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TMI Blog2016 (12) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... to one of its members from the proceeds which has been received from the sale of property were liable to be given allowance under section 36 (1)(iii) of the Income Tax Act. The matter is thus concluded on facts.- Decided in favour of assessee Allowance of expenses on earth filing and other miscellaneous expenses - Held that:- The tribunal categorically records the finding of fact that the assessee genuinely incurred expenses on earth filling and other miscellaneous expenses for the purpose of business on the property that they had purchased from the Agra Development Authority. This question too is therefore concluded by facts and answered in favour of the assessee - Decided in favour of assessee - Income Tax Appeal No. 53 of 2013 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... guisher, earthling material, transformers, electrical line etc. during the year under consideration. The assessee also made investment in transportation and installation of these equipments in addition to the core component of the windmills like turbine generation comprising mainly Nacelle, Hub and set of three blades, controller (Microprocessor) and claimed 80% depreciation on all the above activities undertaken by it in relation to the installation of windmill amounting to ₹ 9,92,61,681/- on ₹ 12,40,77,101/-. The A.O. found that microprocessor, hub nacelle were the main power of a windmill and were installed at tubular tower of 74.5 meter which was specifically designed for the windmills; therefore depreciation at the ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the windmill and specially designed devices and the assessee was entitled for higher depreciation on all the above items ignoring the facts that these components are installed at the end of the generator and as such do not help in power generation by windmill? 2. Whether the Hon'ble ITAT was legally correct in holding that the assessee has sufficient funds available interest free to cover up the loans and advances and advances have been given to these family concerns out of the sale of land ignoring the facts that the money received from the sale proceeds of land does not make the funds surplus till the liability in the form of term loan and unsecured loans, sundry creditors etc. are there? 3. Whether the Hon'ble ITAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e part and parcel of the windmill and cannot be separated from each other and therefore depreciation on such investment is liable to be given to the assessee and was rightly allowed at the higher rate. The Rajasthan High Court has also taken the same view in respect of windmill in the case of Commissioner of Income Tax, Udaipur versus K.K. Enterprises, reported in (2014) 51 Taxmann.com 190 (Rajasthan) wherein also the assessee's claim was allowed. We respectfully follow the above two decisions and held that the ITAT was correct in holding that all the components used for the structure of a windmill were entitled for higher depreciation and is a part of a integrated machinery. The first question is therefore answered in favour of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the logic extended by the assessee is incorrect in view of the fact that the assessee (has taken term loan and the sale proceeds were first required to be utilized for payment of interest and principle of the term loan and not to extend money to the family members of the shareholders without any commercial expediency thereby the assessee was prejudicing in its own business interest. Further just before advancing the money the sale proceeds had credited in the bank account;does not make the funds surplus till the liability in the form of term loan and unsecured loan, sundry creditors are appearing in the assessee's balance sheet as on the date. In view of this finding as recorded by the A.O. himself, it cannot be said that any amou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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