TaxTMI Login
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →Just a moment...
AI OCR ✕Convert scanned orders, printed notices, PDFs and images into clean, searchable, editable text within seconds. Starting at 2 Credits/page
Try Now →
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) Whether the Assessing Officer could disturb the opening written down value of a windmill carried forward from the earlier year and recompute depreciation on that asset; (ii) Whether the expenditure on foundation, erection, electrical items, installation and allied charges formed part of the windmill eligible for depreciation at 80%.
Issue (i): Whether the Assessing Officer could disturb the opening written down value of a windmill carried forward from the earlier year and recompute depreciation on that asset.
Analysis: The opening written down value represented the closing written down value of the preceding year, in which the asset had already been accepted in assessment. In the absence of any fresh material, the value brought forward could not be reopened in the succeeding year for reworking depreciation. The earlier year's allowance could not be unsettled while computing depreciation on the opening balance.
Conclusion: The Assessing Officer could not disturb the opening written down value, and the assessee was entitled to depreciation on that brought-forward value.
Issue (ii): Whether the expenditure on foundation, erection, electrical items, installation and allied charges formed part of the windmill eligible for depreciation at 80%.
Analysis: The consolidated cost of the windmill was not shown to be separately divisible into independent assets for different rates of depreciation. Foundation work was necessary for the functioning of the machinery, and electrical and installation items were integral to the operation of the windmill. In the absence of a reliable bifurcation in the invoice or supporting material, these expenses were treated as part of the windmill itself.
Conclusion: The entire consolidated cost, including the allied expenditure, qualified for depreciation at 80%.
Final Conclusion: The assessee succeeded on the depreciation claims for both the carried-forward windmill value and the consolidated cost of the later windmill, and the Revenue's challenge failed.
Ratio Decidendi: Where a windmill and its allied foundation, erection, electrical and installation expenses are integral to the machinery and no reliable bifurcation is established, the whole cost is eligible for the prescribed higher depreciation, and the opening written down value of an asset accepted in an earlier year cannot be reopened in a later year absent fresh material.
TaxTMI 
TaxTMI 
