TMI Blog2013 (8) TMI 283X X X X Extracts X X X X X X X X Extracts X X X X ..... vity - The assessee is involved in the manufacturing activity and fulfills the conditions as laid down under section 32(1)(iia). The Government vide Finance Act, 2012 has amended the provisions of section 32(1)(iia) to include the business of generation or generation and distribution of power - Decided against Revenue. - ITA No. 832/Bang/2012 - - - Dated:- 2-8-2013 - Shri George George K. And Shri Jason P. Boaz,JJ. For the Petitioner : Shri Farhat Hussain Qureshi, DR For the Respondent : Shri N. R. Tirumal, CA ORDER Per George George K. J.M. This appeal at the instance of the Department is directed against the order of the CIT (A)-III Bangalore dated 30.03.2012 in relation to assessment year 2008-09. 2. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are organized as a separate business called as wind power Division is evident from the letter heads produced by the assessee. In so far as this line of business is concerned, the power generated in the windmill is directly supplied to KPTCL and invoiced as per power purchase agreement. Therefore, the power produced by this plant machinery has not been used in the production of either ore or fine gold which are the products of the assessee. In this view, the plant machinery of windmill cannot be held as installed for the business of manufacture of production of gold. Therefore, the assessee is not eligible for additional depreciation on windmill. The claim of ₹ 2,75,87,268 made under this head is accordingly denied . 4. The asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng run, and the power is being sold to KPTCL through a Power Purchase Agreement, an arrangement which has been accepted by the AO on scrutiny of the case. Hence, it is clear that the windmills are being used for the appellant's business purposes. Additional depreciation on them as available per law cannot therefore be denied on this ground. The disallowance of ₹ 2,75,87,268 made by the AO is accordingly deleted and the appellant gains relief to this extent under this ground of appeal . 5. The Revenue being aggrieved is in appeal before us raising the following effective grounds: 2. The CIT (A) erred in granting additional depreciation of ₹ 2,75,87,268 on cost of windmill while such benefit u.s 32(1)(iia) is allowable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely mining and extraction of gold. The use of electricity in the manufacturing activity of the core business of the assessee is not a precondition for the grant of additional depreciation under the statue. 7.1 The amendment brought about in section 32(1)(iia) by the Finance Act, 2012 to include the business of generation and distribution of power to the benefit of additional depreciation is only clarificatory. A similar view has been held by the Hon'ble Chennai Bench of the Tribunal in the case of ACIT vs. M Satish Kumar in ITA No.718/Mds/2012 dated 28th September, 2012. The relevant findings of the Tribunal read as follows: 9. We have heard the submissions made by the respective parties and have also examined the judgments order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the CIT(A) is upheld and the appeal of the Revenue is dismissed being devoid of merit. 7.2 The plea of the Revenue raised in Ground No.3 is also devoid of merits, since in the relevant previous year (the year in which the windmills were installed), assessee was entitled to depreciation only at the rate of 80%. The assessee would not have been entitled to additional depreciation, if the assessee was eligible for 100% depreciation. 8. In view of the aforesaid reasons and following the order of the Coordinate Bench of the Tribunal in the case of ACIT vs. M. Satish Kumar (Supra), we uphold the order of the CIT (A). It is ordered accordingly. 9. In the result, appeal filed by the Revenue is dismissed. Order pronounced at the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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