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TMI Blog2012 (10) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... ts and allow depreciation thereon at different rates of depreciation. The foundation, civil and electrical works are necessary for the installation of the windmill and is clearly part and parcel of the windmill project. Therefore depreciation at the rate of 80% is allowable. Issue decides in favour of assessee Disallowance of expenditure u/s 14A r.w.Rule 8D – Assessee contended that introduction of Rule 8D is w.e.f. AY 2008-09 and is not applicable for the year under consideration i.e. AY 2007-08 - No internet bearing funds have been used for earning exempt income - Held that:- Issue need to be remand to the AO to decide issue with reference to the decision in case of Walfort Share & Stock Brokers P. Ltd. (2010 (7) TMI 15 - SUPREME COURT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the purchase of land also. This part needs verification by the AO. The learned counsel for the assessee has opposed the submissions of the learned DR. He submitted that as per the provisions of the Act, depreciation at the rate of 80% is allowable on the entire device which is capable of generating electricity using the wind energy. He submitted that the civil and electrical works are necessary for the installment of the windmill and therefore the depreciation and additional depreciation on the same was rightly allowed by the learned CIT(A). 4. We have considered rival submissions and perused the orders of the AO and the CIT(A). The depreciation is allowable on renewable energy device which also includes windmill. The depreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... troduction of Rule 8D is w.e.f. AY 2008-09 and is not applicable for the year under consideration i.e. AY 2007-08 and that no internet bearing funds have been used for earning exempt income. In view of elaborate submissions filed and the legal position laid down by various courts of law including the Hon ble Apex Court in the case of CIT Vs. Walfort Share Stock Brokers P. Ltd. 326 ITR 1 (SC), the provisions of section 14A are not attracted in case of the appellant in absence of any proximate cause for disallowance. Accordingly, the ld. CIT(A) ought to have deleted the impugned addition of ₹ 90,115/- 6. We have heard both the parties. In the facts and circumstances of the case, we restore this issue to the file of the AO with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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