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TMI Blog2015 (10) TMI 1759X X X X Extracts X X X X X X X X Extracts X X X X ..... granted to weaker sections by the Government of Karnataka and Since the assessee does not owned the land, assessee cannot be considered as owner of the WEG - Held that:- A perusal of the record shows that the said land has been taken on lease by M/s. Pioneer Windcon Pvt. Ltd., for a period of 30 years. We also find that The Karnataka Renewable Energy Development Ltd., has approved the power project and there is an agreement between the Department of Energy of Government of Karnataka and the assessee for the installation and supply of electricity to the Government. These facts conclusively established the claim of the assessee for depreciation merely because the assessee is not the owner of the land and the land is a leasehold land would not itself disentitled the assessee with the claim of depreciation. The Ld. CIT(A) has rightly allowed the claim of depreciation and therefore we decline to interfere. - Decided in favour of assessee. Addition u/s. 69C - unexplained expenditure - Held that:- except for the admission of one of the Authorised Representative, there is no documentary evidence to suggest that the assessee has incurred cost outside the books of account. Merely on the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame order of the Ld. CIT(A)-24 Mumbai dated 28.2.2013 pertaining to A.Y. 2007-08. ITA No. 4158/M/2013 and C.O. No. 165/M/2014 are appeal and cross objection by the Revenue and the assessee against the very same order of the Ld. CIT(A)-24 Mumbai dated 28.2.2013 pertaining to A.Y. 2008-09 and ITA No. 4636/M/2013 is the appeal by the Revenue against the order of the Ld. CIT(A)-23, Mumbai dated 1.3.2013 pertaining to A.Y. 2009-10. As common issues are involved in all these appeals and cross objections, they were heard together and disposed of by this common order for the sake of convenience and brevity. 2. The grievance of the Revenue is same in all the assessment years under appeal though the quantum may defer. The Revenue is aggrieved by the decision of the Ld. CIT(A) in allowing depreciation on Wind Mills -WEG. 3. At the very outset, representatives of both the sides agreed that facts involved in the issues under consideration are identical for all the years therefore we heard the appeal of assessment year 2007-08 and on the basis of the facts of A.Y. 2007-08, these appeals are disposed of as under. 4. Facts of the case are that the assessee is a trader in spices and Oil seeds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee Shri Anil Sharma in his letter dated 23.12.2009 had admitted that the said land was procured by Southern Wind Farms Ltd., and Pioneer Windcon Pvt. Ltd., and the assessee has paid ₹ 3 lakhs towards the cost of land. The AO was of the firm belief that the assessee has incurred unexplained expenditure in the purchase of land at ₹ 2,41,500/-. The AO added the same to the income of the assessee. The AO then proceeded by examining the cost of WEG and after elaborate discussion in his assessment order, the AO finally came to the conclusion that the assessee has failed to give a detailed break-up in respect of the individual machineries and therefore the assessee was asked to provide the purchase bills of machineries used in the erection of the new WEG. Since the purchase bills were not produced by the assessee, the AO form the belief that no depreciation is allowable on WEG. The AO was also of the opinion that there is no real and verifiable evidence produced by the assessee to show new assets have come into existence in the name of the assessee. The AO denied depreciation in respect of WEG at Tamil Nadu for want of documentary evidences. 4.5. In so far as the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... KW WEG is to be connected with boards grid through the existing 22kv Gudimangalam feeder fed of 110/22KV Udumalpet Sub-Station permanently. 4.3.8 The DDIT, Unit-Il, Coimbatore has also enclosed the installation certificate dt. 02/02/2007 wherein the HTSC number, capacity, location, village and date of supply "effected are mentioned. Thus, as per the above evidence produced by the assessee and the, DDIT, Unit- II, Coimbatore the WEG is a new one and erected by the assessee during the financial year 2006-07 relevant to A.Y. 2007-05. 4.3.9 From the above findings, in my opinion, the assessee has satisfied all the conditions for claiming depreciation. In order to claim depreciation the assessee has to satisfy the conditions of ownership existence of machinery put to use and particularly in this case it should be a new machine. The provisions of sec. 32(1) read as under :- "32(1) In respect of depreciation of- (i) buildings/ machinery; plant or furniture/ 'being tangible: assets; (ii) (ii) know-bow. patents/ copyright, trade marks/ licences/ franchises or any other business or commercial rights of similar nature/ being intangible assets acquired on or after the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld that the assessee's claim for purchasing a Wind Mill, erecting the same and generating electricity are fully substantiated. Therefore, the assessee is entitled to the claim of depreciation as per the provisions of the law. We, accordingly decline to interfere with the findings of the Ld. CIT(A). 9.2. In so far as the claim of depreciation on the Wind Mill installed in the State of Karnataka is concerned, the AO has declined the claim for the following reasons: i) The land on which the Wind Mill has been erected cannot be owned by the assessee as it belongs to/or the land granted to weaker sections by the Government of Karnataka. ii) Since the assessee does not owned the land, assessee cannot be considered as owner of the WEG. 9.3. A perusal of the record shows that the said land has been taken on lease by M/s. Pioneer Windcon Pvt. Ltd., for a period of 30 years. We also find that The Karnataka Renewable Energy Development Ltd., has approved the power project and there is an agreement between the Department of Energy of Government of Karnataka and the assessee for the installation and supply of electricity to the Government. These facts conclusively established the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .3.2005 which prescribed for 20% of the capital cost of such plant and machinery. As the additional plant and machinery has been installed after 30.9.2006 but before 31.3.2007, the same is to be restricted to 10% of the total cost of the plant and machinery. 17.2. The claim of additional depreciation has been denied because the provisions of Sec. 32(1)(iia) has been amended w.e.f. 1l.4.2013 by the Finance Act, 2012. 17.3. Before us, the Ld. Counsel for the assessee straightaway relied upon the decision of the Hon'ble High Court of Madras in the case of CIT Vs Atlas Export Enterprise (Mad) 373 ITR 414. It is the say of the Ld. Counsel that this decision of the High Court of Madras clearly show that the generation of electricity by windmill amounts to production of an article or thing and therefore the pre-amended provision is applicable. 18. We have given a thoughtful consideration to the facts of the case qua the decision of the Hon'ble High Court of Madras. With our utmost respect to the Hon'ble High Court of Madras, if the view expressed by the Hon'ble High Court is correct, then there was no need for inserting specifically " or in the business of generation or generation a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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