ACIT, UDAIPUR V. M/s. Nahar Colour & Coating Ltd., UDAIPUR

ITA 288/JODH/2014

• Counselvise Citation: 28823314 RSA 2014
• Duration Of Justice: 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 05-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation; Unabsorbed depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA , JUDICIAL MEMBER AND SHRI N.K.SAINI, ACCOUNTANT MEMBER ITA NO. 288 / JU/ 20 1 4 ASSESSMENT YEAR: 20 10 - 11 THE A.C.I.T V S. M/S NAHAR COLOUR & COATING LTD CIRCLE - 2 G - 1, 90 - 93, UDYOG VIHAR, UDAIPUR SUKHER, UDAIPUR PAN NO. AAACN 6942 K (APPELLANT) (RESPONDENT) A SSESSEE B Y : NONE DEPARTMENT B Y : SHRI N.A. JOSHI , DR DATE OF H EARI NG : 0 5 . 0 8 .201 4 DATE OF PRONOUNCEMENT : 12 . 0 8 . 201 4 ORDER PER HARI OM MARATHA , J .M. TH IS APPEAL BY THE REVENUE IS DIRECTED A GAINST THE ORDER OF THE CIT (A) , UDAIPUR DATED 17 . 0 2 .20 1 1 PERTAINING TO A.Y 20 10 - 11 . 2 2. WE HAVE HEARD THE SUBMISSIONS OF THE LD. D.R AND HAVE CAREFULLY PERUSED THE RELEVANT MATERIAL ON RECORD AS NOBODY CAME TO REPRESENT THE RESPONDENTS CASE AND ALSO NO APPLICATION FOR ADJOURNMENT WAS RECEIVED. IT WAS ALSO NOTICED THAT BOTH THE ISSUES INVOLVED IN THIS APPEAL STAND COVERED I N FAVOUR OF THE ASSESSEE BY THE ORDER OF THE TRIBUNAL RENDERED IN THIS VERY ASSESSEES CASE. HENCE, WE HAVE PROCEEDED EX PARTE QUA THE ASSESSEE. 3. FIRST GROUND PERTAINS TO CLAIM OF DEDUCTION U/S 80IA OF THE INCOME - TAX ACT, 1961 ['THE ACT' FOR SHORT] AMOUN TING TO RS. 52,86,966/. 3.1 FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE - COMPANY IS ENGAGED IN THE MANUFACTURING OF GLAZE FRIT MAINLY USED FOR CERAMIC TILE MANUFACTURING UNITS. IT IS ALSO ENGAGED IN GENERATION OF WIND - POWER - ENERGY. THE ASSESSEE - COMPA NY FILED ITS RETURN OF INCOME FOR ASSESSMENT YEAR 2010 - 11 ON 29.9.2010, DISCLOSING TOTAL INCOME OF RS. 1,63,40,530/ - . THE ASSESSEE HAS CLAIM ED DEDUCTION U/S 80IA OF THE INCOME - TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT', FOR SHORT] IN RESPECT OF WI NDMILL INSTALLED THROUGH SUZLON INFRASTRUCTURE LIMITED AT J AISALMER WHICH WAS DENIED BY THE A.O BUT WHICH WAS ALLOWED BY THE LD. CIT(A). 3 3.2 SECOND GROUND PERTAINS TO DISALLOWANCE OF HIGHER DEPRECIATION IN RESPECT OF WIND MILL INSTALLED AT COIMBATORE AND S ADIYA. WE INCORPORATE THE FOLLOWING PAGES OF LD. CIT(A)S ORDER WHICH WILL DEPICT CLEARLY THE FACTS AND LEGAL POSITION ON THE ISSUE: NOW, IN THIS REGARD, IT IS SUBMITTED THAT ASSESSEE COMPANY HAS INSTALLED & PUT TO USE ONE WINDMILL DURING THE F.Y. 2004 - 05 AND AS PER PROVISION OF SEC 80(IA) ASSESSEE COMPANY OPTED A.Y. 2010 - 11 AS INITIAL YEAR AND CLAIMED DEDUCTION IN RESPECT OF INCOME OF WIND FOR THE FIRST TIME DURING THE YEAR UNDER ASSESSMENT. THE RELEVANT PROVISION OF SEC. 80IA READS AS FOLLOWS: 80 - IA: (1) WHERE THE GROSS TOTAL INCOME OF THE ASSESSEE INCLUDES ANY PROFITS AND GAINS DERIVED BY AN UNDERTAKING OR AN ENTERPRISES FROM ANY BUSINESS REFERRED TO IN SUB - S.