TaxTMI 
TaxTMI 
TaxTMI 
2016 (8) TMI 1156
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....ion 115JB of the Act), by disallowing the assessee's claim of additional depreciation on windmill and expenses claimed, by way of contribution of PF and ESI contributions. Thus, the assessing officer, vide order, dated 29.12.2008, passed an order, under Section 143(3) of the Income-Tax Act, 1961. 3. Being aggrieved by the same, the respondent/assessee filed an appeal in I.T.A.No.920/2013-14, before the Commissioner of Income-Tax (Appeals)-II, Chennai. On the disallowance of additional depreciation of the wind mill, before the appellate authority, the assessee has contended that they are engaged in the business of manufacturing of iron and steel products and during the financial year 2005-06, relevant to the assessment year 2006-07, they installed a windmill and the energy generated from the said windmill was used for captive use. Thus, they are eligible for the additional depreciation on the windmill, at the rate of 20%, amounting to Rs. 1,12,74,024/-, under Section 32(1)(iia) of the Income-Tax Act, 1961. 4. Before the appellate authority, placing reliance on a decision of this Court in CIT v. VTM Ltd., reported in 319 ITR 336 (Mad.), contention has been made that once the as....
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....appellate authority, vide order, dated 21.07.2014, by observing that the dispute in the appeal relates to payments of Employees' Contribution towards PF & ESI, which are governed by the provisions of Section 36(1)(va) of the Income Tax Act and not subjected to the provision of Section 43B of the Act and on the facts and circumstances of the case, disallowed the Employees' Contribution towards PF of Rs. 25,208/- and ESI of Rs. 6,800/-, respectively. 9. Not satisfied with the order of the Commissioner of Income-Tax (Appeals), in I.T.A.No.920/2013-14, dated 21.07.2014, the revenue has preferred an appeal in I.T.A.No.2955/Mds/2014, before the Income Tax Appellate Tribunal, D Bench, Chennai. Revenue has reiterated the same contentions, as made before the appellate authority. Defence to sustain the order of the appellate authority was that the electricity generated by the windmill was used for captive construction and reliance was mde to the decision in CIT v. VTM Ltd., reported in 319 ITR 336 (Mad.). After considering the rival submissions, at Paragraph 4, the Tribunal, by its order, dated 01.01.2016, in I.T.A.No.2955/Mds/2014, has ordered as follows: "4. We have considered t....
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....on power generation will apply in relation to assessment year 2013-14 onwards as per amended provisions of Section 32(1)(iia) w.e.f. 01.04.2013?" 11. Though in respect of the above substantial questions of law, for which, an answer is sought for, under Section 260-A of the Income Tax Act, Mr.T.R.Senthil Kumar, learned standing counsel for the Income-Tax Department, submitted that the Tribunal has failed to consider that the benefit of additional depreciation, conferred under Section 32(1)(iia), was not provided to the plant and machinery used in power sector, until the Finance Act, 2012, which came into effect, with an intention of granting the benefit of additional depreciation to the assessee, engaged in the business of generation of power, this Court is not inclined to accept the said contention, in view of the judgment of this Court in CIT v. VTM Ltd., reported in 319 ITR 336 (Mad.), wherein, this Court held that, "It is true that the assessee is a company engaged in the business of manufacture of textile goods. As far as application of Section 32(1)(iia) of the Act, is concerned, what is required to be satisfied in order to claim the additional depreciation is that the sett....
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.... (iia) in the case of any new machinery or plant (other than ships and aircraft), which has been acquired and installed after the 31st day of March, 2002, by an assessee engaged in the business of manufacture or production of any article or thing, a further sum equal to fifteen per cent of the actual cost of such machinery or plant shall be allowed as deduction under clause (ii): Provided that such further deduction of fifteen per cent shall be allowed to:- (A) a new industrial undertaking during any previous year in which such undertaking begins to manufacture or produce any article or thing on or after the 1st day of April 2002; or (B) any industrial undertaking existing before the 1st day of April 2002, during any previous year in which it achieves the substantial expansion by way of increase in installed capacity by not less than ten per cent." 5. In the case on hand, the assessee is stated to have set up two wind mills in addition to the already existing four wind mills and thereby increased its power generation capacity by above 50%. It is true that the assessee is a company engaged in the business of manufacture of oil seeds, moulded rubber parts, reed value assemb....