9911796707
TMI Blog2012 (9) TMI 786X X X X Extracts X X X X X X X X Extracts X X X X ..... on 143(2) of the Act was issued to the assessee on 16.12.2004. The Assessing Officer vide letter dated 13.7.2006 requested the assessee to produce certain documents to support its claim for deductions/expenditure. The assessee was asked to produce names and addresses of persons from whom purchases were made and to whom production expenses were paid. The A.R. of the assessee furnished the details as asked for by the Assessing Officer. The Assessing Officer vide assessment order dated 19.12.2006 made additions/disallowances in the income returned by the assessee on various counts. Aggrieved against the assessment order, the assessee preferred an appeal before CIT(A). The CIT(A) vide order dated 23.5.2008 partly allowed the appeal of the assessee. Aggrieved against the order of the CIT(A) both the assessee and the Revenue have come in appeal assailing the order of the CIT(A). The assessee has assailed the order of the CIT(A) by raising 10 grounds in the appeal. 3. Shri R. Kumar, Advocate appearing on behalf of the assessee did not press ground no. 1 & 2. Assailing ground no.3, the counsel submitted that the CIT(A) has erred in sustaining the disallowance of sales tax of Rs. 69,371/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that windmill was commissioned on 30.03.2004. The Additional Chief Engineer, Tamil Nadu Electricity Distribution Circle, Tirunelveli vide letter dated 15.09.2006 had given the details of electricity generated by the assessee's windmill for the period from 31.03.2004 to March, 2005. The assessee produced 1460 units of electricity from 30.03.2004 to 6.4.2004 and received Rs.3,492/- as sales proceed from TNEB. He further submitted that TNEB had issued commissioning certificate on 30.03.2004 and on the same date agreement with TNEB was entered for the sale of power. Initially, windmill was connected to Perungudi substation. Thereafter, it was connected to Chithambarapuram sub-station. The windmill was ready for power generation, it did not produce any electricity from April, 2004 to September, 2004 for the reason that Tamil Nadu Electricity Board was not able to connect the windmill to the grid. The assessee was not at fault for not generating the electricity. Windmill unit was ready to use, therefore, the assessee was entitled for depreciation on the windmill. In order to support his contentions, the counsel relied on the orders of the Tribunal in the case of Orchid Chemicals & Phar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disallowing any portion of export earnings pro rata by invoking the provisions of section 80HHC(3)(b) of the Act. This view has been upheld by the Hon'ble Madras High Court in the case of M.Gani and Co., (supra). In the said judgement, the Hon'ble Division Bench has relied on the ratio laid down by the High Court in the cases of Macmillan India Ltd(supra), Rathore Brothers (supra) and Suresh B.Mehta (supra). Thus, the assessee is entitled to deduction under section 80HHC on the income of export division only. The ground no.6 to 8 of the appeal is allowed. ITA No.1652/Mds/2008: 10. As per the provisions of Income Tax Act, the assessee is entitled for depreciation, if the following conditions are satisfied:- i) The asset must be owned by the assessee; ii) It must be used for the purpose of business or profession; iii) It should be used during the relevant previous year. In the instant case, documents on record show that the asset i.e. windmill in the present case was ready to use as the same was commissioned on 30.03.2004. Electrical Inspectorate of the Government of Tamil Nadu issued Equipment Test Certificate to the assessee for second windmill on 29.3.2004. TNEB issued a ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 2.4.1995 issued by the TNEB is on record stating that the generators were commissioned on 31.3.1995. Therefore, it is beyond any dispute that it has been officially recognized by the competent authority that the commissioning of the generators was completed in the impugned assessment year itself. This is the condition which is to be satisfied to claim depreciation on the windmill. Once the said condition is satisfied, the question of actual generation of electricity, perhaps in the next previous year, does not defeat the claim of the assesse, as the assessee is entitled for depreciation on commissioning itself. Therefore, in the light of the above judgment of the Hon'ble Jurisdictional High Court, we have to hold that the Commissioner of Income-tax(Appeals) has rightly held that the assessee is entitled for depreciation. Accordingly, we uphold the order of the Commissioner of Incometax( Appeals)." 12. In another case, i.e. ITA No.1651/Mds/2008 - DCIT Vs. M/s. James Textiles decided on 30.10.2009 by the Tribunal it was held as under:- "8. We have heard the rival submissions and "considered the facts and materials on record. There is no dispute about the fact that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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