M/S KISHANGARH HI TECH TEXTILE PARK LTD., KISHANGARH V. ASSISTANT COMMISSIONER OF INCOME TAX (TECH), AJMER

ITA 326/JPR/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1354 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 9 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 07-03-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BK GUPTA
• Assessee Lawyers: S S NAGAR
• Keywords: Depreciation; Reason to believe
• Section: 143(3); 13

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S B JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA. NO. 325 & 326/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12 & 2012-13 M/S KISHANGARH HI-TECH TEXTILE PARK LTD., AGARWAL SADAN, BHAT MOHALLA, MADANGANJ, KISHANGARH-305801. CUKE VS. THE ACIT, (TECH), AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AACCK 8174 C VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA. NO. 327 & 328/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14 & 2014-15 M/S KISHANGARH HI-TECH TEXTILE PARK LTD., AGARWAL SADAN, BHAT MOHALLA, MADANGANJ, KISHANG ARH - 305801. CUKE VS. THE ACIT, CIRCLE-1, AJMER. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AACCK 8174 C VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI S. S. NAGAR (C.A) JKTLO DH VKSJ LS @ REVENUE BY : SHRI B.K. GUPTA (CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 26/11/2019 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 11/12/2019 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THESE ARE FOUR APPEALS FILED BY THE ASSESSEE AGAIN ST THE RESPECTIVE ORDERS OF LD. CIT(A), AJMER DATED 06.12.2017 FOR A. Y 2011-12 TO 2014-15 ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 2 RESPECTIVELY. SINCE THE COMMON ISSUES ARE INVOLVED, ALL THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY T HIS CONSOLIDATED ORDER. 2. FOR THE SAKE OF PRESENT DISCUSSION, WITH THE CON SENT OF THE PARTIES, THE MATTER PERTAINING TO A.Y.2011-12 IN ITA NO. 325 /JP/2018 HAS BEEN TAKEN AS A LEAD CASE WHEREIN THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL: THAT THE DISALLOWANCE OF DEPRECIATION OF RS. 150,7 77,715/- AND THE APPLICATION OF PROVISION OF SECTION 43(1), REDUCING THE COST OF THE ASSET BY THE SUBSIDY AMOUNT UNDER THE SITP SCHEME C ONFIRMED BY THE LD. CIT(APPEALS) IS UNJUSTIFIED AND IS BAD IN L AW AND THE FACTS OF THE CASE. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE COMPANY HAS BEEN INCORPORATED AS A SPECIAL PURPOSE VEHICLE (SPV) FOR THE PURPOSES OF DEVELOPING A TEXTILE PARK UNDER SCHEME FOR INTEG RATED TEXTILE PARK (SITP SCHEME) OF THE CENTRAL GOVERNMENT. AS PART OF THE SAID SCHEME, THE ASSESSEE HAS RECEIVED GRANT/SUBSIDY OF RS. 24 CRORE S DURING THE YEAR UNDER CONSIDERATION AND AN AMOUNT OF RS. 12 CRORE WAS REC EIVED IN THE F.YS. 2007-08 & 2008-09. ACCORDINGLY, THE ASSESSEE HAS RE CEIVED A TOTAL SUBSIDY/GRANT AMOUNTING TO RS. 36 CRORES. DURING T HE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS INSTALLED AND CAPIT ALIZED ASSETS UNDER THE HEAD WIND POWER PROJECT AMOUNTING TO RS. 45.72 CR ORES AND HAS CLAIMED DEPRECIATION THEREON @ 80% OF THE VALUE SO CAPITALI ZED. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, A SHOW CAUSE WAS ISSUED TO THE ASSESSEE DATED 28.02.2014 WHEREIN THE ASSESSEE WAS ASKED TO SHOW C AUSE AS TO WHY GRANT/SUBSIDY RECEIVED BY THE ASSESSEE SHOULD NOT B E REDUCED FROM THE ACTUAL COST FOR THE PURPOSE OF COMPUTATION OF DEPRE CIATION AS PER THE ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 3 PROVISIONS OF SECTION 43(1) OF THE ACT. AFTER CONS IDERING THE SUBMISSION OF THE ASSESSEE, THE AO PASSED THE ORDER U/S 143(3) DATED 27.03.2014 WHEREIN THE AMOUNT OF SUBSIDY WAS REDUCED FROM THE TOTAL INVESTMENT MADE BY THE ASSESSEE IN THE WIND POWER PROJECT AND DEPRECIATION ON THE REDUCED COST OF RS. 9.72 CRORES WAS ALLOWED INVOKIN G THE PROVISIONS OF SECTION 43(1) READ WITH EXPLANATION 10 THERETO. FU RTHER, THE ASSESSING OFFICER HAS ALLOWED DEPRECIATION AT VARYING RATES O N VARIOUS ASSETS CLASS COMPRISING THE WIND POWER PROJECT AS AGAINST 80% CL AIMED BY THE ASSESSEE COMPANY. ACCORDINGLY, THE ASSESSMENT WAS COMPLETED AT AN ASSESSED LOSS OF RS. 3,50,70,900/- BY MAKING DISALLOWANCE OF RS. 15,07,77,715 ON ACCOUNT OF EXCESS DEPRECIATION CLAIMED BY THE ASSES SEE COMPANY. