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Income Tax Appellate Tribunal, ‘C’ BENCH : CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI ABRAHAM P. GEORGE]
आदेश / O R D E R
PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER
In this appeal filed by the Revenue, it is aggrieved that ld.
Commissioner of Income Tax (Appeals) allowed depreciation at 80% on the civil works of windmills.
ITA No.2224/Mds/2016. :- 2 -:
Ld. Counsel for the Revenue submitted that ld. Assessing Officer had relied on the decision of Pune Bench of the Tribunal in the case of Poonawala Finvest & Agro (Pvt ) Ltd vs. ACIT (2008) 12 DTR 211 (Pune) while disallowing enhanced depreciation claimed on civil works of the windmills. According to him, civil works in the nature of control room and building housing the windmill could not be considered as ‘’windmill’ for higher depreciation.
Per contra, and in support of the order of the ld. 3.
Commissioner of Income Tax (Appeals), ld. Authorised Representative pointed out that similar issue had come up before this Tribunal on Revenue’s appeal for assessment years 2010-2011 and 2011-2012.
According to her, this Tribunal had held that enhanced depreciation would be available for civil construction used for installation of windmills. Reliance was also placed on the decision of Co-ordinate Bench in the case of ACIT vs. Kutti Spinners (P) Ltd, (2014) 34 ITR (Trib) 0470.
We have perused the orders and heard the contentions. We find that a similar issue had come up before this Tribunal in Revenue’s appeals for assessment years 2010-2011 and 2011-12 (in ITA Nos.
1000 & 10001/Mds2016, dated 23.09.2016) where the respondent
ITA No.2224/Mds/2016. :- 3 -: was the assessee. It was held by the Co-ordinate Bench as under:-
‘’5. We have considered the rival submissions on either side and perused the relevant material available on record. The question arises for consideration is when the assessee constructed a building for the purpose of erection of windmill, whether such a building would form part of windmill? This Tribunal is of the considered opinion that the windmill cannot exist without a civil foundation. Therefore, the civil work / building constructed by the assessee for the purpose of installation of windmill has to be necessarily construed as part of windmill. In other words, the windmill cannot exist without civil construction. Therefore, the civil construction as well as the windmill has to be construed as single unit for the purpose of depreciation. Accordingly, the assessee is eligible for depreciation at the rate of 80%. This Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed’’.
Further, we find that ld. Commissioner of Income Tax (Appeals) had duly considered the decision of Pune Bench of the Tribunal in the case of Poonawala Finvest & Agro (Pvt ) Ltd (supra) before deciding to follow the decision of Co-ordinate Bench in the case of Kutti Spinners (P) Ltd (supra). Ld. Commissioner of Income Tax (Appeals) in our opinion cannot be faulted for giving preference to decision of the Jurisdictional Tribunal rather than that of a bench situated elsewhere.
We thus, do not find any reason to interfere with the order of the ld. ITA No.2224/Mds/2016. :- 4 -: Commissioner of Income Tax (Appeals). In the result, the appeal of the Revenue is dismissed. 5. Order pronounced on Thursday, the 22nd day of June, 2017, at Chennai.