2021 (3) TMI 972

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....Bench ('the Tribunal' for brevity) for assessment year 2012-13. 2. The Revenue has raised the following substantial questions of law for consideration: "1. Whether on the facts and circumstances of the case and in law, the Hon'ble ITAT is correct in law in allowing additional depreciation on windmill of Rs. 3,45,52,281/- u/s 32(1)(ii)(a) of the Income Tax Act? 2. Whether on the facts and circumstances of the case, the ITAT is correct in law in allowing the additional depreciation under Section 32(1)(ii)(a) of the Income Tax Act whereas the amended provision under Section 32(1)(ii)(a) permits for additional depreciation of actual cost of any new machinery or plant (other than ships and aircraft) acquired and ....

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.... on, the electrical energy generation by the wind mills owned by the assessee are taken to the Tamilnadu Electricity Board and the energy is credited to the power consumption of the factory manufacturing Pet Bottles. Therefore, it is submitted that generation of electricity by the wind mills is inextricably connected to the business of the assessee. The assessee enclosed the month wise wind energy generated by the wind mills and the details of units taken for captive consumption. The assessee placed reliance on the decision in the case of CIT Vs. Hi Tech Arai Ltd. (321 ITR 477). 7. The CIT(A) accepted the contention advanced by the assessee and held that the finding of the Assessing Officer that the wind energy is not the primary busines....

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....e same into the grid of the Tamilnadu Electricity Board and pursuant to the agreement between the assessee and the Board, a grid is given to the generator. Therefore, going with scheme of things, it is undoubtedly clear that the assessee is into the generation of power, which is being fed into the grid of the Tamilnadu Electricity Board to be distributed. 11. Identical issues was considered by this Court in the case of Commissioner of Income Tax, Madurai Vs. VTM Ltd. [(2009) 319 ITR 336]. The operative portion of the judgment reads as follows: "5. In the case on hand, the assessee is stated to have set up a wind mill at a cost of Rs. 5,85,60,000/-. It is true that the assessee is a company engaged in the business of manufacture ....