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEA L BEFORE THE LD. CIT(A) WHO HAS SUSTAINED THE SAME DISALLOWANCE AND AGAINST HIS FINDING, THE ASSESSEE IS IN APPEAL BEFORE US. 4. DURING THE COURSE OF HEARING, THE LD. AR SUBMIT TED THAT THE APPELLANT HAS RECEIVED SUBSIDY/GRANT OF INR 36 CRS FROM CENTR AL GOVT. (MINISTRY OF TEXTILE) UNDER SCHEME FOR INTEGRATED TEXTILE PARK. THE PRIMARY OBJECTIVE OF THE SITP SCHEME IS TO PROVIDE THE INDUSTRY WITH WOR LD CLASS INFRASTRUCTURE FACILITIES FOR SETTING UP THEIR TEXTILE UNITS TO ME ET INTERNATIONAL ENVIRONMENTAL AND SOCIAL STANDARDS. IT WAS SUBMITTED THAT THE AO HAS WRONGLY REDUCED THE AMOUNT OF SUBSIDY OF RS 36 CRS FROM THE TOTAL INVES TMENT OF RS 45.72 CRS. MADE BY THE APPELLANT IN WIND POWER PROJECT WHICH I S THE ACTUAL COST OF THE ASSETS CLAIMED BY THE APPELLANT AND ALLOWED DEPRECI ATION ON RS 9.72 CRS. I.E. RS (45.72 CRS - 36 CRS). IT WAS SUBMITTED THAT CHANDIGARH BENCH OF THE TRIBUNAL IN THE SAID CASE OF LOTUS INTEGRATED TAXPA RK VS. DCIT (ITA NO. 1138/CHD/2014) HAS ALLOWED IDENTICAL CLAIM IN RESPE CT OF GRANT OF DEPRECIATION WITHOUT REDUCING THE GRANT RECEIVED FR OM MINISTRY OF TEXTILES BY HOLDING THAT EXPLANATION 10 TO SECTION 43(1) IS NOT APPLICABLE. FURTHER ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 4 RELIANCE WAS PLACED ON THE DECISIONS IN CASE OF SAS ISRI EXTRACTIONS VS. ACIT 122 ITD 428 (VIZAG), INVENTAA CHEMICAL LTD VS CIT 42 SOT 249 (HYD) AND SOHAN ELECTROPLAST PVT. LTD. VS. ITO 1578 /PN/2008 (PUNE). 5. IT WAS FURTHER SUBMITTED THAT THE APPELLANT HAD CLAIMED DEPRECIATION @ 80% ON THE ENTIRE INVESTMENT OF RS 45.72 CRS MADE IN THE WIND POWER PROJECT AND SINCE THE ASSETS WERE USED FOR LESS THA N 180 DAYS, DEPRECIATION HAS BEEN CLAIMED AS HALF THE NORMAL RATE @ 40%. TH E AO HAS HOWEVER WRONGLY ALLOWED DEPRECIATION AT DIFFERENT RATES AS PROVIDED UNDER APPENDIX 1A OF THE I.T. RULES FOR DIFFERENT BLOCKS OF ASSETS COMPRISING THE WIND POWER PROJECT BIKE POWER EVACUATIONS, CIVIL WORK FO R WIND MILL FOUNDATION, HT ELECTRICAL YARD AND TRANSMISSION, LEASE OF LAND & ERECTION AND INSTALLATION WORK & COMMISSIONING. RELIANCE IN THIS REGARD WAS PLACED ON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN TH E CASE OF PR. CIT - VS. GANGAUR EXPORTS PVT. LTD (ITA NO. 14 OF 2017) WHEREIN IT HAS BEEN HELD THAT DEPRECIATION @ 80 % HAD TO BE ALLOWED ON WIND TURBI NE MACHINE WITHOUT SEGREGATING INVESTMENT ON BUILDING PART AND ON ELEC TRIC ITEM SINCE SUCH CIVIL STRUCTURE, ELECTRIC FITTING, EQUIPMENTS ARE PART AN D PARCEL OF THE WINDMILL AND CANNOT BE SEPARATED FROM THE SAME. RELIANCE WAS ALSO PLACED ON THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN CASE OF CIT VS. K.K. ENTERPRISES (ITA NO. 53 OF 2012), CIT VS. MEHRU ELECTRICALS & MECHANICAL ENGINEERS (ITA NO. 135 OF 2014) AND OF THE JAIPUR BENCH OF THE TRIBUNAL IN THE CAS E OF DCIT VS. VENKATESWARA WIRES PVT. LTD (ITA NO. 53/JP/2018). 6. PER CONTRA, THE LD. DR SUBMITTED THAT THE CONTEN TION OF THE LD. AR THAT SCHEME WAS INTENDED TO ENCOURAGE GROUP OF ENTR EPRENEURS TO COME TOGETHER AND ESTABLISH INTEGRATED TEXTILE PARKS WIT H WORLD CLASS INFRASTRUCTURE AND THEREFORE, THE GRANT SO RECEIVED IS NOT RECEIVED AGAINST THE ACTUAL COST OF ASSETS CANNOT BE ACCEPTED. IN T HIS REGARD, THE LD. DR ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 5 REFERRED TO THE ASSESSEES PAPER BOOK AND MINISTRY OF TEXTILE, GOVT. OF INDIA LETTER DATED 07.05.2011 WHEREIN IT HAS BEEN S TATED CLEARLY THAT THE GRANT IS TO BE UTILIZED FOR THE PURPOSE OF APPROVED COMPONENTS OF INTEGRATED TEXTILE PARK VIZ FACTORY BUILDING ETC AN D AS PER THE POINT NO. 2.2 OF THE SITP SCHEME, THE SUBSIDY RECEIVED UNDER SITP HAS TO BE USED FOR THE APPROVED COMPONENT OF TEXTILE PARK