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DCIT, CIRCLE 13 (1) , NEW DELHI Versus M/s NALWA STEEL & POWER LIMITED,

2016 (9) TMI 761 - ITAT DELHI

Depreciation on electrical installation - rate of depreciation applicable - Held that:- The electrical installations formed an integral part of the assessee's plant, therefore, depreciation was allowable at the rate applicable to plant and machinery. We are also of the considered view that electrical installation is integral to the plant and machinery used for manufacturing steel and as the Assessing Officer has not controverted the contentions of the assessee company hence, Ld. CIT(A) has right .....

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010 - Dated:- 9-8-2016 - SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADI N. MISHRA, ACCOUNTANT MEMBER For The Department : Sh. UC Dubey, Sr. DR For The Assessee : S h . V.K. Tulsiyan, CA ORDER PER H.S. SIDHU : JM The Revenue has filed the present appeal against the impugned order dated 08/7/2010 passed by the Ld. Commissioner of Income Tax (Appeals)-XVI, Delhi on the following grounds:- 1. That on the facts and circumstances of the case and in law, the Ld. CIT(A) erred in directing the A.O. to a .....

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ns formed an integral part of the assessee's plant, therefore, depreciation was allowable at the rate applicable to 'Plant & Machinery' whereas depreciation to electrical fittings can only be allowed under "Furniture & Fittings" as per II Part A r.w. Part B Note N.5 of the Depreciation Table. 4. That on the facts and circumstances of the case and in law the Ld. CTI(A) erred in relying upon the case laws of the Punjab & Haryana High Court in the case of CIT Vs. O .....

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of 'electrical fittings' but the block applicable to electrical item is 'Furniture & Fittings' which also includes electrical items and the applicable rate of depreciation is 10%. 6. The appellant craves to be allowed to add any fresh grounds of appeal and/or delete or amend any of the grounds of appeal. 2. The facts in brief are that the assessee company is engaged in the business of manufacturing and selling of Sponge Iron, Billets, Wire Rod, Oxygen Gas and generation of p .....

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s issued and served upon the assessee fixing the date of hearing on 18-03-2008. In compliance to the above notices Assessee s Authorised Representative and official of the assesee company attended the proceedings and produced the details called for which have been verified on test check basis. Thereafter, the AO observed that since the tax on book profit u/s. 115JB of I.T. Act of ₹ 31,14,79,013/- is more than the tax on income as per normal provisions of the I.T. Act, assessed at Book Prof .....

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order of the AO and reiterated the contentions raised by the Revenue in the grounds and requested that Appeal of the Revenue may be allowed. 6. On the contrary, Ld. Counsel of the Assessee has relied upon the order of the Ld. CIT(A) and stated that he has passed a well reasoned order which does not need any interference, hence, the same may be upheld. 7. We have heard both the parties and perused the records, especially the impugned order passed by the Ld. CIT(A). We find that Ld. First Appella .....

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disallowance of additional depreciation claimed for ₹ 1,02,12,533/- is not in order. 3.1 It is submitted by the Ld. AR that the appellant company is engaged in the manufacturing of iron and steel. It employs continuous process plant facilities for such manufacturing. The appellant company also has its captive power generation unit to generate and supply electricity to the plant as power constitutes a critical need in steel-and iron manufacturing operations. During the previous year the ap .....

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ven. These cannot be considered de hors the plant and machinery employed in production. The appellant company has thus claimed depreciation on such electrical installations under the block of assets 'plant & machinery' and claimed depreciation @ 15% and an additional depreciation of 10% on the same. For instance, armoured cables are used for power supply to the plant as well as for distribution of power between sub-stations. Control panels are used to control and regulate the flow of .....

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rred to the Gujarat High Court judgment in the case of CIT vs. Starlight Silk Mills P. Ltd. [2006] 280 ITR 257 which held that AC plants, electric installation and transformers form integral part of plant and machinery. Further reliance is placed on the case laws of Mihir Textile Ltd. vs. CIT (2001) 252 ITR 686, Tribeni Tissues Ltd. (1994) 206 ITR 92 (Cal), CIT vs. Oswal Woollen Mills Ltd. (2007) 289 ITR 261 (P&H), CIT vs. Indian Turpentine and Rosin Co. Ltd. (1070) 75 ITR 533 (All) and of A .....

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n the case CIT vs. Oswal Woollen Mills Ltd. (supra), the Punjab and Haryana High Court applied Berger Paints India Ltd. vs. CIT 266 ITR 99 and followed Bharat Earthmovers vs. CIT 245 ITR 428, CIT vs. Oswal Woollen Mills Ltd. 254 ITR 666, CrT vs. Oswal Woollen Mills Ltd. 257 ITR 737 and CIT vs. Starlight Silk Mills P. Ltd. 280 ITR 257 and upheld the Tribunal's decision that the electrical installations formed an integral part of the assessee's plant, therefore, depreciation was allowable .....

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allowed as the assessing officer disallowed the same considering electrical installations as part of furniture and fixture. 7.1 After going through the findings of the Ld. CIT(A), as aforesaid, in our considered view, on the anvil of the decision in the case of CIT vs. Oswal Woollen Mills Ltd. (supra), the Punjab and Haryana High Court applied Berger Paints India Ltd. vs. CIT 266 ITR 99 by following the case of Bharat Earthmovers vs. CIT 245 ITR 428, CIT vs. Oswal Woollen Mills Ltd. 254 ITR 666 .....

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