Tribunal overturns disallowances, provides TDS credit rectification direction.

The tribunal allowed the appeal, overturning the disallowances of additional depreciation and under section 14 A. The direction for rectifying the TDS credit issue was also provided.

---

---

Issues:
1. Disallowance of additional depreciation claimed on Wind Mill
2. Disallowance under section 14 A
3. Short credit of TDS

Analysis:

1. Disallowance of Additional Depreciation:
The appeal challenged the disallowance of additional depreciation claimed on a windmill project. The assessee argued that the windmill installation qualified for additional depreciation under section 32(1)(iia) as it was engaged in power generation. The Revenue contended that the benefit was only for businesses directly involved in power generation. The tribunal noted that the assessee was not restricted from claiming depreciation due to other business activities. Relying on precedents, the tribunal allowed the depreciation, emphasizing that operational connectivity to existing operations was not a requirement.

2. Disallowance under Section 14 A:
The appeal contested the disallowance under section 14 A. The assessee cited a previous Tribunal decision in their favor for a similar issue in a prior assessment year. The tribunal reviewed the facts and upheld the assessee's argument, limiting the disallowance to a nominal amount based on the accounts and claims presented. The disallowance for the current year was deleted, considering the exempt income sources and voluntary disallowance offered by the assessee.

3. Short Credit of TDS:
The third ground addressed the short credit of TDS. The assessee had filed for rectification of the TDS credit with the Assessing Officer under section 154. The tribunal directed the AO to verify the TDS evidence and make necessary corrections as per law. The ground was allowed for statistical purposes.

In conclusion, the tribunal allowed the appeal, overturning the disallowances of additional depreciation and under section 14 A. The direction for rectifying the TDS credit issue was also provided. The decision was announced on 14th September 2016 by the tribunal.

---