I.E. LAND, COMMO N INFRASTRUCTURE, BUILDING FOR COMMON FACILITY, FACTORY BUILDING, PLA NT & MACHINERY ETC. IT WAS SUBMITTED THAT THE SCHEME WAS TO PROVIDE FINANCIAL ASSISTANCE TO MEET DIRECTLY THE COST OF THE ASSETS. FURTHER, OUR REFER ENCE WAS DRAWN TO THE UTILIZATION CERTIFICATES DATED 22.07.2008, 18.02.20 10, 01.01.2010 AND 10.11.2014, DULY CERTIFIED BY THE ASSESSEE COMPANY AND AN INDEPENDENT CHARTERED ACCOUNTANT, SUBMITTED TO THE MINISTRY OF TEXTILES WHICH SHOWS CLEARLY THAT THE GRANT HAS BEEN UTILIZED AGAINST TH E VARIOUS INDIVIDUAL ASSET CLASSES. FURTHER, OUR REFERENCE WAS DRAWN TO THE DE PARTMENTS PAPER BOOK WHICH CONTAINS SUMMARY OF THE GRANT GIVEN BY THE MI NISTRY OF TEXTILE, GOVT. OF INDIA AND UTILIZATION OF THE THEREOF AS UNDER:- S.NO. GRANTS RECEIVED TILL DATE TILL 28 - FEB. - 11 (RS. LAKHS) FROM 1 - MAR - 2011 31-MAR-2011 (RS. LAKHS) TOTAL TILL 31 - MAR - 11 (RS. LAKHS) 1. FIRST INSTALLMENT (10%) 400.00 - 400.00 2. SECOND INSTALLMENT (20%) 800.00 - 800.00 3. THIRD INSTALLMENT (30%) 1,200.00 - 1200.00 4. FOURTH INSTALLMENT (30%) 1200.00. - 1200.00 5. FIFTH INSTALLMENT (10%) - - - TOTAL AMOUNT RECEIVED TILL 09 FEBRUARY 2011 3,600.00 - 3,600.00 UTILISATION OF GOL GRANT TILL 28 - FEB. - 11 (RS. LAKHS) FROM 1 - MAR - 2011 31-MAR-2011 (RS. LAKHS) TOTAL TILL 31 - MAR - 11 (RS. LAKHS) 1. SITE DEV. & COMMON INF RA. 1,283.65 435.80 1,719.45 2. COMMON FACILITIES 314.15 - 314.15 ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 6 3. FACTORY BUILDING 637.63 280.35 917.98 4. DESIGN ENGINEERING AND SUPERVISION FEES 164.56 4.51 169.07 5. DRAFT MAKING CHARGES 0.01. - 0.01 TOTAL AMOUNT UTILISED 2,400.00 720.66 3,120.66 BALANCE UNUTILISED GOL GRANT IN TRA (RS. LACS) 1,200.00 479.34 7. IT WAS SUBMITTED BY THE LD CIT DR THAT THE SCHEM E WAS THEREFORE TO PROVIDE FINANCIAL ASSISTANCE TOWARDS DIRECTLY MEETI NG THE ACTUAL COST OF THE ASSETS AND THE ASSESSEE HAS ALSO FURNISHED THE UTIL IZATION CERTIFICATES THAT THE GRANT HAS BEEN ACTUALLY UTILIZED AGAINST THE SP ECIFIED ASSETS SO SPECIFIED. IT WAS ACCORDINGLY SUBMITTED THAT THE GRANT SANCTIO NED BY THE MINISTRY OF TEXTILE, GOVT. OF INDIA UNDER THE SCHEME OF SITP DI RECTLY RELATES TO THE COST OF THE ASSETS AND THE SAME IS REQUIRED TO BE REDUCE D FROM THE ACTUAL COST WHILE COMPUTING THE DEPRECIATION AS PER THE PROVISI ON OF SECTION 43(1) READ WITH EXPLANATION 10 THERETO. 8. REGARDING THE RATE OF DEPRECIATION APPLIED BY TH E ASSESSING OFFICER, OUR REFERENCE WAS DRAWN TO THE VARIOUS ASSETS WHICH HAS BEEN PURCHASED/INSTALLED IN RESPECT OF WIND POWER PROJEC T AND THE RELEVANT FINDINGS OF THE ASSESSING OFFICER IN THE ASSESSMENT ORDER WHICH READS AS UNDER:- 1. ON VERIFICATION OF THE DETAILS OF ASSETS PURCHA SE DURING THE YEAR IN RESPECT OF WIND POWER PROJECT, IT REVEALS THAT THE ASSESSEE HAS INSURED THE EXPENSES FOR THE PURCHASE OF ASSETS AND TO PROVIDE FACILITIES AS UNDER:- (A) RELEVANT TO MACHINERY (WINDMILL) RS. 34,44,40,0 00 (B) TOWARDS CONTRIBUTION OF POWER- EVACUATION INFRASTRUCTURE FACILITIES. ( FOR WTC OF MV) RS. 2,77,95,600 ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 7 (C) CIVIL WORK CONSTRUCTION OF WIND MILL FOUNDATION RS. 3,16,52,480 (D) SUPPLY AND INSTALLATION OF IT ELECTRICAL YARD AND TRANSMISSION LINE RS. 2,78,62,512 (E) LEASE OF LAND RS. 88,24,000/- (F) ERECTION AND INSTALLATION WORK AND COMMISSIONING RS. 1,27,94,800/- TOTAL 45,33,69,392/- ADD: INSURANCE CAPITALIZED IN WPP RS. 283222 ADD: BANK INTEREST ON LOAN FOR WPP CAPITALIZED RS . 35,50,720 TOTAL OF WIND POWER PROJECT RS. 45,72,03,334 9. IT WAS ACCORDINGLY SUBMITTED BY THE LD CIT DR TH AT THE AO HAS RIGHTLY ALLOWED THE DEPRECIATION AS PRESCRIBED UNDER APPEND IX 1A AS UNDER:- RATE (A) RELEVANT TO MACHINERY (WINDMILL) 80 (B) TOWARDS CONTRIBUTION FOR POWER-EVACUATION 15 % INFRASTRUCTURE FACILITIES. (FOR-WTC OF MW) (C) CIVIL WORK CONSTRUCTION OF WIND MILL FOUNDATION 10% (D) SUPPLY AND INSTALLATION OF HT ELECTRICAL YARD A ND TRANSMISSION LINE 15% (E) LEASE OF LAND NIL (F) ERECTION AND INSTALLATION WORK AND COMMISSIONIN G 15% 10. IT WAS ACCORDINGLY SUBMITTED BY THE LD CIT DR T HAT THERE IS NO INFIRMITY IN THE ACTION OF THE AO IN NOT ALLOWING T HE DEPRECIATION @ 80% AS ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 8 CLAIMED BY THE ASSESSEE. HE ACCORDINGLY REQUESTED F OR CONFIRMATION OF THE ORDER PASSED BY THE LOWER AUTHORITIES. 