TaxTMI 
TaxTMI 
2015 (3) TMI 1017
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....007-08 and 2008-09 assails the direction given by the Commissioner of Income-tax (Appeals) to allow the assessee deduction under section 80-IA on windmills, treating it as only source of income, without adjusting earlier year's losses. The ground relating to appeals for the assessment years 2002- 03, 2004-05 and 2006-07 are taken up first. 3. The facts apropos are that the Assessing Officer denied the assessee deduction claimed under section 80-IA for a reason that once inter se adjustment with losses in units, on which there was no 80-IA claim was done, there was nothing left for granting such deduction. Though the assessee relied on the decision of the hon'ble apex court in the case of CIT v. Canara Workshops P. Ltd. [1986] 161 1TR 320 (SC), the Assessing Officer was not impressed. According to the Assessing Officer, the assessee had incurred loss in aluminium alloy ingot plant and such loss had to be adjusted against profits of pyrotechnic aluminium powder unit and once the adjustment was carried out, the result was still a loss and hence deduction under section 80-IA could not be allowed. 4. In its appeal before the Commissioner of Income-tax (Appeals), argument o....
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....l the impugned assessment years, and therefore, by necessary implication its gross total income, before deductions claimed under Chapter VI-A, whatever be that amount, would have only been positive. So, the only question that remains is, when the gross total income is positive, a deduction under sections 80-IA and 80-IB can be worked out independently without setting off losses of units on which such deduction was not being claimed. In our opinion, this question stands already answered by the hon'ble jurisdictional High Court in their decision in the case of Chamundi Textiles (Silk Mills) Ltd. v. CIT [2012] 341 ITR 488 (Mad). There the question was regarding claim of deduction under section 80HHC and whether such deduction could be allowed without considering the results of a unit, which was not having any profits. It was held by their Lordships that by virtue of the decision of the hon'ble apex court in the case of IPCA Laboratory Ltd. v. Deputy CIT [2004] 266 ITR 521 (SC), undisputedly only an assessee having positive profits could claim such a deduction. Their Lordships also held that for arriving at such profit, income from various units had to be calculated and if one ....
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..... M. Gani and Co. [2008] 301 ITR 381 (Mad), each of the unit had to be separately considered for working out deduction under section 80-IA or 80-IB or 80HHC of the Act, once separate accounts were being maintained and there was no interlacing and interdependence. In the given case before us, the assessee had positive gross total income. Therefore, each undertaking had to be considered separately for working out deduction under section 80-IA of the Act, since the gross total income was positive. We are of the opinion that the Commissioner of Income-tax (Appeals) was justified in giving such directions. 8. The ground raised by the Revenue for the assessment years 2007-08 and 2008-09 is with regard to the Commissioner of Income-tax (Appeals) allowing deduction under section 80-IA for windmills, without adjusting notional losses of years prior to the initial year of such claim. The assessee was captively consuming the electricity generated by its own power plant. The assessee was engaged in manufacturing and sale of metal powders. The Assessing Officer held that the assessee could not claim deduction under section 80-IA of the Act on electricity supplied by its windmills for captive....
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....Assessing Officer had simply made an addition relying on section 14A without giving any finding that the assessee had incurred any expenditure in relation to dividend income on which the assessee had claimed exemption. 17. The learned Departmental representative fairly admitted that the matter should go back to the file of the Assessing Officer for proper verification of the issue. 18. We have perused the orders and heard the submissions. The Assessing Officer had disallowed 6 per cent. of the expenditure incurred by the assessee under the head printing and stationery, postage and telegram, professional and other services and payment to auditors, considering it to be expenses incurred by the assessee for earning dividend income. The Assessing Officer had made such disallowance since the assessee was holding shares which resulted in substantial dividend income. On appeal by the assessee, the learned Commissioner of Income-tax (Appeals) confirmed such disallowance relying on the decision of the Special Bench of this Tribunal in the case of ITO v. Daga Capital Management P. Ltd. [2009] 312 ITR (AT) 1 (Mum) [SB] taking a view that rule 8D applied retrospectively. Now we find that....
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....authorised representative submitted that the powers of the appellate authority was wide enough to consider a fresh claim even where the assessee had not filed a revised return. 22. The learned Departmental representative strongly supported the order of the Commissioner of Income-tax (Appeals). 23. We have perused the orders and heard the rival submissions. There is no dispute that the assessee had not made any claim for additional depreciation on windmills under section 32(1)(iia) in its original return. The assessee had not even filed a revised return but had staked such claim during the course of assessment proceedings. The Assessing Officer, relying on the decision of the hon'ble apex court in the case of Goetze (India) Ltd. v. CIT [2006] 284 ITR 323 (SC), denied the claim of the assessee and the Commissioner of Income-tax (Appeals) affirmed the view of the Assessing Officer. Before us also, nothing was brought on record by the learned authorised representative as to why the fresh claim should be considered. The hon'ble jurisdictional High Court in the case of CIT v. Shriram Investments (TC(A) No. 344 of 2005 dated June 16, 2012) held that section 139(5) of the Act....
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....als) that the assessment year 2005-06 was the initial assessment year for claiming deduction under section 80-IA in respect of its Wind Farm Vestas. However, the Commissioner of Income-tax (Appeals) did not accept such a claim since according to him, in audit report in Form 10CCB, filed along with the return for the assessment year 2004-05, the assessee had mentioned the initial assessment year as 2003-04. As per the Commissioner of Income-tax (Appeals), once the claim was based on the return of income, it could not be changed or modified during the assessment proceedings. 27. Now before us, the learned authorised representative, assailing the order of the Commissioner of Income-tax (Appeals), submitted that an error made in the assessment year 2004-05 could not be a reason for changing the initial assessment year. According to him, there was no claim whatsoever under section 80-IA for Wind Farm Vestas for the assessment year 2003-04. 28. Per contra, the learned Departmental representative supported the order of the Commissioner of Income-tax (Appeals). 29. We have perused the orders and heard the rival submissions. It is not disputed that the assessee had filed the audit ....