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TMI Blog2012 (10) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... serve the assessee’s special technical requirement, it would qualify to be treated as a plant – in favour of Assessee. Disallowance of Expenses - The Assessing Officer disallowed 2% of such expenses claimed on the vouchers directly without supported by any bill. The assessee claimed weaving, tailoring, samples and packing charges to the tune of Rs. 3.36 crores in its profit and loss account. The Assessing Officer disallowed 2% of such expenditure amounting to Rs. 6,72,089/-. The ld. CIT(A) confirmed the addition. It was submitted that for the Assessment Year 2005-06 on identical facts the Assessing Officer disallowed 1% for such expenses on estimate basis on a turnover of Rs. 4.04 crores. Held that:- Having regard to the nature of busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ges, weaving and packaging charges etc. The CIT(A) further confirmed the order of the Assessing Officer with regard to disallowance of mending and checking charges by applying the provisions of section 40(a)(ia) of the Act. Aggrieved against the order of the CIT(A), the assessee has come in second appeal before the Tribunal. 3. The counsel for the assessee submitted that the case of the assessee is squarely covered by the order of the coordinate Bench of the Tribunal in the assessee s own case passed in ITA No.2291/Mds/2008 dated 29th November, 2009 relevant to the assessment year 2005-06. He submitted that grounds of appeal no.2 to 6 relating to depreciation on windmill as well as grounds no.11 to 13 with regard to claim of depreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2291/Mds/2008 relevant to the assessment year 2005-06. Grounds no.2 to 6 and 11 to 13 in the present appeal relates to depreciation. In para no.12 of the order in ITA No.2291/Mds/2008, the Tribunal has held as under:- 12. We have heard the rival contentions and perused the order. There can be no dispute that a wind mill is an apparatus that harnesses wind power, for a variety of uses like pumping water, driving of saw mill, grinding cone and/or driving electrical turbines. A typical wind mill, as installed by the assessee, which is of Suzlon Corporation, would consist of a specialized foundation, on which the wind blades are attached through a post. The Blades connected in the top is a revolving apparatus to which different numbers of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere it was held that whether a the building can be treated as a plant was a question of fact and when it is found as a fact that the building has been so planned and constructed as to serve the assessee s special technical requirement, it would qualify to be treated as a plant. In our opinion, the expenses relating to the land and foundation specially incurred with a view to serve the technical requirements would also become a part of the plant in a case that of a wind mill. If we look at Appendix I to the Income-tax Rules, prescribing the rates of depreciation, it can be seen that Legislature has given higher depreciation rate of 80% on anti-pollution devices, energy saving and renewable energy devices. Apparently, these higher rate have b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid order is reproduced herein below:- 5. In para 10 of its order dated 21.04.2009, in ITA Nos. 1818 to 1821/Mds/2008, it was held as under: We have heard the rival submissions. The assessee is engaged in manufacture and export of cotton fabrics in Karur. The process of manufacturing of cotton fabrics involves procuring and processing of yarn and giving them to weavers. During the relevant Assessment Year the assessee debited certain expenses like weaving charges, tailoring, winding, dyeing, processing, packing charges, coolie, sample and manufacturing expenses in the profit and loss account. These expenses were vouched. However, some defects were pointed out in the vouchers. The Assessing Officer disallowed 2% of such expenses claim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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