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND PURSUED THE MATERIAL AVAILABLE ON RECORD. THE ISSUE UNDER CONSIDERATION IS WHETHER GRANT SO RECEIVED BY THE ASSESSEE FROM THE MINISTRY OF TEXTI LES HAS TO BE REDUCED FROM THE ACTUAL COST OR NOT FOR THE PURPOSE OF ALLO WANCE OF DEPRECIATION. THE TERM ACTUAL COST HAS BEEN DEFINED IN SECTION 43(1) OF THE ACT. IT PROVIDES THAT THE ACTUAL COST MEANS THE ACTUAL COST OF THE ASSET TO THE ASSESSEE REDUCED BY THAT PORTION OF THE COST THEREO F, IF ANY, AS HAS BEEN MET DIRECTLY OR INDIRECTLY BY ANY OTHER PERSON OR A UTHORITY. FURTHER EXPLANATION 10 TO SECTION 43(1) PROVIDES AS UNDER:- EXPLANATION 10- WHERE A PORTION OF THE COST OF AN ASSET ACQUIRED BY THE ASSESSEE HAS BEEN MET DIRECTLY OR INDIRECTLY BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT OR ANY AUTHORITY E STABLISHED UNDER ANY LAW OR BY ANY OTHER PERSON, IN THE FORM O F A SUBSIDY OR GRANT OR REIMBURSEMENT (BY WHATEVER NAME CALLED), T HEN, SO MUCH OF THE COST AS IS RELATABLE TO SUCH SUBSIDY OR GRANT O R REIMBURSEMENT SHALL NOT BE INCLUDED IN THE ACTUAL COST OF THE ASS ET TO THE ASSESSEE: PROVIDED THAT WHERE SUCH SUBSIDY OR GRANT OR REIMBU RSEMENT IS OF SUCH NATURE THAT IT CANNOT BE DIRECTLY RELATABLE TO THE ASSET ACQUIRED, SO MUCH OF THE AMOUNT WHICH BEARS TO THE TOTAL SUBS IDY OR REIMBURSEMENT OR GRANT THE SAME PROPORTION AS SUCH ASSET BEARS TO ALL THE ASSETS IN RESPECT OF OR WITH REFERENCE TO W HICH THE SUBSIDY OR GRANT OR REIMBURSEMENT IS SO RECEIVED, SHALL NOT BE INCLUDED IN THE ACTUAL COST OF THE ASSET TO THE ASSESSEE. 12. IN THE INSTANT CASE, WHAT IS THEREFORE RELEVAN T TO DETERMINE IS WHETHER THE COST OF THE ASSET SO ACQUIRED BY THE AS SESSEE COMPANY HAS ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 9 BEEN MET DIRECTLY OR INDIRECTLY BY THE MINISTRY OF TEXTILE, GOVERNMENT OF INDIA. IF THE ANSWER TO THE SAME IS IN AFFIRMATIVE , THAT IN SUCH CASE, SO MUCH OF THE COST AS IS RELATABLE TO SUCH SUBSIDY OR GRANT SHALL NOT BE INCLUDED IN THE ACTUAL COST OF THE ASSET TO THE ASS ESSEE COMPANY. IT HAS BEEN FURTHER PROVIDED THAT WHERE SUCH SUBSIDY OR GR ANT IS OF SUCH NATURE THAT IT CANNOT BE DIRECTLY RELATABLE TO THE ASSET A CQUIRED, SO MUCH OF THE AMOUNT WHICH BEARS TO THE TOTAL SUBSIDY OR GRANT TH E SAME PROPORTION AS SUCH ASSET BEARS TO ALL THE ASSETS IN RESPECT OF OR WITH REFERENCE TO WHICH THE SUBSIDY OR GRANT OR REIMBURSEMENT IS SO RECEIVE D, SHALL NOT BE INCLUDED IN THE ACTUAL COST OF THE ASSET TO THE ASSESSEE. 13. IN THIS REGARD, WE NOTE THAT THE ASSESSEES PRO POSAL UNDER THE SCHEME FOR INTEGRATED TEXTILE PARK (SITP) WAS CONSI DERED BY THE PROJECT APPROVAL COMMITTEE (PAC) OF THE MINISTRY OF TEXTILE S, GOVERNMENT OF INDIA IN ITS MEETING HELD ON 01.07.2006 AND GRANT OF RS 4 0 CRORES WAS APPROVED AND THE ASSESSEE WAS DIRECTED TO TAKE APPROPRIATE A CTION AS PER THE DECISION OF THE PAC AND SUBMIT CLAIM FOR RELEASE OF FIRST INSTALLMENT OF GOVERNMENT OF INDIA GRANT. THEREAFTER, AS PER MINI STRY OF TEXTILE LETTER DATED 11 TH JUNE, 2007, THE SANCTION WAS CONVEYED FOR RELEASE OF FIRST INSTALLMENT OF GRANT-IN-AID OF RS. 4 CRORES AGAINST THE APPROVED COMPONENTS OF THE TEXTILE PARK VIZ. LAND DEVELOPMENT COST, COM MON INFRASTRUCTURE, BUILDING FOR COMMON FACILITIES, FACTORY BUILDING AN D TECHNICAL FEES AND THE ASSESSEE WAS ASKED TO SUBMIT THE UTILIZATION CERTIF ICATE. IT WOULD BE RELEVANT TO REFER TO THE CONTENTS OF THE SAID LETTE R DATED 11.06.2007 WHICH ARE REPRODUCED IN VERBATIM AS UNDER: ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 10 SUB:- GRANT-IN-AID TO M/S KISHANGARH HI-TECH TEXTI LE PARK LTD. SILORA, KISHANGARH, RAJASTHAN UNDER THE SCHEME FOR INTEGRATED TEXTILE PARK. SIR, I