TaxTMI 
TaxTMI 
TaxTMI 
2013 (1) TMI 733
X X X X Extracts X X X X
X X X X Extracts X X X X
....63 of the Act, raised the following grounds : 1. The impugned order of the Commissioner of Income-tax is wrong, illegal and opposed to facts. The order of assessment is neither erroneous nor prejudicial to the interests of the Revenue and as such the Commissioner has no jurisdiction to interfere under section 263 of the Income-tax Act. 2. The Commissioner of Income-tax ought to have also seen that the Assessing Officer enquired into the commencement of production of the windmill and all the documents in support of the fact had been looked into by the Assessing Offic....
X X X X Extracts X X X X
X X X X Extracts X X X X
....1, 2007 declaring income at Rs. 89,17,976 from business and Rs. 4,21,155 from agriculture. The assessment was completed on December 8, 2009 under section 143(3) of the Act determining income from business at Rs. 90,43,770. Subsequently, notice under section 263 of the Act was issued by the Commissioner of Income-tax stating that the windmill erected by the assessee commenced generation of power on or after October 15, 2006 and not on September 29, 2006 and, therefore, the Assessing Officer allowed depreciation to the extent of 80 per cent. on the windmill without restricting the same to 40 per cent. while completing the assessment under section 143(3) of the Act. Thus, the Commissioner of Income-tax opined that the assessment made under sec....
X X X X Extracts X X X X
X X X X Extracts X X X X
....October 3, 2006 having satisfied with the erection of windmill and generation of power, disbursed the loan amount directly to manufacturer of windmill, i.e., M/s. Vestas RRB India Ltd. All these facts have been examined by the Assessing Officer. Therefore, the assessee pleaded that the assessment made by the Assessing Officer under section 143(3) allowing depreciation at 80 per cent. is neither erroneous nor prejudicial to the interests of the Revenue. However, the Commissioner of Income-tax passed order under section 263 of the Act on March 22, 2012 setting aside the assessment order and directed to allow depreciation on windmill at 40 per cent. Against this order of the Commissioner of Income-tax, the assessee is in appeal before us. 5. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....'ble Supreme Court in the case of Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83 (SC). 7. Counsel for the assessee further submits that the Commissioner of Income-tax went wrong in setting aside the assessment and directed the Assessing Officer to allow depreciation only at 40 per cent. He submits that the Commissioner of Income-tax was of the view that since the bank has sanctioned loan on October 3, 2006 and disbursed the loan amount after that date, the windmill could have only been commenced generation of power on or after October 15, 2006 and, therefore, the assessee's excess claim of depreciation was wrong. This is only an assumption. The Commissioner of Income-tax also observed that the assessee imported power of 657 u....
X X X X Extracts X X X X
X X X X Extracts X X X X
....used the material available on record and the orders of the lower authorities. Counsel for the assessee submitted a paper book containing pages 1 to 34. Pages 1 to 26 contain various letters, agreements, sanctions etc., as mentioned in paragraph 5 above. The assessee submits that all these documents were filed before the Assessing Officer. The Department could not controvert the submissions that these documents were not placed before the Assessing Officer. 10. We find that while completing the assessment under section 143(3) of the Act, the Assessing Officer has not discussed about the issue of depreciation of windmill, may be for the reason that he was satisfied that the assessee is eligible for depreciation and, therefore, since he has n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e as held by the hon'ble Supreme Court in the case of Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83 (SC). The Department has not questioned the certificate issued by the TNEB that the windmill has commenced generation of power on September 29, 2006 as certified by them. 11. The hon'ble Madras High Court in the case of CIT v. Metal Powder Co. Ltd. [2012] 75 DTR 233 (Mad) considered a situation where the assessee claimed depreciation on windmill which were put to use on March 31, 1994 based on the certificate issued by State Electricity Board that the windmill has commenced generation of power during the year. The hon'ble Madras High Court held in para 8 of its order as under : &n....