2009 (10) TMI 140

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....g additional depreciation on the wind mills installed by the assessee, even though the assessee was engaged in the business of production of agricultural motors and pump sets, and the wind mill was not purchased in the context core business, so the exemption contemplated under section 32(1)(iia) cannot be granted as per the Income-tax Act, 1961?" 2. The only issue for consideration in this case is, whether the Commissioner of Income-tax (Appeals) is justified in confirming the disallowance made by the assessing authority on additional depreciation claim on the new wind mills installed by the assessee by overlooking the conditions prescribed under section 32(1)(iia) of the Income-tax Act. 3. The facts culled out from the statement of f....

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....on of electricity and not on the increase in capacity of investment castings. The Commissioner of Income-tax (Appeals) also disallowed the claim of the assessee on the ground that the investment in the windmills is clearly one for the purpose of saving of electricity charges and their installation has in no way increased the installed capacity of the investment castings manufacturing business. The assessee carried the matter on appeal to the Tribunal. Before the Tribunal it was contended by the Departmental representative that when the assessee is doing the business of investment castings, then the installation of new windmills did not increase the capacity of the core business of the assessee and accordingly the assessee is not entitled fo....

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....nd material on record, we note that the Assessing Officer has disallowed the claim of the assessee on the ground that the assessee is basically generating the electricity by wind mills for its own consumption and it is not the business of the assessee. Therefore, the assesses is not entitled for additional depredation on wind mills, under section 32(1) (iia). On appeal the Commissioner of Income-tax (Appeals) has allowed the claim of the assessee on the ground that it is not essential that the assessee is in the business of generation of electricity. But, since the assessee is generating the electricity by windmills, the conditions of the law are fulfilled for claiming additional depreciation. It is an undisputed fact that after the additio....