AM DIRECTED TO CONVEY THE SANCTION OF THE PRESID ENT OF INDIA FOR PAYMENT OF 1 ST PART OF THE 1 ST INSTALLMENT OF NON RECURRING GRANT- IN-AID OF RS. 4,00,00,000/- (RUPEES FOUR CORES ONLY ) TO M/S KISHANGARH HI-TECH TEXTILE PARK LTD. SILORA, KISHAN GARH, RAJASTHAN DIRECTLY IN THE TRUST AND ESCROW ACCOUNT NO. 028800 2100040821 PUNJAB NATIONAL BANK MAIN CHORAHA MADANGANJ, KISHAN GARH, RAJASTHAN-305801. THIS GRANT IS AGAINST THE APPROVED COMPONENTS OF THE TEXTILE PART VIX LAND DEVELOPMEN T COST, COMMON INFRASTRUCTURE, BUILDING FOR COMMON FACILITI ES, FACTORY BUILDINGS AND TECHNICAL FEES. THE GRANTEE SHALL ENSURE THAT TECHNICAL CLOSURE IS ATTAINED WITHIN A PERIOD OF THREE (3) MONTHS FROM THE DATE OF ISSUE OF THIS SANCTION. THE GRANT- IN-AID IS FURTHER SUBJECT TO FOLLOWING TERMS AND CONDITIONS: I) GRANTS-IN-AID SHALL BE UTILIZED FOR THE PURPOSE IT IS REQUIRED BY M/S KISHANGARH HI-TECH TEXTILE PARK LTD, RAJASTH AN AS PER GUIDELINES OF THE 'SCHEME FOR INTEGRATED TEXTILE PA RKS' SCHEME APPROVED BY THE GOVT. AND SUBJECT TO THE PROVISIONS CONTAINED IN THE GENERAL FINANCIAL RULES. II) THE GRANTEE SHALL EXECUTE A BOND WITH TWO SURET IES TO THE PRESIDENT OF INDIA FOR ACCEPTANCE OF TERMS AND COND ITION OF THE PAYMENTS OF GRANT-IN-AID BEFORE RELEASE OF PAYMENT. III) THE GRANTEE SHALL MAINTAIN SUBSIDIARY ACCOUNT OF THE GRANT-IN-AID RECEIVED FROM THE GOVT. IV) THE OWNERSHIP OF BUILDING, IF ANY, CONSTRUCTED WITH THE GRANTS-IN- AID SHALL VEST WITH THE GRANTEE INSTITUTION, WHO SH ALL BE RESPONSIBLE ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 11 FOR MAINTENANCE OF SUCH BUILDING. THE ASSETS ACQUIR ED WHOLLY OR SUBSTANTIALLY OUT OF GOVT. GRANT EXCEPT THOSE DE CLARED AS OBSOLETE AND UNSERVICEABLE OR CONDEMNED AS-THE-PROCEDURE LAI D DOWN IN THE GENERAL FINANCIAL RULES SHALL NOT BE DISPOSED OF WI THOUT THE PRIOR APPROVAL OF THE SANCTIONING AUTHORITY. V) THE GRANTEE SHALL SUBMIT PERFORMANCE-CUM-ACHIEVE MENT REPORTS BEFORE APPLYING FOR THE NEXT INSTALLMENT AS GRANT. VI) THE AMOUNT SO PAID TO THE GRANTEE SHALL BE OPEN TO INSPECTION BY THE SANCTIONING AUTHORITY/INTERNAL AUDIT PARTY OF T HE PRINCIPAL ACCOUNTS OFFICE, MINISTRY OF TEXTILES, WHEREVER THE GRANTEE IS CALLED UPON TO DO SO. VII) THE ACCOUNTS SHALL BE AUDITED BY THE INTERNAL AUDITORS OF THE GRANTEE AND FINALLY BY THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION-14 OF THE COMPTROLLER AND AUDIT 'GENERAL OF INDIA (DUTIES, POWERS AND CONDITIONS OF SERVICES) A CT, 1971. VIII) THE GRANTEE SHALL NOT DIVERT THE GRANTS AND TO ENTRUST THE EXECUTION OF THE SCHEME OR WORK TO ANOTHER INSTITUTION/ASSOCIATION AND SHALL ABIDE BY THE TERM S AND CONDITIONS OF THE GRANT. IF THE GRANTEE FAILS TO UTILIZE THE G RANT FOR THE PURPOSE FOR WHICH THE SAME HAS BEEN SANCTIONED, THE GRANTEE WILL HE REQUIRED TO REFUND THE AMOUNT OF THE GRANT WITH INT EREST THEREON AS APPLICABLE FRONT TIME TO TIME. IX) THE GRANTEE SHALL SUBMIT THE UTILIZATION CERTIF ICATE, IN THE FORMAT PRESCRIBED UNDER THE GENERAL FINANCIAL RULES BY 31.03.2008 AT THE TIME OF SUBMITTING CLAIM FOR NEXT INSTALLM ENT WHICHEVER IS EARLIER. ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 12 X) THE GRANTEE AGREES TO MAKE RESERVATIONS FOR SCHE DULED CASTES AND SCHEDULED TRIBES IN POSTS/SERVICES UNDER ITS CONTROL ON THE LINES INDICATED BY THE GOVT. OF INDIA. XI) THERE IS NO REASON TO BELIEVE THAT THE GRANTEE IS INVOLVED IN CORRUPT PRACTICES. XII) THE PATTERN OF ASSISTANCE OF RULES GOVERNING S UCH GRANTS-IN-AID HAS RECEIVED THE APPROVAL OF MINISTRY OF FINANCE. XIII) IT IS CERTIFIED THAT THE UNSPENT BALANCE OF T HE PREVIOUS GRANT HAS BEEN TAKEN INTO ACCOUNT WHILE SANCTIONING THE PRESE NT GRANT. 2. NO UTILIZATION CERTIFICATE IS PENDING WITH THE G RANTEE UNDER THE SCHEME FOR INTEGRATED TEXTILE PARKS OR ANY OTHER SC HEME OF THE MINISTRY OF TEXTILES AS PER THE LIST OF GRANTEE CIR CULATED BY THE PRINCIPAL ACCOUNTS OFFICE, MINISTRY OF COMMERCE & T EXTILES VIDE OM NO. G20715/PAO/UCS/2006-7/BBA DATED 12.10.2006. 