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TMI Blog2013 (12) TMI 1451X X X X Extracts X X X X X X X X Extracts X X X X ..... and sale of mineral water, ITC products, etc. and also generation of power through windmill, had filed his return admitting total income of Rs. 6,50,33,500, which includes capital gains at Rs. 5,08,92,200 and agricultural income of Rs. 5,89,753. The return of the assessee was processed under section 143(1) and later the case was taken up for scrutiny and after following due process, the assessment was completed under section 143(3) of the Act by determining total income at Rs. 6,58,89,953. Later on, a notice under section 263 of the Act dated May 2, 2012 was issued and served on the assessee. The relevant portion of the notice is reproduced as under : &nbs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord shows that the initial payment towards supervision charges made by the assessee to the TNEB was only on September 30, 2007. As all the other procedures are required to take place only after the initial payment, and that as the assessee has made the payment only on September 30, 2007, the erection work of the windmill could not have been completed and put to use on or before September 30, 2007. In addition, it is seen from the details available on record that the quantity of power generated by the assessee's new 600 KW windmill was more than two and a half times the power generated by the assessee's 225 KW windmill except for the month of October, 2007. Thus it is clear and logical that the said new 600 KW windmill was commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Tamil Nadu Electricity Board purchased the electricity generated from the said windmill and the sale proceeds are being offered for taxation regularly. The assessee also availed bank loan from Indian Bank. The Superintendent Engineer, TNEB, Udumalpet had issued a certificate by stating that the assessee's windmill generated as on September 30, 2007 : E x MF = 0.04 x 1000 = 40 units and this certificate was not disputed by the Department. He also submitted that the Chennai Bench of the Tribunal in I. T. A. No. 942/Mds/2012 for the assessment year 2007-08 vide order dated January 30, 2013 (since reported in D. M. Kathir Anand v. Asst. CIT (No. 1) [2014] 29 ITR (Trib) 747 (Chennai)) has also considered similar issue in the assessee' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Departmental representative has pointed out from the paper book page 15 that the invoice of the completion of civil work of windmill was on September 22, 2007. All the above facts leads to that it is impossible for the assessee to commence production of electricity on September 30, 2007 and supported the order passed by the learned Commissioner of Income-tax. 6. We have heard both sides, perused the materials on record and also gone through the orders of the authorities below. The case of the assessee is that the assessee is in the business of power generation through windmill. Accordingly to the assessee the windmill was erected, commissioned and after due inspection by the Chief Electrical Inspector to the Government, the windmill produc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, in our view, it is not a fit case to invoke section 263 of the Act. Apart from that, in similar circumstances for the assessment year 2007-08 in the assessee's own case, the Tribunal, on the basis of the certificate issued by the S.E., TNEB and also by following the decision of the hon'ble Madras High Court in the case of CIT v. Metal Powder Company Ltd. [2012] 75 DTR 233 (Mad). In this case, the Tribunal directed the Assessing Officer to allow depreciation based on the certificate issued by the State Electricity Board. The hon'ble High Court upheld the order of the Tribunal on the ground that when the Department has not questioned the certificate issued by the State Electricity Board, the Tribunal was justified in direc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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