2021 (9) TMI 113 - AT - Income Tax

Rectification of mistake - Depreciation on electric wiring - Revenue challenging the action of CIT(A) in holding the assessee is entitled to claim depreciation @ 80% on electrical wiring as the same is integral part of windmill, in contravention of depreciation allowable on electrical fittings @ 10% as per Income Tax Rules, 1962 and also in upholding the contention that power generation from windmill is manufacturing and eligible for additional depreciation u/s. 32(1)(iia) - HELD THAT - This Tribunal order in M/S. PRAGATI AROMA OIL DISTELLERS P. LTD. 2014 (8) TMI 1216 - ITAT PUNE held that the Department did not serve the notice on the assessee and therefore, this Tribunal proceeded to dismiss the grounds of appeal raised by the Revenue for not serving notice on respondent assessee, but, however, we find this Tribunal has given liberty to file an application to recall the said order to decide on merits. DR, submits that the appellant Revenue is in a position to serve notice on the assessee if this Tribunal recalls the above order. Therefore, taking into consideration the findings of this Tribunal and also that the submissions of ld. DR in the interest of justice, we deem it proper to recall the order. Miscellaneous Applications filed by the Revenue are allowed.

Summary

Issues:
1. Non-representation of the assessee leading to an ex-parte decision.
2. Discrepancy in the notice served by the Department.
3. Claim of depreciation on electrical wiring and additional depreciation for power generation from windmill.

Analysis:
1. The judgment pertains to four Miscellaneous Applications filed by the Revenue against an order passed by the Tribunal for assessment years 2007-08 to 2010-11. The absence of representation from the assessee resulted in the case being treated as ex-parte. The Tribunal proceeded to hear the arguments of the ld. DR and examined the available material.

2. The appeals were filed by the Revenue challenging the CIT(A)'s decision allowing the assessee to claim depreciation at 80% on electrical wiring, contrary to the 10% depreciation prescribed by the Income Tax Rules, 1962 for electrical fittings. Additionally, the CIT(A) upheld that power generation from windmills qualifies as manufacturing, making it eligible for additional depreciation under section 32(1)(iia) of the Act.

3. The Tribunal noted a discrepancy in the notice served by the Department to the assessee, leading to the dismissal of the Revenue's grounds of appeal. However, the Tribunal granted the Revenue the liberty to file an application to recall the order for a decision on merits. The Revenue, through the ld. DR, expressed readiness to serve notice if the order was recalled. Consequently, the Tribunal, considering the interests of justice, decided to recall the order and directed the registry to schedule the appeal for regular proceedings. As a result, the Miscellaneous Applications filed by the Revenue were allowed.

In conclusion, the judgment addresses issues related to non-representation of the assessee, discrepancies in the notice served, and the eligibility of the assessee for specific types of depreciation. The decision to recall the order demonstrates the Tribunal's commitment to ensuring fair proceedings and considering the submissions made in the interest of justice.