2014 (10) TMI 792 - HC - Income Tax

Claim of depreciation @ 80% on installation of windmill Satisfaction of requirement of second proviso to Rule 5(1A) of the Income Tax Rules or not Held that - Following the decision in CIT V. Vijaya Hirasa Kalamkar (HUF) 1992 (9) TMI 4 - BOMBAY High Court - if the assessee exercised the option in terms of second proviso to Rule 5(1A) of the Income Tax Rules at the time of furnishing of return of income, it will suffice and no separate letter or request or intimation with regard to of exercise of option is required - Since the returns are filed in accordance with Section 139(1) of the Income Tax Act and the form prescribed therein make a provision for exercising an option in respect of the claim of depreciation, no separate procedure is required Decided against revenue.

Summary

Issues involved:
Claim of depreciation on windmills contrary to Rule 5(1A) Appendix 1A of the Income Tax Rules.

In this Tax Case (Appeal), the main issue was the claim of depreciation by the assessee on the installation of windmills, which the Revenue contended was against Rule 5(1A) Appendix 1A of the Income Tax Rules. The Revenue argued that the issue was already settled by a previous decision of the Court in T.C.(A) Nos.330 of 2013. The Court referred to a decision of the Bombay High Court and held that if the assessee had exercised the option in accordance with the second proviso to Rule 5(1A) at the time of filing the return of income, no separate intimation was required. The Court agreed with the Tribunal's reasoning and ruled in favor of the assessee based on the Bombay High Court's decision. Consequently, the substantial questions of law raised by the Revenue were answered in favor of the assessee, leading to the dismissal of the Tax Case (Appeal) with no costs incurred.

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