ACIT 8(1), MUMBAI V. ENERCON WINDFARMS (JAISALMER) P. LTD, MUMBAI

ITA 4275/MUM/2011

• Counselvise Citation: 427519914 RSA 2011
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2004-2005
• Appeal Filed On: 25-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B JAYA KUMAR
• Assessee Lawyers: ASHISH BAIRAGRA
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E, MUMBAI BEFORE SHRI P.M.JAGTAP, ACCOUNTANT MEMBER & SHRI VIVEK VERMA, JUDICIAL MEMBER. I.T.A. NO. 4275/MUM/2011. ASSESS MENT YEAR : 2004-05. ASSTT. COMMISSIONER OF ENERCON WINDFARMS (JAISALMER) P. LTD., INCOME-TAX- 8(1), VS. ENERCON TOWER, PLOT NO. A-9, MUMBAI. VEERA INDUSTRIAL ESTATE, VEERA DESAI ROAD, ANDHERI (WEST), MUMBAI 400 053. PAN AABCE3105C APPELLANT. RESPONDENT. APPELLANT BY : SHR I B. JAYA KUMAR. RESPONDENT BY : SHRI ASHISH BAIRAGRA. DATE OF HEARING : 27-03-2012. DATE OF PRONOUNC EMENT : 30-03-2012 O R D E R PER P.M. JAGTAP, A.M. : THIS APPEAL IS PREFERRED BY THE REVENUE AGAINST TH E ORDER OF LEARNED CIT(APPEALS)-16, MUMBAI DATED 21-03-2011 WHEREBY HE CANCELLED THE PENALTY OF RS.2,79,06,110/- IMPOSED BY THE AO U/S 271(1)(C) IN RESPECT OF ADDITION MADE TO THE TOTAL INCOME OF THE ASSESSEE ON ACCOUNT OF ALLE GED EXCESS CLAIM OF DEPRECIATION MADE ON FOUNDATION/BASEMENT OF WINDMILLS. 2. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D ALSO PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT DEPRECIATIO N ON FOUNDATION/BASEMENT OF WINDMILLS WAS CLAIMED BY THE ASSESSEE AT A HIGHER R ATE OF 80% APPLICABLE TO WINDMILLS. THE AO, HOWEVER, TREATED THE SAID FOUNDA TION/BASEMENT AS DIFFERENT 2 ITA NO.4275/MUM/2011 ASSET ELIGIBLE FOR DEPRECIATION AT NORMAL RATE AND DISALLOWED THE CLAIM OF THE ASSESSEE FOR DEPRECIATION TO THE EXTENT OF RS.8,28, 04,488/-. HE ALSO IMPOSED A PENALTY U/S 27(1)(C) IN RESPECT OF THE SAID ADDITIO N WHICH WAS CANCELLED BY THE LEARNED CIT(APPEALS) BY HIS IMPUGNED ORDER ON THE G ROUND THAT THE CLAIM OF THE ASSESSEE FOR HIGHER DEPRECIATION ON FOUNDATION/BASE MENT OF LIFT HAD BEEN ALLOWED BY THE TRIBUNAL IN THE QUANTUM PROCEEDINGS. 3. AT THE TIME OF HEARING BEFORE US, THE LEARNED CO UNSEL FOR THE ASSESSEE HAS PLACED ON RECORD A COPY OF THE ORDER OF THE TRIBUNA L DATED 4 TH JUNE, 2010 PASSED IN ITA NO. 2666/MUM/2009 WHILE DISPOSING OF THE APPEAL OF THE ASSESSEE PASSED IN THE QUANTUM PROCEEDINGS. A PERUSAL OF THE SAME SHOW S THAT THE HIGHER CLAIM OF THE ASSESSEE FOR DEPRECIATION AT THE RATE OF 80% ON FOU NDATION/BASEMENT CONSTRUCTED FOR WINDMILLS HAS BEEN ALLOWED BY THE TRIBUNAL HOLD ING THAT THE SAME FORMS PART AND PARCEL OF THE WINDMILLS. IN THE CASE OF K.C. BU ILDERS AND ANOTHER REPORTED IN 135 TAXMAN 461, THE HONBLE SUPREME COURT HAS HELD THAT IF THE CORRESPONDING ADDITION ITSELF IS DELETED OR SET ASIDE IN THE QUA NTUM PROCEEDINGS, PENALTY IMPOSED U/S 271(1)(C) IN RESPECT OF THE SAID ADDITION CANNO T BE SUSTAINED. RESPECTFULLY FOLLOWING THE SAID DECISION OF THE HONBLE SUPREME COURT, WE UPHOLD THE IMPUGNED ORDER OF THE LEARNED CIT(APPEALS) CANCELLI NG THE PENALTY IMPOSED BY THE AO U/S 271(1)(C). 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED ON THIS 30 TH DAY OF MARCH, 2012. SD/- SD/- (VIVEK VERMA) ( P.M. JAGTAP) JUDICIAL MEMBER ACCO UNTANT MEMBER MUMBAI, DATED: 30 TH MARCH, 2012. 3 ITA NO.4275/MUM/2011 COPY TO : 1. APPELLANT 2. RESPONDENT 3. C.I.T. 4. CIT(A) 5. DR, E-BENCH. (TRUE COPY) BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI. WAKODE