(4) (SUCH BUSINESS BEING HEREINAFTER REFERRED TO AS THE ELIGIBLE BUSINESS) THERE SHALL, IN A CCORDANCE WITH AND SUBJECT TO THE PROVISIONS OF THIS SECTION, BE ALLOWED IN COMPUTING THE TOTAL INCOME OF THE ASSESSEE A DEDUCTION OF AN AMOUNT EQUAL TO HUNDRED PERCENT OF THE PROFITS AND GAINS DERIVED FROM SUCH BUSINESS FOR TEN CONSECUTIVE ASSESSMENT YEAR S. (5) NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHER PROVISION OF THIS ACT, THE PROFITS AND GAINS OF AN ELIGIBLE BUSINESS TO WHICH THE PROVISIONS OF SUB - S. (1) APPLY SHALL, 4 FOR THE PURPOSES OF DETERMINING THE QUANTUM OF DEDUCTION UNDER THAT SUB - SECTION FOR T HE ASSESSMENT YEAR IMMEDIATELY SUCCEEDING THE INITIAL ASSESSMENT YEAR OR ANY SUBSEQUENT ASSESSMENT YEAR, BE COMPUTED AS IF SUCH ELIGIBLE BUSINESS WERE THE ONLY SOURCE OF INCOME OF THE ASSESSEE DURING THE PREVIOUS YEAR RELEVANT TO THE INITIAL ASSESSMENT YEA R AND TO EVERY SUBSEQUENT ASSESSMENT YEAR UP TO AND INCLUDING THE ASSESSMENT YEAR FOR WHICH THE DETERMINATION IS TO BE MADE. FROM READING OF SUB - S. (1), IT IS CLEAR THAT IT PROVIDES THAT WHERE THE GROSS TOTAL INCOME OF AN ASSESSEE INCLUDES ANY PROFITS AN D GAINS DERIVED BY AN UNDERTAKING OR AN ENTERPRISES FROM ANY BUSINESS REFERRED TO IN SUB - S. (4) I.E. REFERRED TO AS THE ELIGIBLE BUSINESS, THERE SHALL, IN ACCORDANCE WITH AND SUBJECT TO THE PROVISIONS OF THE SECTION, BE ALLOWED, IN COMPUTING THE TOTAL INCO ME OF THE ASSESSEE, A DEDUCTION OF AN AMOUNT EQUAL TO 100% OF THE PROFITS AND GAINS DERIVED FROM SUCH BUSINESS FOR TEN CONSECUTIVE ASSESSMENT YEARS. DEDUCTION IS GIVEN TO ELIGIBLE BUSINESS AND THE SAME IS DEFINED IN SUB - S. (4). SUB - S.(2)PROVIDES OPTION TO THE ASSESSEE TO CHOOSE TEN CONSECUTIVE ASSESSMENT YEARS OUT OF 15 YEARS. OPTION HAS TO BE EXERCISED. IF IT IS NOT EXERCISED, THE ASSESSEE WILL NOT BE GETTING THE BENEFIT. FIFTEEN YEARS IS OUTER LIMIT AND THE SAME IS BEGINNING FROM THE YEAR IN WHICH THE UND ERTAKING OR THE ENTERPRISE DEVELOPS AND BEGINS TO OPERATE ANY INFRASTRUCTURE ACTIVITY ETC. SUB - S. (5) DEALS WITH QUANTUM 5 OF DEDUCTION FOR AN ELIGIBLE BUSINESS. THE WORDS INITIAL ASSESSMENT YEAR ARE USED IN SUB - S. (5) AND THE SAME IS NOT DEFINED UNDER THE PROVISIONS. IT IS TO BE NOTED THAT INITIAL ASSESSMENT YEAR EMPLOYED IN SUB - S. (5) IS DIFFERENT FROM THE WORDS BEGINNING FROM THE YEAR REFERRED TO IN SUB - S. (2). IMPORTANT FACTORS ARE TO BE NOTED IN SUB - S. (5) AND THEY ARE AS UNDER: (1) IT STARTS WI TH NON - OBSTANTE