TaxTMI 
TaxTMI 
2016 (1) TMI 663
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....liable to be set aside. 2. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in holding that the assessee is entitled for claim of depreciation amounting to Rs. 24,38,680/- without appreciating the fact that the assessee do not have the ownership right on the assets on which depreciation has been claimed. 3. The first ground is in general and not pressed by the Ld. AR, hence dismissed. 4. The assessee had applied for the sanction of electric load of 3,200 KVA for running its induction furnace. The electric connection of the desired load had to be applied well in advance, since large number of formalities is involved in the sanction and installation of the power connection. On an application made ....
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.... the assessee. 5. The Assessing Officer in his order observed that during the year under consideration the assessee claimed deprecation at 15% as per the provisions of Section 32(1) as well as additional depreciation at 20% as per the provisions of Section 32(1) (iia) on the electric installations of Rs. 69,61,944/-. As per the fixed asset schedule, the electric installations of Rs. 48,44,910/- were purchased prior to 1/4/2005 and installation of Rs. 21,17,034/- was purchased during the year. The deprecation u/s 32 (1)(iia) is allowed only if the plant and machinery must be acquired and installed after 31/3/2005. Thus it is clear that the expenditure incurred prior to 31/5/2005 will not qualify for the additional depreciation u/s 32(1)(2....
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....(A) held in para 4 as under: "I have carefully considered the submissions made by the counsel as also the order passed by the A.O and the observations made by him. I have gone through the documents filed by the appellant at the time of assessment as well as certain additional documents before the in support of his contention. The veracity of these documents are not in dispute as stated by the A.O in his remand report where the A.O adds that these documents were not possessed by the assessee during the assessment. However, in order to impart substantive justice all these documents are admitted. It is noted that the appellant had made security deposit and part of the advance amount with the Uttar Pradesh Power Corporation Li....
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.... turn hazardous in self-handling. It is also noted that the appellant has not claimed depreciation on the security deposit which is separately reflected on the asset side of the balance sheet. I am thus of the view that appellant is the sole beneficial owner of the power distribution machinery and that he draws power from the said system in his own right as an owner. On this issue reliance is also placed on decisions of Hon'ble Supreme Court & Hon'ble High Court in cases of Jodhamal Kuthalia 82 ITR 570, Poddar Cement P. Ltd 226 ITR 625; Mysore Minerals Ltd. 239 ITR 775; Fazilka Dabwali Transport Co. 270 ITR 398 and several other decisions of Hon'ble High Court viz. CIT vs. Gaekwad & Co. 277 ITR 553; CIT vs. Sarabhai Chemicals P.....
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....t and Machinery up to 31/3/2005 was Nil, there has been addition under this head for Rs. 98,57,986/- during the year. The details of their addition has also been provided which are in the nature of Power and Control system, furnaces and power supply unit, transformer and loose accessories, crane structure and others. Now these plant and machinery would be of no use, if electrical installation/connection is not done. Rather the business operation itself cannot operation-lize. Therefore, expenditure made by the appellant on electrical installations can in the alternative be capitalized with Plant and Machinery and normal depreciation and additional deprecation can be allowed on both the items taken together. The decisions in CIT Vs. Tata Mill....
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....tar Pradesh Power Corporation Limited, and clearly stated that the assessee has not taken any depreciation on the security deposit but only has claimed deprecation on system loading charges, bay charges and proceeding charges. Though, the security deposit was paid on 8/11/2004, the assessee has not claimed any depreciation in the earlier year. Therefore, the assessee has rightly claimed the depreciation in the year under consideration. 11. We have perused all the records and heard both the counsels. It is pertinent to note that the assessee company has submitted all the details related to the electrical installation and its co-relation with the business activities of the assessee. The said installation was within the premises of the asse....