR: 2009-10 PAGE 2 OF 3 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE AO. 3. IT IS THEREFORE, PRAYED THAT THE ORDER OF THE LD . CIT(A) MAY BE SET ASIDE AND THAT OF THE AO BE RESTORED. 3. LD. REPRESENTATIVES FAIRLY AGREE THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE, BY A DECISION OF THE CO-ORDINATE BENC H IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2008-09, WHILE SO UPHOLDING THE RELIEF GIVEN BY THE CIT(A), ON THE SAME ISSUE IN THE ASSESSMENT YEAR 20 08-09, CO-ORDINATE BENCH HAS RELIED UPON HONBLE GUJARAT HIGH COURTS JUDGMENT DATED 29 TH JANUARY, 2013 IN THE CASE OF CIT VS. PARRY ENGINEER ING & ELECTRONICS P. LTD. (TA NO. 604 OF 2012) WHEREIN THEIR LORDSHIPS HAVE, INTER ALIA, OBSERVED AS FOLLOWS:- 5. WE ARE OF THE OPINION THAT THE APPROACH OF BOTH THE AUTHORITIES IS PERFECTLY JUSTIFIED. WINDMILL WOULD REQUIRE A SCIEN TIFICALLY DESIGNED MACHINERY IN ORDER TO HARNESS THE WIND ENERGY TO THE MAXIMUM POTENTIAL. SUCH DEVICE HAS TO BE FITTED AND MOUNTED ON A CIVIL CONSTRUCTIO N, EQUIPPED WITH ELECTRIC FITTINGS IN ORDER TO TRANSMIT THE ELECTRICITY SO GE NERATED. SUCH CIVIL STRUCTURE AND ELECTRIC FITTINGS, THEREFORE, IT CAN BE WELL IM AGINED, WOULD BE HIGHLY SPECIALIZED. THUS SUCH CIVIL CONSTRUCTION AND ELECT RIC FITTING WOULD HAVE NO USE OTHER THAN FOR THE PURPOSE OF FUNCTIONING OF TH E WINDMILL. ON THE OTHER HAND IT CAN BE EASILY IMAGINED THAT WINDMILL CANNOT FUNCTION WITHOUT APPROPRIATE INSTALLATION AND ELECTRIFICATION. IN OT HER WORDS, THE INSTALLATION OF WINDMILL AND THE CIVIL STRUCTURE AND THE ELECTRIC F ITTINGS ARE SO CLOSELY INTERCONNECTED AND LINKED AS TO FORM THE COMMON PLA NT. AS ALREADY NOTED, THE LEGISLATURE HAS PROVIDED FOR HIGHER RATE OF DEPRECI ATION OF 80 PER CENT ON RENEWABLE ENERGY DEVISES INCLUDING WINDMILL AND ANY SPECIALLY DESIGNED DEVISE, WHICH RUNS ON WINDMILL. THE CIVIL STRUCTURE AND THE ELECTRIC FITTING, EQUIPMENTS ARE PART AND PARCEL OF THE WINDMILL AND CANNOT BE SEPARATED FROM THE SAME. THE ASSESSEES CLAIM FOR HIGHER DEPRECIAT ION ON SUCH INVESTMENT WAS THEREFORE, RIGHTLY ALLOWED. 4. IN VIEW OF THE ABOVE, AND RESPECTFULLY FOLLOWING THE ESTEEMED VIEWS OF THEIR LORDSHIPS WE CONFIRM THE ORDER OF THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. 5. IN THE RESULT, THE APPEAL IS DISMISSED. I.T.A. NO.: 1358/AHD/2012 ASSESSMENT YEAR: 2009-10 PAGE 3 OF 3 6. AS FOR THE CROSS OBJECTION, THE ONLY GRIEVANCE P RESSED BEFORE US IS AS FOLLOWS :- 2. IN LAW AND IN THE FACTS AND CIRCUMSTANCES OF THE RESPONDENTS CASE, THE LEARNED CIT(A) HAS GROSSLY ERRED IN DISMISSING GROU ND NO.3 SEEKING DEDUCTION FOR DEPRECIATION IN RESPECT OF EXPENDITUR E PERTAINING TO PURCHASE OF WINDMILL DISALLOWED IN THE APPELLANTS ASSESSMENT FOR A.Y. 2007-08 ON THE GROUND THAT IT WAS CAPITAL IN NATURE . HE OUGHT TO HAVE APPRECIATED INTER ALIA, THAT SIMILAR CLAIM OF THE A PPELLANT FOR THE IMMEDIATELY PRECEDING AY 2008-09 HAD BEEN ALLOWED BY THE LD. CIT(A) AND THE SAME DESERVED TO BE ALLOWED THIS YEAR AS WE LL (ALBEIT, ON WDV). 7. LD. REPRESENTATIVES FAIRLY AGREE THAT THIS ISSUE IS NOW COVERED IN FAVOUR OF ASSESSEE BY TRIBUNALS DECISION IN ASSESS EES OWN CASE FOR THE ASSESSMENT YEAR 2007-08. IN THIS VIEW OF THE MATTER , WE UPHOLD THE GRIEVANCE OF THE ASSESSEE AND DIRECT THE ASSESSING OFFICER TO GRANT THE RESULTANT RELIEF. 8. IN THE RESULT, THE CROSS OBJECTION IS ALLOWED IN THE TERMS INDICATED ABOVE. 9. TO SUM UP, WHILE APPEAL OF THE ASSESSING OFFICER IS DISMISSED, THE CROSS OBJECTION OF THE ASSESSEE IS ALLOWED IN THE T ERMS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 6 TH DAY OF NOVEMBER, 2015 SD/- SD/- KUL BHARAT PRA MOD KUMAR (JUDICIAL MEMBER) (AC COUNTANT MEMBER) AHMEDABAD, THE 6 TH DAY OF NOVEMBER, 2015 COPIES TO: (1) THE APPELLANT (2) THE RESPON DENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH AHMEDABAD