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2017 (6) TMI 770 - AT - Income TaxAddition on account of difference/mismatch of the figures in the accounts of the assessee and the payee of the amount paid by the assessee to Architect Mr. Ajay Wade - Held that - We have gone through the copy of the confirmations filed but we note that the same were not enough and sufficient evidence to prove the actual payment of the said amount by the assessee to Mr. Ajay Wade. However, considering the interest of justice, we restore this issue to the file of the AO to decide it afresh. The AO will verify the accounts of the assessee as well as of Mr. Ajay Wade and thereafter to decide the issue afresh in accordance with law. Ground Nos.3 & 4 are therefore treated as allowed for statistical purposes. Additional depreciation on wind mill - Held that - NTPC Ltd. vs. DCIT 2012 (5) TMI 127 - ITAT DELHI wherein held that the process of generation of electricity is akin to manufacture or production of article or thing and that an assessee engaged in the activity of generation of electricity would be entitled to additional depreciation under section 32(1). Disallowance made by the AO under section 80IB(10) - Held that - A perusal of the above part of the impugned order reveals that the Ld. CIT(A) has allowed the claim of the assessee following the decision of the Tribunal in the own case of the assessee for A.Y. 2004-05, 2005-06 & 2006- 07. Since the issue is squarely covered by the decision of the Tribunal in the own case of the assessee and no differentiating fact has been brought into our knowledge for the year under consideration. Disallowance of bogus purchases - Held that - CIT vs. Nikunj Enterprises (P.) Ltd. (2013 (1) TMI 88 - BOMBAY HIGH COURT) wherein held the findings of the tribunal that where the assessee filed letters of confirmation of suppliers, copies of bank statement showing entries of payment through account payee cheques to suppliers and stock reconciliation statements, sale of purchased goods was not doubted, the transactions were supported with evidences and confirmations, in such an event merely because the suppliers have not appeared before the AO or the Ld. CIT(A), one can not conclude that the purchases were not genuine.
Issues Involved:
1. Assessment of income on a protective basis. 2. Disallowance of outstanding payment to an architect. 3. Allowability of additional depreciation on windmill. 4. Disallowance of deduction under section 80IB(10). 5. Disallowance of alleged bogus purchases. Issue-wise Detailed Analysis: 1. Assessment of Income on a Protective Basis: Ground Nos. 1 & 2: The assessee contested the assessment of income from the Peace Heaven project on a protective basis for the Assessment Year (AY) 2010-11, arguing that the income had already been assessed for AY 2009-10. The Tribunal noted that the protective assessment was based on an order dated 25.04.2013, which was subsequently quashed by the Tribunal on 18.05.2015. Consequently, these grounds became infructuous and were dismissed. 2. Disallowance of Outstanding Payment to an Architect: Ground Nos. 3 & 4: The assessee challenged the disallowance of ?6,27,167/- payable to architect Mr. Ajay Wade, arguing that the amount was accrued and due during the year but paid subsequently. The disallowance was due to a mismatch in the accounting systems of the assessee (mercantile) and the payee (cash). The Tribunal restored the issue to the Assessing Officer (AO) for fresh verification of accounts and decision in accordance with the law, allowing the grounds for statistical purposes. 3. Allowability of Additional Depreciation on Windmill: Ground No. (i): The Revenue contested the additional depreciation of ?1,74,97,618/- on a windmill, arguing that the eligibility started only from 01.04.2013. The Tribunal referred to the Delhi High Court's decision in "NTPC Ltd. vs. DCIT," which held that the generation of electricity qualifies as manufacturing, thus entitling the assessee to additional depreciation under section 32(1). The Tribunal dismissed this ground. 4. Disallowance of Deduction under Section 80IB(10): Ground Nos. (ii) to (vi): The Revenue challenged the deduction under section 80IB(10) on multiple grounds, including non-compliance with eligibility requirements, joint venture issues, and construction of commercial units. The Tribunal noted that the CIT(A) had allowed the deduction based on the Tribunal's earlier decisions in the assessee's favor for AYs 2004-05, 2005-06, and 2006-07. No new differentiating facts were presented for the current year. Therefore, these grounds were dismissed. 5. Disallowance of Alleged Bogus Purchases: Ground Nos. (vii) to (xi): The Revenue argued that purchases amounting to ?95,203/- from Mahavir Traders were bogus, as the trader was listed as a Hawala dealer by the Sales Tax Department. The CIT(A) had deleted the addition, noting that the AO did not conduct independent inquiries and that the transactions were supported by banking records, invoices, and confirmations. The Tribunal upheld the CIT(A)'s decision, citing legal precedents that supported the genuineness of the transactions in the absence of contrary evidence. Conclusion: The Tribunal dismissed the Revenue's appeal and partly allowed the assessee's appeal for statistical purposes. The final order was pronounced on 03.04.2017.
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