CLAUSE WHICH MEANS IT OVERRIDES ALL THE PROVISIONS OF THE ACT AND OTHER PROVISIONS ARE TO BE IGNORED; (2) IT IS FOR THE PURPOSE OF DETERMINING THE QUANTUM OF DEDUCTION; (3) FOR THE ASSESSMENT YEAR IMMEDIATELY SUCCEEDING THE INITIAL ASSESS MENT YEAR; (4) IT IS A DEEMING PROVISION; (5) FICTION CREATED THAT THE ELIGIBLE BUSINESS IS THE ONLY SOURCE OF INCOME; AND (6) DURING THE PREVIOUS YEAR RELEVANT TO THE INITIAL ASSESSMENT YEAR AND EVERY SUBSEQUENT ASSESSMENT YEAR. 6 FROM READING OF THE ABOVE, IT IS CLEAR THAT THE ELIGIBLE BUSINESS WERE THE ONLY SOURCE OF INCOME, DURING THE PREVIOUS YEAR RELEVANT TO INITIAL ASSESSMENT YEAR AND EVERY SUBSEQUENT ASSESSMENT YEARS. WHEN THE ASSESSEE EXERCISES THE OPTION, THE ONLY LOSSES OF THE YEARS BEGINNING FROM INI TIAL ASSESSMENT YEAR ALONE ARE TO BE BROUGHT FORWARD AND NO LOSSES OF EARLIER YEARS WHICH WERE ALREADY SET OFF AGAINST THE INCOME OF THE ASSESSEE. LOOKING FORWARD TO A PERIOD OF TEN YEARS FROM THE INITIAL ASSESSMENT IS CONTEMPLATED. IT DOES NOT ALLOW THE R EVENUE TO LOOK BACKWARD AND FIND OUT IF THERE IS ANY LOSS OF EARLIER YEARS AND BRING FORWARD NOTIONALLY EVEN THOUGH THE SAME WERE SET OFF AGAINST OTHER INCOME OF THE ASSESSEE AND THE SET OFF AGAINST THE CURRENT INCOME OF THE ELIGIBLE BUSINESS. ONCE THE SET OFF IS TAKEN PLACE IN EARLIER YEAR AGAINST THE OTHER INCOME OF THE ASSESSEE, THE REVENUE CANNOT REWORK THE SET OFF AMOUNT AND BRING IT NOTIONALLY. FICTION CREATED IN SUB - SECTION DOES NOT CONTEMPLATES TO BRING SET OFF AMOUNT NOTIONALLY. FICTION IS CREATED ONLY FOR THE LIMITED PURPOSE AND THE SAME CANNOT BE E XTENDED BEYOND THE PURPOSE FOR WHICH IT IS CREATED I N THE ASSESSEES CASE, THERE IS NO DISPUTE THAT LOSSES INCURRED BY THE ASSESSEE WERE ALREADY SET OFF AND ADJUSTED AGAINST THE PROFITS OF THE EARLIER YEARS. DURING THE ASSESSMENT YEAR 2010 - 11; THE ASSESSEE EXERCISED THE OPTION UNDER S.80(IA) DURING THE RELEVANT PERIOD, THERE WERE NO UNABSORBED DEPRECIATION OR LOSS OF THE ELIGIBLE 7 UNDERTAKINGS AND THE SAME WERE ALREADY ABSORBED IN THE EARLIER YEARS. THE RE IS A POSITIVE PROFIT DURING THE YEAR. IN VIEW OF THIS, THERE IS NO QUESTION OF SETTING OFF NOTIONALLY CARRIED FORWARD UNABSORBED DEPRECIATION OR LOSS AGAINST THE PROFITS OF THE UNIT AND THE ASSESSEE IS ENTITLED TO CLAIM DEDUCTION U/S 80IA ON THE CURRENT ASSESSMENT YEAR ON THE CURRENT YEAR PROFIT. THAT ID. A.O. WHILE PLACING RELIANCE ON SO MANY CASES AS MENTIONED IN THE ORDER AND DISCUSSED THEREIN, IT IS SUBMITTED THAT THE CASES DISCUSSED ABOVE ARE EITHER NOT SQUARELY RELEVANT AND FURTHER THE CASES PERTA INS PRIOR TO AMENDMENT TO SEC. 80 IA BY FINANCE ACT, 1999. THE CASE RELIED UPON BY ID. A.O. I.E. ACIT V/S GOLDMINE SHARE & FINANCE