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TMI Blog2022 (8) TMI 780X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessing Officer for adjudication after verifying the proportionate amount and grant relating to different asset and applying the actual rate of depreciation which relate to these assets. Ground No. 1 is partly allowed for statistical purpose. Nature of expenditure - Disallowance under head small low value items written off on the ground that the same is not revenue expenditure - HELD THAT:- It is pertinent to note that the assessee had claimed small and low value items written off under the head other misc expenses in the Profit Loss account and the same was properly quantified by the assessee. Similar expenses were allowed in subsidiary company i.e. Madhya Gujarat Vij Company Limited [ 2022 (2) TMI 1277 - ITAT AHMEDABAD] - The facts are identical and hence ground No. 2 is allowed. Miscellaneous losses and write offs - disallowance on the ground that the claim has not been substantiated by any documentary evidences - HELD THAT:- In the subsidiary company of the assessee, similar miscellaneous losses and write-offs were allowed on the ground that these losses are on account of loss of materials through pilferage, shortage of material in transit, shortage arising ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... siness income. The CIT(A) has given detailed finding to this issue and there is no need to interfere with the same. Ground No. 2 for A.Y. 2011-12 filed by the assessee is dismissed. Disallowance and increase in power purchase cost - DR submitted that the purchase claim made by the assessee is without any support of documentary evidences and the assessee failed to prove genuineness of the entire purchase cost of fuel power debited in its books of account - HELD THAT:- There is a categorical finding given by the CIT(A) after calling the remand report from the Assessing Officer that the assessee furnished ledger account of power purchase, reconciliation of actual and estimated units of power purchase, together with copies of journal vouchers and invoices for power purchase which were not produced before the Assessing Officer at the time of assessment proceedings. The CIT(A) further observed that the claim of the assessee was rightly proved with the additional bills, reconciliation of bills and invoices was produced before the CIT(A). In the remand report the Assessing Officer has not pointed out any discrepancy to these details but simply submitted that the addition be sustained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. First we take up the appeal filed by the assessee for the Assessment Year 2008-09 i.e. ITA No. 2081/Ahd/2012 and the grounds raised in this appeal are reproduced as under:- 1.0 The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the reduction of the amount of Capital Grants Subsidies and Consumers' Contribution aggregating to Rs. 2,76,74,39,000/- from the total cost of the Plant Machinery for the purpose of allowing depreciation and has thereby confirmed the restriction of the appellant's claim of depreciation to Rs. 41,46,04,133/- as against Rs. 77,03,58,974/- claimed by the appellant. 2.0 The Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the disallowance amounting to Rs. 35,000/- under the head small low value items written off on the ground that the same is not revenue expenditure. 3.0 The Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the disallowance of Miscellaneous losses and write offs amounting to Rs. 18,98,964/- on the ground that the claim has not been substantiated by any documentary evidences. 4.0 The Commissioner of Income Tax (Appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed all the relevant material available on record. The facts of the present assessee's case are identical to that of Madhya Gujarat Vij Company Limited (supra) decided by the Tribunal. Here also, the uniform rate of 15% was adopted by the CIT(A). As per provisions of Section 43(1) of the Act the capital grant should be reduced from the cost/WDB of the relevant asset and thereafter the depreciation has to be calculated which is capital grant receipt in respect of asset on which depreciation is allowable at the rate different from 15% should be worked out as per the applicable rate. Here also the Ld. DR could not point out any mistake in the above submissions of the assessee which are in consonance with law. Therefore, we restore the matter back to the file of Assessing Officer for adjudication after verifying the proportionate amount and grant relating to different asset and applying the actual rate of depreciation which relate to these assets. Ground No. 1 is partly allowed for statistical purpose. 8. As regards Ground No. 2 relating to disallowance amounting to Rs. 35,000/-, the Ld. AR submitted that similar issue has been allowed by the Tribunal in Madhya Gujarat Vij Compa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Year. There is no need to interfere with the said finding and the Assessing Officer was rightly directed to verify the issue, so if any prior period income was already taxed then the said relief should be given to the assessee. Ground No. 4 is dismissed. 17. As regards ground No. 5, the same is not pressed by the Ld. AR and hence dismissed. 18. Thus, ITA No. 2081/Ahd/2012 filed by the assessee is partly allowed for statistical purposes. 19. As regards appeal filed by the assessee for the Assessment Year 2011-12 i.e. ITA No. 2570/Ahd/2014, the grounds raised in this appeal are reproduced as under:- 1.0 The learned Commissioner of Income Tax (Appeals) erred in law and on facts has confirmed the additions of Rs. 28,81,30,950/- on account of Capital Grants Subsidies and Consumers' Contribution on the ground that the appellant should transfer 15% of the total Grants/subsidies/consumer contribution received during the year as against 10% offered by the appellant. 2.0 The learned Commissioner of Income Tax (Appeals) erred in law and on facts in confirming the additions with respect to the interest income from other loans amounting to Rs. 1,35,74,000/-/Rs. 69,50,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ically held that the interest earned on loan and advance from deposits with Mega Power Project towards SITS sharing and power are directly related to business of the assessee. But the said component does not include interest on small loans and advances. The decision given by the Ld. AR in case of Odisha Power Generation Corporation Limited vs. ACIT (supra) has also not specifically mentioned about the nomenclature of interest derived from loans and advances to the staff. Though the contentions of the assessee therein were quoted by the Hon'ble Orissa High Court but whether the same was accepted is not mentioned in the order. Thus, the decisions quoted by the Ld. AR will not be helpful in the present assessee's case. Loans to staff members cannot be treated as business expenses and therefore interest on these loans and advances given to staff members cannot be treated as business income. The CIT(A) has given detailed finding to this issue and there is no need to interfere with the same. Ground No. 2 for A.Y. 2011-12 filed by the assessee is dismissed. 25. As regards ground No. 3 related to charging of interest under Section 234B 234C, the same is consequential, hence no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has not given the details of purchase cost before the Assessing Officer. 29. The Ld. AR relied upon the order of the CIT(A). 30. We have heard both the parties and perused all the relevant material available on record. There is a categorical finding given by the CIT(A) after calling the remand report from the Assessing Officer that the assessee furnished ledger account of power purchase, reconciliation of actual and estimated units of power purchase, together with copies of journal vouchers and invoices for power purchase which were not produced before the Assessing Officer at the time of assessment proceedings. The CIT(A) further observed that the claim of the assessee was rightly proved with the additional bills, reconciliation of bills and invoices was produced before the CIT(A). In the remand report the Assessing Officer has not pointed out any discrepancy to these details but simply submitted that the addition be sustained without verifying these documents. The CIT(A) has given detailed finding and there is no need to interfere with the same. Hence, ground No. 1 of Revenue's appeal for A.Y. 2011-12 is dismissed. 31. As regards ground No. 2 of Revenue's appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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