ACIT, New Delhi V. M/s Renaissance Asset Management Co. Pvt. Ltd., New Delhi

ITA 1734/DEL/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3754 (ITAT-DELHI)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-06-2011
• Appeal Filed By: Department
• Bench Allotted: F
• Next Hearing Date: 08-06-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 08-04-2011
• Court: TRIBUNAL
• Department Lawyers: B KISHORE
• Assessee Lawyers: RAVINDER PAL SINGH
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI K.D. RANJAN, ACCOUNTANT MEMBER I.T.A NO. 1734/DEL/11 ASSTT. YEAR 2007-08 ACIT, CIRCLE-15(1), C.R. BUILDING, I.P. ESTATE, NEW DELHI. VS. M/S. RENAISSANCE ASSET MANAGEMENT CO. PVT. LTD., B- 47, 2 ND FLOOR, SHIV MAHAL, CONNAUGHT PLACE, NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI B.KISHORE, SR. DR. RESPONDENT BY: SHRI RAVINDER PAL SINGH, CA ORDER PER RAJPAL YADAV, JM: THE REVENUE IS IN APPEAL BEFORE US AGAINST THE ORD ER OF LD. CIT(A) DATED 22.12.2010 PASSED FOR ASSTT. YEAR 2007-08. T HE GRIEVANCE OF THE REVENUE IS THAT LD. CIT(A) HAS ERRED IN DELETING TH E ADDITION OF ` 10,75,575/-. THIS ADDITION WAS MADE BY THE AO BY MA KING DISALLOWANCE OUT OF CLAIM FOR DEPRECIATION. 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE HA S FILED ITS RETURN OF INCOME ON 30 TH OCTOBER, 2007 DECLARING A TOTAL LOSS OF ` 4,12,13,041/-. THE ASSESSEE HAS CLAIMED DEPRECIATION @ 80% ON WIND TURBINE. THE ITA NO. 1670/DEL/11 ASSTT. YEAR 2006-07 2 AO WAS OF THE VIEW THAT SUM OF ` 11,34,000/-WAS INCURRED FOR FOUNDATION AND ` 4,33,500/- WAS INCURRED TOWARDS ELECTRICAL FITTING S. THE DEPRECIATION ON THESE ITEMS IS ADMISSIBLE AT 10% A ND 15% RESPECTIVELY. HE REDUCED THE DEPRECIATION CLAIMED ON THESE TWO I TEMS AND MADE AN ADDITION OF ` 10,75,575/-. LD. CIT(A) HAS DELETED THE DISALLOWANC E ON THE GROUND THAT SIMILAR DISALLOWANCE WAS MADE IN ASSTT. YEAR 2005-06 WHICH WAS DELETED BY THE LD. CIT(A) AND TRIBUNAL HAS UPHE LD THE ORDER OF LD. CIT(A). 3. LD. COUNSEL FOR THE ASSESSEE PLACED ON RECORD CO PY OF THE TRIBUNALS ORDER. LD. DR WAS UNABLE TO CONTROVERT T HE CONTENTION OF LD. COUNSEL FOR THE ASSESSEE. WE FIND THAT AN IDENTICAL ISSUE WAS EXAMINED BY THE TRIBUNAL IN 2005-06 AND THE TRIBUNAL HAS MAD E FOLLOWING OBSERVATION :- 3. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND FO UND FROM THE RECORD THAT TOTAL COST OF WINDMILLS INSTALLED BY THE ASSES SEE WORKS OUT TO RS. 5,94,60,000/- OUT OF WHICH A BIFURCATION HAS BEEN G IVEN AND RS. 7 LAKHS WAS PAID FOR FOUNDATION OF TURBINE AND RS. 6 LAKHS ON E LECTRIC FITTINGS, BOTH ARE PART AND PARCEL OF TOTAL COST OF WINDMILLS BECAUSE WITHO UT INSTALLATION, WINDMILLS CANNOT WORK. SIMILARLY, ELECTRIC FITTINGS IS ALSO P ART AND PARCEL OF THE WINDMILLS ITSELF WITHOUT WHICH WINDMILLS CANNOT BE OPERATED. WHEN THE AO HAS ALLOWED DEPRECIATION IN RESPECT OF WINDMILLS AS A WHOLE ,TH ERE IS NO REASON TO SEPARATE THE COST INCURRED ON FOUNDATION OF TURBINE AND ELECTRIC FITTINGS, WHILE ALLOWING CLAIM OF DEPRECIATION OF ENTIRE WINDMILLS. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING D ISALLOWANCE OF DEPRECIATION ON THESE PARTS OF WINDMILLS. ITA NO. 1670/DEL/11 ASSTT. YEAR 2006-07 3 4. THERE IS NO DISPARITY ON FACTS. THE LD. CIT(A) HAS DELETED THE DISALLOWANCE ON THE SAME LINE. THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT(A). ORDER PRONOUNCED IN THE OPEN COURT ON 8.6.2011 SD/- SD/- [K.D. RANJAN] [RAJPAL YADAV] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 8.6.2011 VEENA COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, DEPUTY REGISTRAR, ITAT