2015 (10) TMI 2741

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... to assessment year 2008-09. The assessee filed his return of income for the impugned assessment year on 30-09-2008 declaring loss of Rs. 69,32,877/-. Thereafter, the assessee filed revised return of income on 03-10-2009 declaring taxable income of Rs. 73,52,950/-. The case of the assessee was selected for scrutiny. Accordingly, notice under section 143(2) of the Act was issued to the assessee on 21-08-2009. During the course of scrutiny assessment, the Assessing Officer observed that the assessee has claimed depreciation on certain components / constituents of windmill viz. civil work, MEDA Processing Fee, MEDA Application Fee, Electrical Installation, Labour charges for installation and final testing, etc. at the rate of 80%. The Assessin....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....9,00,000   8. Other Pre-operation Expenses capitalized 5,00,000       3.1 The co-ordinate Bench of Tribunal in the case of DCIT Vs. Sushant M. Jadhav in ITA No.166/PN/2012, assessment year 2008-09 decided on 26-04-2013 in similar controversy by following the decision of Tribunal in the case of M/s. Western Precicast Pvt. Ltd. Vs. JCIT, decided on 30-01-2013 had allowed the claim of depreciation @ 80% on all the above said components, except on Keeping the area vacant for free access. The ld. AR in order to strengthen his submissions, has also placed reliance on the decision of Hon'ble Bombay High Court in the case of CIT Vs. Cooper Foundry Pvt. Ltd. in Income Tax Appeal No.1326 of 2010 decided on ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....     6. The ld. AR has drawn support from the order of co-ordinate Bench in the case of DCIT Vs. Sushant M. Jadhav (supra) to show that depreciation @ 80% is allowable on all the above components of the windmill, except expenditure on keeping the area vacant for free access. We find that in the case of DCIT Vs. Sushant M. Jadhav (supra), the coordinate Bench after placing reliance on the decision of M/s. Western Precicast Pvt. Ltd. Vs. JCIT (supra), has decided the issue in favour of the assessee. The relevant extract of the order of Tribunal in ITA No.166/PN/2012 reads as under:- "5. We have heard the parties. We find that the identical issue has been considered by the Tribunal in the case of M/s. Western Precicas....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ecessary as contained in para 2.5 of order of the CIT(A):- S.No. Date Nature of work Expenditure -Rs. 1. 30-03-2006 Towards supply and installation of HT electrical Yard with VCB, outdoor type CT & PT and HT Transmission Line from Windmill to Grid interconnection point including HT metering for 1.25 MW WINDMILL AT LOCATION No. K437 at above site address. 30,93,500/- 2. 30-03-2006 Labour charges towards final testing and commissioning for 1.25 MW windmill at Loc No. K437. 1,10,200/- 3. 30-03-2006 Towards labour charges for work executed, for erection and installation of windmill consisting of : Unloading and safe keeping of material, Assembly, erection and installation of windmill tower and wind t....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....h expenditure forms integral part of cost of the windmill and therefore, there is no mistake on the part of the CIT(A) to have considered such expenditure as eligible for depreciation at 80%." 5. We therefore following the order of the Tribunal cited supra hold that both the parties below were not justified in calculating and disallowing the depreciation on the cost of foundation, commissioning and erection of the wind mill. Accordingly, we allowed the issue in favour of the assessee and delete the addition made by the A.O. by making the disallowance towards alleged excess claim of depreciation. 6. In our opinion, the Ld.CIT(A) has rightly allowed the claim of the assessee, as issue arising from the grounds taken by the re....