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2016 (2) TMI 377 - ITAT CHENNAI

2016 (2) TMI 377 - ITAT CHENNAI - TMI - Disallowance of deprecation on windmills on WDV Method - methodology of claim of deprecation - assessee claimed deprecation at 80% on written down value method instead of straight line method at 7.69% - Held that:- Since the assessee company claimed depreciation on straight line method for the assessment year 2009-2010 and cannot have different methodology of deprecation for the subsequent years. We rely on the decision in the case of CIT vs. Kikani Export .....

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something more into second proviso to Rule 5(1A), that an option should be exercised separately would make returns filed meaningless. Thus if assessee exercised option in terms of second proviso to Rule 5(1A) at time of furnishing of return of income, it will suffice and no separate letter or request or intimation with regard to of exercise of option is required. Further option once exercised will continue to all subsequent years, assessee is not required to exercise such option each and every .....

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peals are filed by the assessee are directed against differents order of Commissioner of Income-tax (Appeals)-1, Coimbatore, Dated 05.03.2015 for the assessment years 2010-2011 and 2011-2012 passed u/s.143(3) r.w.s.147 and 250 of the Income Tax Act, 1961 . 2. The assessee has raised only one substantive ground in respect of disallowance of deprecation on windmills on WDV Method for both assessment years. Since the issue in these appeals are common in nature, these appeals are clubbed, heard toge .....

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iation on windmill at 80% on WDV method in the return of income as against @7.69% on straight line method and issued notices u/s.148 and also 143 (2) of the Act and posted the case for hearing. In the re-assessment proceeding, the ld. Authorised Representative for assessee appeared from time to time and filed details of deprecation claimed at 80% on windmills u/s. provisions of Sec. 32 of the Act instead of SLM rate at 7.69% as per Act and submitted that the company has erected wind mills during .....

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e due date u/s.139(1) of the Act for the assessment year 2009-10 being the first year of claiming deprecation on windmills installed in the previous year 2008-2009. The assessee has filed belated return for the assessment year 2009-2010 on 23.12.2009 and not filed option of claim for deprecation before due date of filing of return u/s.139(1) of the Income Tax Act to comply the provisions and explanation (ii) of Sec.32(1) of I.T Act read with Rule 5(1A) of Income Tax Rules, 1962. Appling the lega .....

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orders for assessment years 2010-2011 and 2011-12 passed by the Assessing Officer, the assessee filed appeals before the Commissioner of Income Tax (Appeals). 4. In the appellate proceedings, the assessee has raised grounds and also challenged validity of reopening of assessment u/s.147 of the Act. The ld. Authorised Representative has reiterated his submissions made before the Assessing Officer and also relied on the decision of Co-ordinate Bench of the Tribunal in the case of M/s. KKSK Leather .....

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er of the Tribunal and concluded that since the windmills were installed for the first time in the financial year 2008-2009 being the first year and the assessee has not filed return of income for the assessment year 2009-2010 within the due date. Therefore, depreciation for subsequent years shall be allowed only on SLM basis and confirmed the order of the Assessing Officer. Aggrieved by the orders of the Commissioner of Income Tax (Appeals), the assessee filed appeals before the Tribunal. 5. Be .....

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of Sec.32 (1) of the Act r.w.r 5(1A)of Income Tax Rules, 1962 for claim of depreciation and prayed for allowing the appeals. 6. On the other hand, the ld. Departmental Representative has relied on the orders of lower authorities and argued that case laws referred by the Authorised Representative are not applicable in the present context and prayed for dismissal of the appeals. 7. We heard the rival submissions of both the parties, perused the material on record and also judicial decisions cited .....

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of the Act in respect of deprecation of assets acquired on or after 1st day of April,1997 shall be calculated at the percentage specified in the second column of the Table in Appendix IA of these rules on the actual cost thereof to the assessee as are used for the purpose of the business of the assessee at any time during the previous year. Provided that the aggregate deprecation allowed in respect of any asset for different assessment years shall not exceed the actual cost of the said asset. P .....

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997; and (b) For the assessment year relevant to the previous year in which it begins to generate power, in case of any other undertaking: Provided also that any such option once exercised shall be final and shall apply to all the subsequent assessment years. In the present case, the assessee has filed return of income for the assessment year 2009-2010 belatedly on 23.12.2009 being the first year of installation of windmill and deprecation was claimed, further no option exercised by the company .....

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