DCIT, Jaipur V. M/S DANGAYACH HOTELS PVT. LTD., Jaipur

ITA 747/JPR/2011

• Counselvise Citation: 74723114 RSA 2011
• Duration Of Justice: 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-01-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 19-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VINOD JOHARI
• Assessee Lawyers: G G MUNDRA
• Keywords: Depreciation

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, B JAIPUR (BEFORE SHRI R.K.GUPTA AND SHRI N.L. KALRA) ITA NO.747/JP/2011 ASSESSMENT YEAR : 2008-2009 DEPUTY COMMISSIONER OF INCOME TAX VS. M/S. DANGAY ACH HOTELS PVT. CIRCLE-6, JAIPUR. LTD., C-59, PERITHVI RAJ RO AD JAIPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VINOD JOHARI RESPONDENT BY : SHRI G.G. MUNDRA DATE OF HEARING: 09.01.2012 DATE OF PRONOUNCEMENT: 13.01.2012 ORDER PER SHRI N.L. KALRA, A.M. 1. THE REVENUE HAS FILED AN APPEAL AGAINST ORDER OF LD CIT(A)-II, JAIPUR DATED 20/06/2011. THE GROUND OF APPEAL IS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(APPEALS) HAS ERRED IN DELETING ADDITION OF RS.3 8,60,680/- MADE BY THE AO BY WAY OF DISALLOWANCE OF EXCESS DEPRECIATION CLAIMED ON WIND TURBINE HOLDING THAT DEPRECIATION @80% HAS TO BE ALLOWED ON COMPLETE WIN G MILL WITHOUT SEGREGATING INVESTMENT ON BUILDING PART AND ON ELECTRIC ITEMS W ITHOUT APPRECIATING THE FACT THAT DEPRECIATION @80% IS ALLOWABLE ONLY ON WIND MI LL PLANT AND NOT ON OTHER ELECTRICAL FITTINGS AND BUILDING ETC. 2. A SIMILAR ISSUE WAS RAISED BY REVENUE IN THE CAS E OF THE ASSESSEE FOR THE EARLIER ASSESSMENT YEAR AND THE TRIBUNAL VIDE ORDER DATED 1 3/04/2011 IN ITA NO. 969/JP/2010 DISMISSED THE APPEAL OF REVENUE AFTER OBSERVING AS UNDER: AFTER HEARING BOTH THE PARTIES, WE NOTICED THAT THE ISSUE BEFORE US STANDS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF ASSE SSEE FOR THE EARLIER ASSESSMENT 2 YEAR. IT WILL BE USEFUL TO REPRODUCE PARA 9 OF THE TRIBUNALS ORDER IN ITA NO. 1632/JP/2008 DATED 26.02.2010. WE HAVE CONSIDERED CAREFULLY THE RECORDS BEFORE US AND ARGUMENTS ADVANCED BY BOTH THE PARTIES. WE NOTED THAT THE AO ALLOWED 80% DEPRECIATION ONLY ON THE COST OF WINDMILL PLANT I.E. RS.2.04 CRORES AND ON THE BA LANCE AMOUNT ALLOWED DEPRECIATION EITHER @ 10% OR 25% CONSIDERING THE SA ME AS BUILDING OR PLANT AND MACHINERY. THE HONBLE MADHYA PRADESH HIGH COURT IN THE CASE DCIT VS VIPPY SOLVEX PRODUCTS LTD 164 TAXMAN 483 HELD IN THE CASE OF AUTOMATIC COAL SUPPLY SYSTEM, THE COAL CONTAINER, COAL CONVEYOR AND BUCKE T ELEVATOR, DUST COLLECTING SYSTEM CAN HAVE NO INDEPENDENT SYSTEM AND IT IS FOR THE PURPOSE OF MODERNIZATION AND AUTOMATION THAT THESE ITEMS WERE PURCHASED AND ATTACHED TO THE BOILER AND SINCE THEY BECOME AN INTEGRAL AND INSEPARABLE PART OF THE BOILER WITHOUT HAVING ANY UTILITY OTHERWISE, THEY ARE ALSO ENTITLED TO DE PRECIATION @100%. IN THE PRESENT CASE THE FOUNDATION OF PLATFORM, ERECTION, INSTALLA TION OF PLANT AND MACHINERY, PREPARATION OF CRANE PLATFORM FOR WINDMILL AND OTHE R AND OTHER CIVIL WORK CARRIED OUT FOR INSTALLATION ARE INTEGRAL PART OF HE WINDMI LL WHICH HAVE NO INDEPENDENT USE. THUS THE SAME ARE ENTITLED TO CLAIM DEPRECIATI ON @80%. THEREFORE, WE FIND NO INFIRMITY IN THE ORDER OF THE LD. CIT(A) WHO HAS RIGHTLY DELETED THE ADDITION MADE BY THE A.O. THUS GROUND NO. 2 OF THE REVENUE I S DISMISSED. FOLLOWING THAT ORDER OF THE TRIBUNAL, WE HOLD THAT THE LD.CIT(A) WAS JUSTIFIED IN DISALLOWING THE ADDITION MADE BY THE AO ON ACCOUNT OF EXCESS CLAIM OF DEPRECIATION TO THE EXTENT OF RS.36,39,773/-. 3. FOLLOWING OUR ORDER IN THE CASE OF ASSESSEE WHIC H WAS FORMERLY CHIRASH ASSOCIATES P. LTD., WE HOLD THE LD CIT(A) WAS JUSTIFIED IN DIRECT ING THE A.O. TO ALLOW DEPRECIATION. IN THE RESULT THE APPEAL OF REVENUE IS DISMISSED. 4. THE ORDER IS PRONOUNCED IN OPEN COURT ON 13.01.2 012 SD/- SD/- (R.K.GUPTA) (N.L.KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 13.01.2012 *S.KUMAR* 3 COPY FORWARDED TO:- 1. DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-6, JAIP UR. 2. M/S. DANGAYACH HOTELS PVT. LTD., C-59, PERITHVI RAJ ROAD, C-SCHEME, JAIPUR. 3. THE CIT 4. THE CIT(A), 5. THE D/R, ITAT, JAIPUR 6. THE GUARD FILE IN ITA NO.747/JP/2011 BY ORDER A.R., I.T.A.T., JAIPUR