AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (1) TMI 609
X X X X Extracts X X X X
X X X X Extracts X X X X
....unal in MA No.62/PN/2014, dated 13.06.2014. The appeal of the Revenue in ITA No.890/PN/2011 was also adjudicated by the Tribunal vide order dated 31.12.2012. However, the assessee moved Miscellaneous Application before the Tribunal pressing that the appeal of the assessee and the appeal of Revenue are to be heard together, since the issue involved in both the appeals was same. The Tribunal noted the fact that the appeal of the assessee has been recalled and the appeal of the Revenue arising from the same order of CIT(A) was also recalled by the Tribunal vide order dated 22.07.2015 vide MA No.93/PN/2014 and consequently, cross appeals were fixed for hearing before us. 3. The assessee in ITA No s. 1495/PN2011 and 2484/PN/2012 is also aggrieved on similar issue of non-grant of depreciation on windmill as raised in assessment year 2007-08. Hence, all the appeals relating to the same assessee were heard together and are being disposed of by this consolidated order for the sake of convenience. Reference is being to the facts and issue in ITA No.814/PN/2011 to adjudicate the issues. 4. First, we shall take up cross appeals filed by the assessee and the Revenue vide ITA Nos.814/PN/ 2011 a....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... location No.GP-31, Installation (with material) of electrical line for power transmission and metering in respect of wind farm project consisting of one WTG for your 0.60 MW wind mill or specifically designed devices which run on wind mills and as such at location No.G P-31, as integral part of wind mill when these items are not wind mill or specifically designed devices which run on mill wind mills and as such said items would not classify for depreciation @ 80% as per the depreciation schedule. 2. On the facts and in the circum stances of the case and in law, the CIT[A] erred observing that labour work related to installation of one wind turbine generator for Rs. 10,55,056/- was required to be included in the cost of wind turbine generator for allowance of depreciation @ 80% when the said expenses was required to be spread over in the proportion of cost of civil work, cost of wind mill and cost of plant & Machinery and the depreciation was to be allowed as applicable rates. 3. On the facts and in the circumstances of the case and in law, the CIT[A] erred in applying the decision of the ITAT, Pune Bench in the case of Poonawala Finvest and Agro Pvt. Ltd. (118 TTJ 68) as the....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... foundation / work for transformer and plinth and cost of erection and commissioning of the windmill. As per the assessee, the windmill consisted of generator, the fins, the electrical cables, and other mechanical parts, stand on which the generator is to be installed, and necessary civil work for holding the stand. All these were part and parcel of the windmill and it could not come into existence without these things and therefore, these parts were indispensable for its existence and there is no merit in the division of cost into various heads as proposed by the Assessing Officer. It was further pointed out that the supplier in assessment year 2007-08 had charged consolidated price of Rs. 90 lakhs without giving any break-up and thereafter, no division of cost on any assumption should be made. The Assessing Officer rejecting the submissions of assessee noted that from the details filed relating to assessment year 2006-07, the expenditure could be bifurcated into the cost of Wind Turbine and expenditure on foundation and civil work and also erection and commissioning work. In view of separate bills received by the assessee in the preceding year, the Assessing Officer bifurcated th....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... assessee drew our attention to the copy of bill placed at page 29 of the Paper Book and pointed out that the same was a consolidated bill issued by the supplier. He further argued that the Assessing Officer had bifurcated the figures by comparing the same with the bill of bigger windmill installed in the preceding year, where separate bills were given by the supplier. The learned Authorized Representative for the assessee stressed that there was no merit in the said bifurcation on cost of windmill. 10. The learned Departmental Representative for the Revenue pointed out that in case there was an error in the earlier years, the same could not be allowed to continue in the succeeding year. It was further pointed out that the fact could be considered as held by the Hon'ble Madras High Court in Ace Investments (P.) Ltd. Vs. CIT (2000) 244 ITR 166 (Mad). The learned Departmental Representative for the Revenue further pointed out that the Department was aggrieved by the order of CIT(A) in allowing 80% depreciation on electrical items, on which depreciation was to be allowed only to the extent of 15%. 11. We have heard the rival contentions and perused the record. The first issue arisin....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e second part of the issue before us is in relation to the windmill installed by the assessee in the year under appeal. The assessee had purchased a windmill for consolidated price of Rs. 90 lakhs from M/s. Southern Wind Farm Ltd. vide Invoice dated 28.02.2007. The copy of the Invoice is available on record. The Invoice does not bifurcate between cost of windmill and the allied expenses to be incurred for the erection and installation of the windmill and other construction thereof. In the absence of these requisite details being available on record, we find no merit in the order of Assessing Officer in bifurcating the cost of windmill into different heads of expenses, against which the Assessing Officer held that the assessee was entitled to the claim of depreciation at different rates. As per the Assessing Officer, cost of Wind Turbine entitles the assessee to the depreciation @ 80%. However, the cost of electrical installation would attract depreciation @ 15% and the cost of civil construction would attract depreciation @ 10%. The foundation work was an integral part of the machinery, since the machinery cannot function without foundation. In other words, even in cases where the ....