3. THE EXPENDITURE IS DEBITABLE TO MAJOR HEAD 2852 SUB-MAJOR HEAD 08-MINOR DEAD 202-27 INTEGRATED TEXTILE PARKS- GRANT-IN-AID 270031 UNDER DEMAND NO. 92 MINISTRY OF TEXTILES FOR THE YEAR 2008- 2009 (PLAN). 4. THE SANCTION IS ISSUED WITH THE CONCURRENCE OF I NTEGRATED FINANCE WING OF THE MINISTRY OF TEXTILES VIDE THEIR DY. NO. 7230 DATED 11.06.2007. 14. THEREAFTER, IN SUPPORT OF UTILIZATION OF THE GR ANT SO RECEIVED FOR THE PURPOSES IT WAS GRANTED, THE ASSESSEE HAS SUBMITTED THE UTILIZATION CERTIFICATE DATED 22.07.2008 WHICH READS AS UNDER:- ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 13 THIS IS TO CERTIFY THAT KISHANGARH HI TECH TEXTILE PART LIMITED HAS INCURRED AND EXPENDITURE OF RS. 5.36 CRORES UPTO 22 /07/2008 TOWARDS THE COMPLETION OF FOLLOWING ACTIVITIES IN CONNECTION WI TH ITS PROJECT TO SET UP AND INTEGRATED TEXTILE PARK AT VILLAGE SILORA, TEHSIL M ADANGANJ- KISHANGARH, DISTT. AJMER, AS PER DETAILS GIVEN BELOW: S.NO. ITEMS EXPENDITURE INCURRED (RS. IN CORES) 1. LAND 1.36 2. COMMON INFRASTRUCTURE 2.55 3. COMMON FACILITIES - 4. FACTORY BUILDING 0.64 5. TECHNICAL FEES 0.81 TOTAL 5.36 15. THEREAFTER, THE SECOND INSTALLMENT OF GRANT OF RS. 8 CRORES WAS SANCTIONED VIDE MINISTRYS LETTER DATED 19 TH MARCH, 2009 WITH THE SAME TERMS AND CONDITIONS AND THE ASSESSEE HAS THEREAFTE R SUBMITTED THE UTILIZATION CERTIFICATE DATED 18.02.2010 WHICH READ S AS UNDER:- THIS IS TO CERTIFY THAT KISHANGARH HI TECH TEXTILE PART LIMITED HAS INCURRED AND EXPENDITURE OF RS. 21.31 CRORES UPTO 18/02/2010 TOWARDS THE COMPLETION OF FOLLOWING ACTIVITIES IN CONNECTION WI TH ITS PROJECT TO SET UP AND INTEGRATED TEXTILE PARK AT VILLAGE SILORA, TEHSIL M ADANGANJ- KISHANGARH, DISTT. AJMER, AS PER DETAILS GIVEN BELOW:- S.NO. ITEMS EXPENDITURE INCURRED (RS. IN CORES) 1. LAND 1.36 2. COMMON INFRASTRUCTURE 10.48 ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 14 3. COMMON FACILITIES 2.15 4. FACTORY BUILDING 5.67 5. TECHNICAL FEES 1.65 TOTAL 21.31 16. THEREAFTER, ON 8 TH JUNE, 2010, SANCTION WAS GRANTED FOR ANOTHER INSTALLMENT OF GRANT OF RS. 12 CRORES FOLLOWING THE SAME TERMS AND CONDITIONS AND THE ASSESSEE HAS SUBMITTED THAT THE UTILIZATION CERTIFICATE DATED 9.11.2010 AS UNDER:- THIS IS TO CERTIFY THAT KISHANGARH HI TECH TEXTILE PART LIMITED HAS INCURRED AND EXPENDITURE OF RS. 64.08 CRORES UPTO 09/11/2010 TOWARDS THE COMPLETION OF FOLLOWING ACTIVITIES IN CONNECTION WI TH ITS PROJECT TO SET UP AND INTEGRATED TEXTILE PARK AT VILLAGE SILORA, TEHSIL M ADANGANJ- KISHANGARH, DISTT. AJMER, AS PER DETAILS GIVEN BELOW S.NO. ITEMS EXPENDITURE INCURRED (RS. IN CORES) 1. LAND 1.36 2. COMMON INFRASTRUCTURE 44.72 3. COMMON FACILITIES 4.65 4. FACTORY BUILDING 11.33 5. TECHNICAL FEES/ CONSULTANCY FEES 2.02 TOTAL 64.08 17. THEREAFTER, VIDE LETTER DATED 7 TH JUNE, 2011, THE ASSESSEE HAS BEEN GRANTED SANCTION OF ANOTHER INSTALLMENT OF RS. 12 C RORES WITH THE SAME TERMS AND CONDITIONS AND THE ASSESSEE VIDE LETTER D ATED 10 TH NOV, 2014 HAS SUBMITTED THE UTILIZATION CERTIFICATE AS UNDER:- ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 15 THIS IS TO CERTIFY THAT KISHANGARH HI TECH TEXTILE PART LIMITED HAS INCURRED AND EXPENDITURE OF RS. 889.53 CRORES UPTO 31 ST OCTOBER, 2014 TOWARDS THE COMPLETION OF FOLLOWING ACTIVITIES IN C ONNECTION WITH ITS PROJECT TO SET UP AND INTEGRATED TEXTILE PARK AT VILLAGE SI LORA, TEHSIL MADANGANJ- KISHANGARH, DISTT. AJMER, AS PER DETAILS GIVEN BELO W S.NO. ITEMS EXPENDITURE INCURRED (RS. IN LAC) 1. LAND 136.08 2. COMMON INFRASTRUCTURE 1955.35 3. COMMON FACILITIES 5996.17 4. FACTORY BUILDING 557.54 5. TECHNICAL FEES 245.39 TOTAL 8890.53 18. ON CAREFUL READING OF THE AFORESAID GRANT SANCT ION AND RELEASE LETTERS ISSUED BY THE MINISTRY OF TEXTILES, GOVERNMENT OF I NDIA, WE FIND THAT THE GRANT OF RS. 36 CRORES HAS BEEN GIVEN BY THE MINIST RY OF TEXTILES AGAINST THE APPROVED COMPONENTS OF THE TEXTILE PARK VIZ. LAND D EVELOPMENT COST, COMMON INFRASTRUCTURE, BUILDING FOR COMMON FACILITI ES, FACTORY BUILDING AND TECHNICAL FEES. FURTHER, THE ASSESSEE