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2012 (10) TMI 351 - AT - Income TaxDepreciation on windmill - treatment of building as plant - – Held that:- The assessee is entitled to entire amount claimed as depreciation on windmill. Expenses relating to the land and foundation specially incurred with a view to serve the technical requirements would also become a part of the plant in a case that of a wind mill. As decided by Court in case OF [Commissioner Of Income-Tax Versus Karnataka Power Corporation 2000 (7) TMI 72 - SUPREME COURT] whether a the building can be treated as a plant was a question of fact and when it is found as a fact that the building has been so planned and constructed as to serve the assessee’s special technical requirement, it would qualify to be treated as a plant – in favour of Assessee. Disallowance of Expenses - The Assessing Officer disallowed 2% of such expenses claimed on the vouchers directly without supported by any bill. The assessee claimed weaving, tailoring, samples and packing charges to the tune of Rs. 3.36 crores in its profit and loss account. The Assessing Officer disallowed 2% of such expenditure amounting to Rs. 6,72,089/-. The ld. CIT(A) confirmed the addition. It was submitted that for the Assessment Year 2005-06 on identical facts the Assessing Officer disallowed 1% for such expenses on estimate basis on a turnover of Rs. 4.04 crores. Held that:- Having regard to the nature of business it is not possible to maintain all the bills and vouchers. However, the assessee maintained meticulously all the records and the expenses were duly recorded in the internal debit vouchers disallowance of 1% of such expenses would meet the ends of justice. - Decided in favor of assessee.
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