TMI Blog2012 (4) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... eciation was for the first year, the depreciation was claimed on the original cost even though at a wrong rate and in the impugned assessment year, the depreciation was claimed again at wrong rate but on WDV method. Therefore, it is very clear that the assessee has exercised its option for choosing the method of providing for depreciation as prescribed in the statute - the assessee asked for adopting the correct rate which is in fact, was only a prayer to rectify a mistake apparent on record and not making any fresh claim no revised return need to filed – appeal of revenue rejected - IT Appeal No. 2081 (Mds.) of 2010 - - - Dated:- 8-3-2012 - Dr. O.K.NARAYANAN, VIKAS AWASTHY, JJ. ORDER Dr. O.K. Narayanan, Vice-President The appeal is filed by the Revenue. The cross objection is filed by the assessee. The relevant assessment year is 2007-08. The appeal and the cross objection are directed against the order passed by the Commissioner of Income-tax(Appeals) at Salem on 20.09.2010 and arise out of the assessment completed under sec.143(3) of the Income-tax Act, 1961. 2. The assessee had installed a windmill in Maruthur Village of Tharapuram Taluk in the later half of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingly, the Commissioner of Income-tax(Appeals) adjudicated the matter in favour of the assessee by giving a direction to the Assessing Officer to grant the assessee depreciation at the rate of 80% on WDV method. 5. The Revenue is aggrieved, and, therefore, the second appeal before us. 6. The relevant grounds raised by the Revenue are extracted below : "2. The CIT(A) has failed to appreciate the fact that neither for the current assessment year 2007-08, nor for the earlier assessment year 2006-07 in which the windmill in question had been installed, the assessee had exercised the option, in some way or other, to indicate that they wanted the benefit of WDV rate of depreciation and not under the straight line method. 3. The CIT(A) has erred in stating in Page No.11, Para 8 of his order that 'The appellant has claimed wrong rate of depreciation and in the return filed for the A.Y. 2007-08 rectified the mistake of rate of depreciation .' It is not correct that the assessee rectified the mistake of rate of depreciation in the return. The correct fact is that during the assessment proceedings assessee filed merely a letter rectifying the said mistake. 4. The Income-tax Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on other than by filing a revised return?'. It has been held that 'there was no provision under the Income-tax Act to make amendment in the return of income by modifying an application at the assessment stage without revising the return'. In this case the assessee has not made any claim by way of revised return." 7. The grounds in the cross objection filed by the assessee in fact, do support the order of the Commissioner of Income-tax(Appeals) and the ultimate prayer was only to dismiss the appeal preferred by the Revenue. 8. Shri KEB Rengarajan, the learned Standing Counsel appearing for the Revenue contended that even if no format is prescribed for exercising the option of choosing the method of depreciation available on the windmill, it is incumbent upon the assessee to demonstrate that the assessee has opted for a particular method which should be communicated before due date of filing of the return. In the present case, as the assessee had claimed depreciation for the earlier assessment year on straight-line method, the same method and rate were followed for the subsequent impugned assessment year and in such circumstances, it is very evident that the assessee has opte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the assessee has opted for depreciation on WDV method. 13. Regarding the correct rate of depreciation, the learned authorized representative submitted that the assessee has not made any claim for any fresh deduction in the course of assessment proceedings. The assessee has already made its claim for the statutory allowance of depreciation, but, the assessee applied incorrect rate. By pointing out the correct rate of depreciation, the assessee was in fact, requesting the Assessing Officer to rectify a mistake apparent on record and the assessee was not praying for any deduction for the first time. 14 . He, therefore, submitted that the Commissioner of Income-tax(Appeals) is right in giving direction to the Assessing Officer to grant depreciation on WDV at the appropriate rate of 80%. 15. He has also relied on the decision of the Hon'ble Punjab Haryana High Court rendered in the case of CIT v. Ramco International (332 ITR 306); the decision of the Hon'ble Gujarat High Court in the case of Chokshi Metal Refinery v. CIT (107 ITR 63) and the decision of the ITAT, Chennai Bench 'D' in the case of K.K.S.K. Leather Processors (P) Ltd. v ITO (126 ITD 215). 16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for adopting the correct rate which is in fact, was only a prayer to rectify a mistake apparent on record. The assessee was not claiming any fresh claim before the assessing authority. Therefore, the judgment of the Hon'ble Supreme Court in the case of Goetze (India) Ltd. v. CIT (284 ITR 323) does not apply to the present case. 19. The above position is fortified by the order of the ITAT, Chennai Bench 'D' rendered in the case of K.K.S.K. Leather Processors (P.) Ltd. (126 ITD 215). The Tribunal, after examining the Explanation 5 to sub-sec. (1) of sec.32, held that the provisions of sub-sec.(1) of sec.32 was applied whether or not the assessee has claimed the deduction in respect of depreciation in computing his total income. The Tribunal held that the Assessing Officer is duty bound and under obligation to allow the deduction of depreciation as per the provisions of sec.32(1). When such a statutory obligation is cast on the assessing authority, it is incumbent on him to apply the correct rate of depreciation, especially in the present case where the option exercised by the assessee is manifestly clear. 20. In the present case, the assessee has not made any fresh clai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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