P. LTD. (SUPRA) HAS DULY BEEN CONSIDERED BY HONBLE MADRAS HIGH COURT WHILE DECIDING CASE OF VELAYUDHASWAMY SPINNING MILLS P. LTD. V/S ACIT CONCURRED WITH THE DECISION OF CIT V/S MEWAR OIL & GENERAL MILLS LTD. 271 ITR 311 (RAJ.) OF JURISDICTIONAL HIGH COURT. IN THIS REGARD, WE WISH TO DRAW YOUR ATTENTION TO THE DECISION OF THE MADRAS HIGH COURT IN CASE OF VELAYUDHASWAMY SPINNING MILLS PVT. LTD., VS. ACIT, (2010) 38 DTR 57, 231 CTR (MAD) 368 WHEREIN THE FACT OF THE CASE ARE IDENTICAL TO THE ASSESSEES CASE AND IT HAS BEEN HELD BY HONBLE MADRAS HIGH COURT DEDUCTION UNDER S. 80 - IA - COMPUTATION - ADJUSTMENT OF BROUGHT FORWARD LOSSES AND DEPRECIATION SET OFF IN EARLIER YEARS - AS PER SUB - S. (5) OF S. 8 80 - IA, PROFIT ARE TO BE COMPUTED AS IF SUCH ELIGIBLE BUSINESS IS THE ONLY SOURCE OF INCOME OF THE ASSESSEE - WHEN THE ASSESSEE EXERCISES THE OPTION, ONLY THE LOSSES OF THE YEARS BEGINNING FRO M THE INITIAL ASSESSMENT YEAR ARE TO BE BROUGHT FORWARD AND NOT THE LOSSES OF EARLIER YEARS WHICH HAVE BEEN ALREADY SET OFF AGAINST THE INCOME OF THE ASSESSEE - REVENUE CANNOT NOTIONALLY BRING FORWARD ANY LOSS OF EARLIER YEARS WHICH HAS ALREADY BEEN SET OFF AGAINST OTHER INCOME OF THE ASSESSEE AND SET OFF THE SAME AGAINST THE CURRENT INCOME OF THE ELIGIBLE BUSINESS - FICTION CREATED BY SUB - S. (5) OF S. 80 - IA DOES NOT CO NTEMPLATE SUCH NOTIONAL SET OFF. I N THE INSTANT CASE, ADMITTEDLY, LOSSES INCURRED BY THE AS SESSEE HAVE ALREADY BEEN SET OFF A ND ADJUSTED AGAINST THE PROFITS OF THE EARLIER YEARS - THERE IS A POSITIVE PROFIT DURING THE RELEVANT YEAR - THEREFORE, LOSS OR DEPRECIATION IN THE YEAR EARLIER TO INITIAL ASSESSMENT YEAR ALREADY ABSORBED AGAINST THE PROFIT OF OTHER BUSINESS CANNOT BE NOTIONALLY BROUGHT FORWARD AND SET OFF AGAINST THE PROFITS OF THE ELIGIBLE BUSINESS - ALL THE AUTHORITIES BELOW HAVE GIVEN A CATEGORICAL FINDING THAT THE FIRST YEAR OF ASSESSEES CLAIM FOR DEDUCTION UNDER S. 80 - IA IS 2004 - 05 AND THE SAME HAS REACHED FINALITY - THERE IS NO ERROR OR ILLEGALITY IN THE ORDER OF THE TRIBUNAL WARRANTING INTERFERENCE. IN THE AFORESAID CASE THEY HAVE CONCURRED WITH THE DECISION OF RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. MEWAR OIL AND GENERAL MILLS LIMI TED (2004) 271 ITR 311 WHICH IS PERTAINING TO S. 801(6) WHICH IS THE CORRESPONDING 9 PROVISIONS OF SUB - SECTION 5 OF SECTION 80IA. WE ARE ENCLOSING HEREWITH A COPY OF THE AFORESAID CASE LAWS FOR YOUR READY REFERENCE. FURTHER YOUR HONOUR MAY PLEASE PLACE RELIA NCE AS ACIT V/S. EVEREADY SPINNING MILLS LTD. (2012) 14 ITR (TRI.) 491 (CHENNAI) AND RANGAMMA STEELS & MALLEABLES V/S ACIT (2010) 43 DTR 137 IN SUPPORT OUR CONTENTION. YOUR HONOUR MAY PLEASE OBSERVE THAT IN THE CASE OF MADHAV MARBLE & GRANITES LTD., ID. CI T(A), UDAIPUR HAS ALSO ALLOWED CLAIM OF DEDUCTION U/S 80IA AND OUR CASE IS SQUARELY COVERED BY THE SAME. THEREFORE CONSIDERING FACTS & CIRCUMSTANCES OF THE CASE, WE REQUEST YOUR HONOUR TO PLEASE ALLOW DEDUCTION U/S 80IA CLAIMED BY THE ASSESSEE AND DELETE T HE ADDITION MADE ON THIS ACCOUNT. