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2017 (5) TMI 1727 - AT - Income TaxReopening of assessment u/s 147 - satisfaction of conditions laid down in the statute for the issuance of notice under section 148 - HELD THAT:- We find to the AO had applied his independent mind on the basis of material available on record for A.Y. 2008-08 and also for assessment year under consideration and find that the information pointed out by the audit was on factual error. AO has formed his opinion about reason to believe that income chargeable to tax had escaped assessment. Reopening of assessment is perfectly in accordance with law hence same is upheld. This ground of appeal of the assessee is therefore dismissed. Disallowance of claim of additional depreciation u/s 32 (1) (iia) on Wind Electric Generator - assessee's case is that by using "windmill" the assessee is producing an article or a thing as define under section 32 (1) (iia) hence, it is entitled to additional depreciation - HELD THAT:- In the instant case, it is not in dispute that new machinery or plant has been acquired and installed after the 31st March 2005. It is also not in dispute that the assessee has claimed depreciation u/s 32(1)(ii) of the Act. Once the AO has accepted the assessee's claim u/s 32(1)(ii) of the Act, we do not see a reason why the assessee should be denied the claim of additional depreciation on the same assets u/s 32(1)(iia) of the Act. We find that it is now a settled proposition as held by the Hon'ble Supreme Court and the various Co-ordinate Benches of the Tribunal that the process of generation of electricity is akin to manufacture of an article or thing, the assessee in the instant case satisfy the requirement that it is engaged in the business of manufacture or production of an article or thing. Coming to the amendment which has been brought-in by the Finance Act 2012 w. e. f. A.Y. 2013-14 whereby the assessee engaged in the business of generation or generation & distribution of power have specifically been included and held eligible for claim of additional depreciation. In our view, the said amendment cannot be held to disentitle the assessee to claim of the additional depreciation. Various Coordinate Benches have held that even prior to the amendment brought in by the Finance Act 2012, that the assessees engaged in generation or generation and distribution of electricity were held eligible for additional depreciation. The said amendment cannot be read to negate the settled legal position that generation of electricity is akin to manufacture or production of an article or thing. As held by Coordinate Bench in M Satishkumar [2012 (11) TMI 215 - ITAT CHENNAI ] the said amendment by the Finance Act 2012 gives an impetus to the view that generation of electricity is a manufacturing process. Assessee is held entitled to the additional claim of depreciation on the power plant and the windmill installed during the year. Hence, the ground of the assessee is allowed. Charge of interest u/s. 234B (3) - HELD THAT:- We find that the charging of interest under section 234B(3) is mandatory as held in the case of CIT v. Anjum M. H. Ghaswala [2001 (10) TMI 4 - SUPREME COURT] - Interest would be chargeable as per law laid down by Vijay Kumar Saboo (HUF) v. Asstt. CIT[2011 (7) TMI 135 - KARNATAKA HIGH COURT]. However, as we allowed the main ground of appeal on favour of the assessee it becomes academic in nature and consequential in nature and not required adjudication. However, we held the assessee is entitled to consequential relief if any as arise out on giving effect to this order in a case with law.
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