COMPANY HAS B EEN DIRECTED TO SUBMIT THE UTILIZATION CERTIFICATE IN THE PRESCRIBED FORMA T SO THAT THE GRANT SO GIVEN CAN BE MONITORED BY THE MINISTRY OF TEXTILES AS TO WHETHER THE SAME HAS BEEN UTILIZED FOR THE PURPOSES IT HAS BEEN GIVEN AN D THE SUBSEQUENT INSTALLMENT OF THE GRANT IS RELEASED ONLY ON SUBMIS SION OF GRANT UTILIZATION CERTIFICATE OF THE EARLIER GRANT. THE SCHEME THUS PROVIDES AS TO HOW THE GRANT SHOULD BE UTILISED AND FOR WHICH ASSETS AND T HE SAME IS CLOSELY MONITORED. IT WAS THUS NOT OPEN TO THE ASSESSEE TO UTILIZE THE GRANT FOR ANY PURPOSE AS PER ITS OWN DISCRETION. THEREFORE, THE GRANT HAS A DIRECT NEXUS ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 16 TO MEET A PORTION OF THE ACTUAL COST OF THE SPECIFI ED ASSETS. THE ASSESSEE COMPANY HAS ALSO SUBMITTED THE UTILIZATION CERTIFIC ATES FROM TIME TO TIME AND ON PERUSAL OF SAID CERTIFICATES, WE FIND THAT T HE ASSESSEE HAS STATED CLEARLY AGAINST INDIVIDUAL ASSETS SUCH AS LAND, COM MON INFRASTRUCTURE, COMMON FACILITIES, FACTORY BUILDING AND TECHNICAL F EES, THE AMOUNT OF THE EXPENDITURE INCURRED AGAINST THE GRANT SO RECEIVED. THEREFORE, THERE IS CLEARLY A DIRECT LINKAGE BETWEEN THE GRANT SO GIVEN FOR SPECIFIC ASSETS AND UTILIZATION OF SUCH GRANT TOWARDS THE INDIVIDUAL AS SET CLASSES OF THE ASSETS SO CAPITALIZED BY THE ASSESSEE. THESE ARE THE FACTS W HICH ARE CLEARLY EMERGING FROM THE MATERIAL AVAILABLE ON RECORD AND IN SUCH A FACTUAL SITUATION, WHERE THE GRANT SO GIVEN IS DIRECTED TOWARDS THE APPROVED ASSET CLASSES AND THE GRANT SO RECEIVED HAS THEREAFTER ACTUALLY BEEN UTIL SED TOWARDS SUCH ASSET CLASSES, THE ACTUAL COST OF THE ASSETS HAS BEEN DIR ECTLY MET BY THE MINISTRY OF TEXTILES, GOVERNMENT OF INDIA AND THE SAME IS RE QUIRED TO BE REDUCED FROM THE ACTUAL COST OF THE ASSETS TO THE ASSESSEE AS PER THE PROVISIONS OF SECTION 43(1) READ WITH EXPLANATION 10 THERETO. 19. NOW COMING TO THE DECISIONS OF COORDINATE BENCH ES IN CASE OF LOTUS INTEGRATED TAXPARK VS. DCIT (SUPRA), SASISRI EXTRAC TIONS VS. ACIT (SUPRA), INVENTAA CHEMICAL LTD VS CIT (SUPRA) AND SOHAN ELEC TROPLAST PVT. LTD. (SUPRA), WHICH HAVE BEEN RELIED UPON BY THE LD AR, WE HAVE CAREFULLY GONE THROUGH THESE DECISIONS AND FIND THAT THE SAME ARE DISTINGUISHABLE ON FACTS. IN THOSE CASES, WE FIND THAT THE COORDINATE BENCHES HAVE BASICALLY LOOKED AT THE OBJECT AND INTENT BEHIND THE SCHEMES WHEREIN THE GRANT HAS BEEN GIVEN TO THE COMPANIES AND HAVE HELD THAT THE SAME CANNOT BE REDUCED FROM THE ACTUAL COST OF THE ASSET. HOWEVER, IN THE INSTANT CASE, AS WE HAVE NOTED ABOVE, THE GRANT HAS BEEN GIVEN BY THE MINIST RY OF TEXTILES AGAINST THE APPROVED COMPONENTS OF THE TEXTILE PARK VIZ. LA ND DEVELOPMENT COST, COMMON INFRASTRUCTURE, BUILDING FOR COMMON FACILITI ES, FACTORY BUILDING AND ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 17 TECHNICAL FEES AND THERE IS THUS A DIRECT LINKAGE B ETWEEN THE PURPOSE FOR WHICH GRANT HAS BEEN GIVEN WHICH IS TOWARDS THE SPECIFIC ASSETS AND THE UTLISATION OF SUCH GRANT TOWARDS ACQUISITION OF THE ASSETS AS SUPPORTED BY THE UTILIZATION CERTIFICATES. THE NATURE AND CHARAC TER OF THE GRANT IN THE INSTANT CASE IS CLEARLY TOWARDS MEETING THE COST OF SPECIFIED ASSETS. THEREFORE, THESE DECISIONS DONT SUPPORT THE CASE O F THE ASSESSEE. 20. WE THEREFORE DONOT FIND ANY INFIRMITY IN THE AC TION OF THE ASSESSING OFFICER IN REDUCING THE GRANT SO RECEIVED BY THE AS SESSEE WHILE DETERMINING THE ACTUAL COST IN THE HANDS OF THE ASSESSEE BY INV OKING PROVISIONS OF SECTION 43(1) READ WITH EXPLANATION 10 THERETO AND THE CONTENTIONS SO ADVANCED BY THE LD AR CANNOT BE ACCEPTED. 