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT AS WELL AS THE FINDINGS OF THE LD. AO. KEEPING INTO CONSIDERATION THE VARIOUS CASE LAWS OF THE HIGHER APPELLATE AUTHORITIES AND THE HONBLE COURTS I INCLINE TO AGREE WITH THE CONTENTION OF THE APPELLANT THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. AO IS NOT JUSTIFIED IN DISALLOWING THE CLAIM OF DEDUCTION U/S 80IA OF RS. 52,86,966/ - IN RESPECT OF COMPANYS JAISALMER WIND POWER UNIT AND THE DISALLOWANCE OF CLAIM U /S 80IA IS DELETED. 10 FURTHER, IT IS OBSERVED THAT IN THE CASE OF MADHAV MARBLE & GRANITES LTD., MY LD. PREDECESSOR HAS ALSO ALLOWED THE CLAIM OF DEDUCTION U/S 80IA IN 112/IT/UDR/2009 - 10 IN AY 2007 - 08 WHICH HAS BEEN CONFIRMED BY THE HONBLE JURISDICTION; ITAT VIDE THEIR ORDER IN ITA NO. 390 & 200 /JODH/2011 & 2013 RESPECTIVELY FOR AYRS. 2007 - 08 & 2008 - 09. THE FACTS AND CIRCUMSTANCES OF THE CASE OF THE APPELLANT ARE IDENTICAL TO THE FACTS AND CIRCUMSTANCES OF THE CASE OF M/S MADHAV MARBLE & GRANITES LTD. KEEPING INTO ENTIRETY OF THE CASE RESPECTFULLY FOLLOWING THE DECISIONS MENTIONED ABOVE I HAVE NO REASON TO DEVIATE, AND THE DISALLOWANCE OF THE CLAIM OF DEDUCTION U/S 80IA OF RS. 52,86,966/ - IN RESPECT OF COMPANYS JAISALMER WIND POWER UNIT IS DELETED. THI S GROUND OF APPEAL IS ALLOWED. GROUND NO. 2: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. JCIT, R - 2, UDAIPUR HAS ERRED IN DISALLOWING DEPRECIATION OF RS. 31,64,509/ - IN RESPECT OF WIND POWER UNIT AT COIMBATORE ON THE BASIS OF ASSESSMENT ORDER PAS SED FOR THE AY 2009 - 10. THE DISALLOWANCE OF DEPRECIATION OF R S . 31,64,509/ - I.E. RESTRICTING DEPRECIATION ALLOWANCE TO RS. 2,64,77,518/ - AGAINST CLAIM OF THE ASSESSEE COMPANY RS. 2,96,42,027/ - IS BAD IN LAW AND LIABLE TO BE DELETED . FURTHER ISSUE IS SQUAR ELY COVERED BY THE DECISION OF HONBLE ITAT IN ASSESSEE OWN CASE FOR THE AY 2008 - 09. 11 GROUND NO. 3: - ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE LD. JCIT, R - 2, UDAIPUR HAS ERRED IN DISALLOWING DEPRECIATION OF RS. 2,03,297/ - IN RESPECT OF WIND POWER U NIT AT SADIYA ON THE BASIS OF ASSESSMENT ORDER PASSED FOR THE AY 2009 - 10. THE DISALLOWANCE OF DEPRECIATION OF RS. 2,03,297/ - I.E. RESTRICTING DEPRECIATION ALLOWANCE TO RS. 32,86,157/ - AGAINST CLAIM OF THE ASSESSEE COMPANY RS. 34,89,454 IS BAD IN LAW AND LI ABLE TO BE DELETED. FURTHER ISSUE IS SQUARELY COVERED BY