Revenue's Appeal Denied for Additional Depreciation on Windmill

The Revenue appealed against the order allowing additional depreciation under section 32(1)(iia) on a windmill. The Assessing Officer disallowed the depreciation claimed by the assessee, but the CIT(A) allowed it citing relevant High Court decisions. However, the Tribunal held that as the assessee was not engaged in manufacturing or production activities, they were not entitled to the additional depreciation. The Tribunal distinguished this case from previous decisions and set aside the CIT(A)'s order, restoring that of the Assessing Officer. Ultimately, the Department's appeal was allowed.

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Issues involved: Appeal against order allowing additional depreciation u/s 32(1)(iia) on windmill.

Summary:

Issue 1: Additional Depreciation Claim
- The Revenue appealed against the CIT(A)'s order allowing additional depreciation u/s 32(1)(iia) on windmill.
- The Assessing Officer disallowed the additional depreciation claimed by the assessee on the windmill.
- The CIT(A) allowed the appeal of the assessee citing relevant decisions of the High Court.
- The assessee, deriving income from various sources, filed a return declaring total income and claimed additional depreciation under section 32(1)(iia).
- The Tribunal noted that additional depreciation is allowable for new machinery or plant acquired after a specified date by an assessee engaged in manufacturing or production.
- As the assessee was not engaged in manufacturing or production activities, the Tribunal held that the assessee was not entitled to additional depreciation on the windmill.
- The Tribunal distinguished the case from previous decisions where the assessees were engaged in manufacturing or production activities.
- Consequently, the Tribunal set aside the CIT(A)'s order and restored that of the Assessing Officer, allowing the grounds of appeal of the Revenue.

Final Decision:
- The appeal of the Department was allowed.

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