21. NOW COMING TO ISSUE REGARDING THE RATE OF DEPR ECIATION, WE FIND THAT ASSETS HAVE BEEN CLASSIFIED UNDER VARIOUS SUB-HEADS SUCH AS MACHINERY WIND MILL POWER PROJECT LIKE POWER EVACUATIONS, CIV IL TRANSMISSION, LEASE OF LAND AND ERECTION AND INSTALLATION WORK & COMMISSIO NING AND CLASSIFIED UNDER THE HEAD WIND MILL POWER PROJECT IN THE FINA NCIAL STATEMENTS AS WELL AS IN THE RETURN OF INCOME. ALL THE INDIVIDUAL ASSE TS FORM PART AND PARCEL OF THE WIND MILL POWER PROJECT AND THE ONE ASSET CANNO T EXIST AND OPERATE WITHOUT THE OTHER AND THUS FORM INTEGRAL PART OF TH E WIND MILL POWER PROJECT. THEREFORE, THE ASSESSEE SHALL BE ELIGIBLE FOR DEPRECIATION @ 80% ON ALL THESE ASSETS AND SINCE THE ASSETS HAVE BEEN PUT TO USE FOR LESS THAN 180 DAYS, IT SHALL BE ELIGIBLE FOR HALF THE NORMAL RATE OF DEPRECIATION ON ALL ASSETS EXCEPT ON LEASE OF LAND WHERE THERE IS NO QUESTION OF ALLOWANCE OF ANY DEPRECIATION. THE SAME IS THE POSITION WHICH HAS B EEN CONSISTENTLY ADOPTED BY THE CO-ORDINATE BENCHES AND ALSO APPROVED BY THE HONBLE RAJASTHAN HIGH COURT IN CASE OF PR. CIT VS. M/S GANGAUR EXPOR TS PVT LTD. (SUPRA) WHEREIN IT WAS HELD AS UNDER: ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 18 3. HEARD LEARNED COUNSEL FOR THE PARTIES. 4. COUNSEL FOR THE RESPONDENT CONTENDED THAT ISSUE IS SQUARELY COVERED BY THE DECISION OF THIS COURT IN TAX APPEAL NO. 53/2012 (CIT VS. K.K.ENTERPRISES), DECIDED ON 18 THE JULY, 2014 WHEREIN THIS COURT OBSERVED AS UNDER:- THE ISSUE INVOLVED IN THESE APPEALS HAS BEEN CONSI DERED BY THE HONBLE GUJARAT HIGH COURT IN TAX APPEAL NO. 604/20 12, DECIDED ON 29.01.2013, IN COMMISSIONER OF INCOME TAX, AHMEDABA D-III VS. PARRY ENGINEERING AND ELECTRONICS PVT. LTD. IN THE CASE AFORESAID HONBLE GUJARAT HIGH COURT HELD THAT WINDMILL WOUL D REQUIRE A SCIENTIFICALLY DESIGNED MACHINERY IN ORDER TO HARNE SS THE WIND ENERGY TO THE MAXIMUM POTENTIAL. SUCH DEVICE HAS TO BE FIT TED AND MOUNTED ON A CIVIL CONSTRUCTION, EQUIPPED WITH ELECTRIC FIT TINGS IN ORDER TO TRANSMIT THE ELECTRICITY SO GENERATED. SUCH CIVIL S TRUCTURE AND ELECTRIC FITTINGS, THEREFORE, IT CAN BE WELL IGAMINED, WOULD BE HIGHLY SPECIALIZED. THUS, SUCH CIVIL CONSTRUCTION AND ELEC TRIC FITTING WOULD HAVE NO USE OTHER THAN FOR THE PURPOSE OF FUNCTIONI NG OF THE WINDMILL. ON THE OTHER HAND, IT CAN BE EASILY IMAGI NED THAT WINDMILL CANNOT FUNCTION WITHOUT APPROPRIATE INSTALLATION AN D ELECTRIFICATION. IN OTHER WORDS, THE INSTALLATION OF WINDMILL AND THE C IVIL STRUCTURE AND THE ELECTRIC FITTINGS ARE SO CLOSELY INTERCONNECTED AND LINKED AS TO FORM THE COMMON PLANT. AS ALREADY NOTED, THE LEGISL ATURE HAS PROVIDED FOR HIGHER RATE OF DEPRECIATION 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 ASSESSEE CLAIM FOR HIG HER DEPRECIATION ON SUCH INVESTMENT WAS, THEREFORE, RIGHTLY ALLOWED. ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 19 5. IN VIEW OF THE ABOVE, THE ISSUE IS REQUIRED TO BE DECIDED IN FAVOUR OF THE ASSESSEE AGAINST THE DEPARTMENT. 22. THEREFORE, RESPECTFULLY FOLLOWING THE SAME, THE ASSESSEE SHALL BE ELIGIBLE FOR DEPRECIATION ON THE WIND MILL PROJECT @ 80% EXCEPT LEASE OF LAND AND SINCE THE ASSETS HAVE BEEN PUT TO USE FOR LAND THAN 180 DAYS, THE ASSESSING OFFICER IS DIRECTED TO ALLOW DEPRECIATION @ 40% ON THE COST OF THE ASSETS (NET OF THE SUBSIDY AMOUNT). THE MATTER TO T HIS EXTENT IS DECIDED IN FAVOUR OF THE ASSESSEE COMPANY. 23. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. 24. IN ITA NOS. 326, 327 & 328/JP/2018 PERTAINING T O A.Y 2012-13, 2013-14 & 2014-15, BOTH THE PARTIES FAIRLY SUBMITTE D THAT THE FACTS AND CIRCUMSTANCES OF THE CASE ARE EXACTLY IDENTICAL TO THE FACTS AND CIRCUMSTANCES OF THE CASE IN ITA NO. 325/JP/2018, T HEREFORE, OUR FINDINGS AND DIRECTIONS CONTAINED THEREIN SHALL APPLY MUTATIS MUTANDIS TO THESE APPEALS. IN THE RESULT, ALL THESE APPEALS ARE PART LY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11/12/2019. SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11/12/2019. *GANESH/ SANTOSH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1 VIHYKFKHZ@ THE APPELLANT- M/S KISHANGARH HI TECH TEXTILE PARK LTD., KISHANGARH 2. IZR;FKHZ@ THE RESPONDENT- ACIT, (TECH), AJMER ACIT, CIRCLE-1, AJMER ITA NO. 325 TO 328/JP/2018 M/S KISHANGARH HI TECH TEXTILE PARK LTD. 20 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { ITA NO. 325 TO 328/JP/2018} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR