TMI Blog2012 (12) TMI 485X X X X Extracts X X X X X X X X Extracts X X X X ..... armarked to facilitate a flow of wind without hindrance, and specialized electrical fittings and high tension lines are all basic requirements for a wind mill plant. None of these requirements including the premises can be seen detached from what is called a ‘wind mill’ since a wind mill to work these are essential. All these are necessary inputs going into ultimate cost of such wind mill. In favour of assessee Disallowance u/s 14A – Held that:- In view of the smallness of quantum of new investments made during the relevant assessment year to the tune of Rs.1,61,124/-, no addition is warranted. Issue decides in favour of assessee. - ITA Nos.1391, 1392 & 1655/Mds/2011 - - - Dated:- 24-7-2012 - Dr. O.K. NARAYANAN AND SHRI VIKAS AWASTHY ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee was not entitled to higher rate of depreciation on civil works and cost of electrical transformer. The Assessing Officer was of the view that the assessee cannot club such items to take advantage of higher depreciation. Electrical transformer cannot be taken as part of the windmill and the inner approach roads are not entitled for depreciation at higher rates. The Assessing Officer reworked the depreciation and allowed depreciation to the tune of 15% on cost of electrical equipment i.e. transformer and meter and 5% on approach road. On the basis of the aforesaid observations, the Assessing Officer disallowed the higher rate of depreciation on the cost of transformers and civil works in the assessment year 2006-07, 2007-08 and 2008- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have heard the rival contentions and perused the order. There can be no dispute that a wind mill is an apparatus that harnesses wind power, for a variety of uses like pumping water, driving of saw mill, grinding cone and/or driving electrical turbines. A typical wind mill, as installed by the assessee, which is of Suzlon Corporation, would consist of a specialized foundation, on which the wind blades are attached through a post. The Blades connected in the top is a revolving apparatus to which different numbers of arms are attached. When it is used for producing electricity, these are called wind turbines and serves as a significant source of electrical energy. Being a non-conventional source of energy with renewable inputs and which is na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rement, it would qualify to be treated as a plant. In our opinion, the 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. If we look at Appendix I to the Income-tax Rules, prescribing the rates of depreciation, it can be seen that Legislature has given higher depreciation rate of 80% on anti-pollution devices, energy saving and renewable energy devices. Apparently, these higher rate have been given not solely for offsetting the impairment in value of such assets on account of use but also to encourage such entrepreneual ventures which results in energy savings or utilization of renewable energy sources, or preven ..... X X X X Extracts X X X X X X X X Extracts X X X X
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