THE DECISION OF THE HONBLE ITAT IN ASSESSEE OWN CASE FOR THE AY 2008 - 09. BOTH THE ABOVE GROUNDS ARE INTER - LINKED . HENCE, THEY ARE BEING DEALT WITH TOGETHER. THE LD. AO, WHILE MAKING THE ASST, U/S 1 43 (3) OF I.T. ACT HAS DISALLOWED DEPRECIATION ON WIND POWER UNIT AT COIMBTURE INSTALLED & PUT TO USE DURING THE F.Y. 2008 - 09 ON FOUNDATION WORK AND ELECTRICAL ITEMS IN RESPECT OF WIND MILL INSTALLED & PUT TO USE BY ALLOWING DEPRECIATION @ 10% & 15% RESPEC TIVELY AGAINST THE CLAIM OF ASSESSEE @ 80%, THEREBY MAKING ADDITION OF RS. 31,64,869/ - AGAINST DEPRECIATION CLAIMED DURING THE YEAR. LIKEWISE IN RESPECT OF OLD WIND MILL AT SADIYA, JAISALMER INSTALLED & PUT TO USE DURING THE FINANCIAL YEAR 2007 - 2008 RELEV A NT TO A.Y. 2008 - 2009 DEPRECIATION IS DIS ALLOWED ON W.D.V. CALCULATED BY THE DEPT, AS PER ASST, ORDER OF ASST, YEAR 2008 - 2009 AND DISALLOWED DEPRECIATION OF RS.2,03,297/ - OUT OF DEPRECIATION CLAIMED DURING THE YEAR. 12 THE WORKING CHART DRAWN BY THE A.O. IS R EPRODUCED AS UNDER: - WIND MILL (COIMBTURE) ITEM WDV RATE OF DEP N. DEPRECIATION ALLOWABLE FOUNDATION WORK AND TRANSFORMER PLINTH 41,53,399/ - 10% 4,15,340/ - COST OF WIND MILL, TOWER AND INSTALLATION CHARGES 3,10,87,980/ - 80% 2,48,70,384/ - TRANSFORMER AND ELECTRIC COMPONENT 7,63,800/ - 80% 6,11,040/ - ELECTRICAL ITEMS AND INSTALLATION 38,71,699 15% 5,80,754/ - 2,64,77,518/ - DEPRECIATION CLAIMED AS PER RETURN IN RESPECT OF WIND MILL - 1 2,96,42,027/ - EXCESS CLAIMED 31,64,869 WIND MILL (SADIYA) ITEM WDV RATE OF DEPRECIAT ION DEPRECIATION ALLOWABLE FOUNDATION WORK AND TRANSFORMER PLINTH 22,75,629/ - 10% 2,27,563/ - COST OF WIND MILL, TOWER AND INSTALLATION CHARGES 34,15,743/ - 80% 27,32,594/ - TRANSFORMER AND ELECTRIC COMPONENT 2,10,229/ - 80% 1,68,183/ - ELECTRICAL ITEMS AND INSTALLATION 10,52,114/ - 15% 1,57,817/ - 32,86,157/ - DEPRECIATION CLAIMED AS PER RETURN IN RESPECT OF WIND MILL - 1 34,89,454/ - 13 THEREFORE TOTAL DEPRECI ATION DISALLOWED RS. 33,68,166/ . HENCE, THE ABOVE GROUNDS OF APPEAL. DURING TH E COURSE OF APPELLATE PROCEEDING THE LD. AR SUBMITTED AS UNDER : GROUND NO. 2 & 3 : DEPRECIATION ON WIND MILL IN THIS REGARD IT IS SUBMITTED THAT THE CASE WAS DISCUSSED IN DETAIL IN ASSESSEES CASE DURING THE APPELLATE PROCEEDING FOR THE ASST, YEAR 2008 - 2009 AND WAS HAS ALLOWED IN APPEAL NO. 72/IT/UDR/2010 - 11 VIDE ORDER DT. 28/02/2012, IN WHICH ID. COMMISSIONER OF INCOME TAX(APPEALS), UDAIPUR HAS HELD ON PAGE 12 THAT DEPRECIATION ON FOUNDATION WORK AND TRANSFORMER PLINTH AND DEPRECIATION ON INSTALLATI ON AND ELECTRICAL LINES ETC IS HELD TO BE ALLOWABLE AT WHICH RATE DEPRECIATION IS ALLOWABLE ON WIND MILL AND THEREFORE DISALLOWANCE OF DEPRECIATION MADE BY A.O. ON THE ABOVE ITEMS IS DELETED AND THIS GROUND OF APPEAL IS ALLOWED. COPY OF ORDER DT. 28/02/ 2012 IS ENCLOSED. FURTHER AGAINST THE ORDER FOR THE A.Y. 2008 - 09 DEPARTMENT FILED APPEAL BEFORE HBLE ITAT AND SAME WAS DISMISSED BY THE HBLE ITAT, JODHPUR BENCH, JODHPUR VIDE APPEAL NO. ITA/193/JU/2012 ORDER DT. 14/12/2012. COPY OF THE SAME IS ENCLOSED. 