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TMI Blog2016 (8) TMI 1156X X X X Extracts X X X X X X X X Extracts X X X X ..... he article or thing that was already being manufactured by the assessee. Therefore, the contention that the setting up of a wind mill has nothing to do with the power industry, namely, manufacture of oil seeds etc. is totally not germane to the specific provision contained in section 32(1)(iia) of the Act. See Commissioner of Income-Tax v. Atlas Export Enterprise(2015 (3) TMI 846 - MADRAS HIGH COURT ) (Mad.), which followed in Hi-Tech Arai's case (2009 (9) TMI 60 - MADRAS HIGH COURT) Thus upheld the order of the Tribunal, allowing additional depreciation. - Decided against revenue X X X X Extracts X X X X X X X X Extracts X X X X ..... aid provision does not state that setting up a new machinery or plant, which was acquired and installed after 31.03.2002, should have any operational connectivity to the article or thing that was already being manufactured by the assessee and therefore, setting up of a windmill has nothing to do with the manufacture of goods and that is not warranted under Section 32(1)(iia). 6. Cursory look at the reported case shows that on the question, as to whether, in order to claim additional depreciation, under Section 32(1)(iia), what is required to be satisfied is that only a new machinery or plant to be acquired and installed after 31.03.2002 by an assessee, who is already engaged in the business of manufacture or production of any article or thing and the said provision does not state that setting up of a new machinery or plant, acquired and installed after 31.03.2002, should have any operational connectivity to article or thing that was already being manufactured by the assessee, this Court, while answering the question, in favour of the assessee, allowed additional depreciation. 7. Observing that the decision in CIT v. VTM Ltd., reported in 319 ITR 336 (Mad.), is squarely applicable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, the assessee was engaged in the manufacturing of textile goods and electricity generated by the windmill was used for captive consumption in manufacturing of textile goods. In those circumstances, the Madras High Court found that the provisions of the Act does not state that setting up of new machinery or plant should have operational connectivity to the article or thing that was already being manufactured by the assessee. In those circumstances, this Tribunal is of the considered opinion that the CIT(Appeals) has rightly placed his reliance on the binding judgment of Madras High Court. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority. Accordingly, the order of the CIT(Appeals) is confirmed. 5. In the result, this appeal of the Revenue is dismissed." 10. Being aggrieved by the concurrent orders of the appellate authority and that of the Tribunal, revenue has preferred the instant Tax Case Appeal, on the following substantial questions of law, "(1) Whether on the facts and circumstances of the case, the Appellate Tribunal was right in holding that the assessee is entitled to additional depreciation on the purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R 477 (Mad.), revenue sought for an answer, on the following substantial questions of law, "(1) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in holding that the assessee is entitled to additional depreciation on the purchase of Wind Mills even though the main business of the assessee is not producing or generating of electricity? (2) Whether on the facts and circumstances of the case, the Tribunal was right in allowing additional depreciation under Section 32(1)(iia) on wind mill amounting to ₹ 33,29,562/- and ₹ 37,28,824/- respectively for assessment years 2003-2004 and 2004-2005 was proper? 3. Whether the Tribunal was right in not considering the judgment of a Co-ordinate Chennai Bench passed in ITA 2107/Mds/06 dated 25.06.2008 in the case of Texmo Industries which is binding on it and in favour of the revenue as it against the ratio of the judgment of the Constitution Bench of the Supreme Court reported in AIR 1989 SC 1933? 4. Whether the new machinery or plant purchased is eligible for additional depreciation or only those plant and machinery purchased and used in its main business the exemption c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chinery or plant, which was acquired and installed upto 31.03.2002 should have any operational connectivity to the article or thing that was already being manufactured by the assessee. Therefore, the contention that the setting up of a wind mill has nothing to do with the power industry, namely, manufacture of oil seeds etc. is totally not germane to the specific provision contained in Section 32(1)(iia) of the Act." 13. Following the decision in Hi-Tech Arai's case (cited supra), in Commissioner of Income-Tax v. Texmo Precision Castings reported in (2010) 321 ITR 481 (Mad.), a Hon'ble Division Bench of this Court, upheld the order of the Tribunal, allowing additional depreciation. 14. In M.M.Forgings Ltd., v. Additional Commissioner of Income-Tax reported in (2012) 349 ITR 673 (Mad.), one of the substantial questions of the law, raised was whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that the assessee is not entitled to additional depreciation u/s.32(1)(iia) of the Income-Tax Act, 1961, on the assets acquired after 30.09.2004? Reversing the order of the Tribunal, at Paragraphs 2 and 3, a Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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