14 THEREFORE , OUR ABOVE CASE IS SQUARELY COVERED B Y APPELLANTS CASE FOR THE ASST YEAR 2008 - 2009 AND REQUEST YOUR HONOUR TO PLEASE DELETE THE ADDITIONS MADE BY A.O. ON ACCOUNT OF DEPRECIATION ON WIND MILLS AND OBLIGE. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT AS WELL AS THE FINDINGS OF THE LD. AO. KEEPING INTO CONSIDERATION THE VARIOUS CASE LAWS OF THE HIGHER APPELLATE AUTHORITIES AND THE HONBLE COURTS I INCLINE TO AGREE WITH THE CONTENTION OF THE APPELLANT THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. AO IS NOT JUSTIFIED IN DISALLOWING THE TOTAL DEPRECIATION DISALLOWED RS. 33,68,166/ - IS LIABLE TO BE DELETED BECAUSE THE ISSUE WAS DISCUSSED IN DETAIL IN ASSESSEES CASE DURING THE APPELLATE PROCEEDING FOR THE ASST, YEAR 2008 - 2009 AND IT WAS ALLOWED IN APPEAL NO. 72/IT/UDR/2010 ? 4ID4DE ORDER DT. 28/02/2012, BY MY PREDECESSOR WITH THE FOLLOWING OBSERVATION : - DEPRECIATION ON FOUNDATION WORK AND TRANSFORMER PLINTH AND DEPRECIATION ON INSTALLATION AND ELECTRICAL LINES ETC IS HELD TO BE ALLOW ABLE AT WHICH RATE DEPRECIATION IS ALLOWABLE ON WIND MILL AND THEREFORE DISALLOWANCE OF DEPRECIATION MADE BY A. O. ON THE ABOVE ITEMS IS DELETED AND THIS GROUND OF APPEAL IS ALLOWED.' 15 FURTHER AGAINST THE ORDER FOR THE A.Y. 2008 - 09 THE DEPARTMENT HAD FILED APPEAL BEFORE THE HONBLE ITAT AND THE SAME WAS DISMISSED VIDE ITA. NO.193/JU/2012 ORDER DT. 14/12/2012. THE FACTS AND CIRCUMSTANCES OF THE APPELLANTS CASE ARE SAME AND IDENTICAL DURING THE YEAR UNDER CONSIDERATION HENCE, I HAVE NO REASON TO DEVIATE FROM THE ABOVE DECISIONS IN THE APPELLANTS OWN CASE. ACCORDINGLY, THE DISALLOWANCE OF DEPRECIATION AMOUNTING TO RS. 33,68,166/ - IS DELETED. THE ABOVE GROUNDS OF APPEAL ARE ALLOWED. ACCORDINGLY, WE SATISFY THAT BOTH THE ISSUES INVOLVED IN THIS APPEAL STAND CO VERED AS DISCUSSED IN THE ABOVE PARAS BY LD. CIT(A) WE ARE IN AGREEMENT WITH HIM AND ACCORDINGLY CONFIRM THE IMPUGNED DELETION. ACCORDINGLY, WE CANNOT ALLOW THE APPEAL OF THE REVENUE. 4 . IN THE RESU LT, THE APPEAL OF THE REVENUE IN ITA NO. 288 /JU/2014 STA NDS DISMISSED. ORDER PRON OUNCED IN THE COURT ON 12 TH AUGUST , 2014. SD/ - SD/ - (N.K.SAINI) [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEM B ER DATED : 12 TH AUGUST , 201 4 VL/ - 16 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR SENIOR PRIVATE SECRETARY ITAT, JODHPUR