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TMI Blog2014 (11) TMI 1121X X X X Extracts X X X X X X X X Extracts X X X X ..... )(C)-II Chennai dated 31.10.2013, passed in I.T.A.Nos.364 to 367/13-14, in proceedings under section 143(3) of the Income-tax Act, 1961 (in short the 'Act'). 2. For the sake of convenience and brevity, we proceed assessment year wise to decide this batch of six appeals. A.Y 2006-07 Revenue's appeal I.T.A.No.715/Mds/2014 3. The Revenue's sole substantive ground raised in this case (also common in all appeals) is that the CIT(A) has erred in allowing deduction u/s 80IA by treating each of the assessee's windmills a separate unit for granting additional depreciation benefit. 4. The assessee is a 'company' running wheat flour mills. It had filed its return on 25.11.2006 admitting income of Rs. 83,23,304/-. The same was 'summarily' processed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the already existing four wind mills and thereby increased its power generation capacity by above 50 per cent. It is true that the assessee is a company engaged in the business of manufacture of oil seeds, moulded rubber parts, reed value assemblies apart from generation of power. After the installation of the additional wind mills, both prior to as well as after the installation of the additional wind mills, the assessee was using wind energy for generating power for its captive consumption apart from selling the surplus power generated to the Tamil Nadu Electricity Board. As far as application of section 32(1)(iia) of the Act is concerned, what is required to be satisfied in order to claim the additional depreciation is that the settin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r thing that was already being manufactured by the assessee. Therefore, the contention that the setting up of a windmill had nothing to do with the manufacture of textile goods was totally not germane to the specific provision contained in section 32(1)(iia). [Para 5] It could also not be said that setting up of a windmill would not fall within the expression (setting up of a new machinery or plant). Therefore) there was no error in the conclusion of the Tribunal. [Para 6] .. " 5.3 Respectfully following the decision of the jurisdictional High Court of Madras in the cases reported in 321 ITR 477 (Mad) and 187 Taxman 319 (Mad) I hold that the appellant is entitled to additional depreciation under section 32(1)(iia). The AO is therefore d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... additional depreciation akin to that decided in preceding assessment years hereinabove. We follow suit in this impugned assessment year as well and uphold the CIT(A)'s findings. The Revenue's appeal I.T.A.No.717/Mds/2014 is dismissed. 10. Now we come to the assessee's appeal I.T.A.No.70/Mds/2014 challenging disallowance of Rs. 1,21,700/- made u/s 14A r.w.r 8D(2)(ii) of the Income-tax Rules. 11. In 'scrutiny', the Assessing Officer noticed the assessee to have made substantial investments in share holding of its subsidiary M/s Century Biscuits Ltd. It had also operated its mutual fund investment portfolio. The Assessing Officer drew an inference that the assessee's interest bearing loans or a part thereof had been diverted for these inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the depreciation claim @ 60% on UPS as against Assessing Officer's action restricting it @ 15% in the course of assessment. The assessee's grievance is also two folded. It challenges disallowance of Rs. 1,49,146/- u/s 14A r.w.r 8D(2)(ii) and the other of Rs. 58,98,472/- qua consignment sales. We proceed to deal with the Revenue's appeal first. 14. It is to be seen that the Revenue's former ground of additional depreciation is covered by our findings on identical issue decided hereinabove in preceding assessment years. The Revenue's ground is accordingly rejected. 15. The Revenue's second ground is regarding rate of depreciation on the assessee's UPS system. The Assessing Officer restricted this claim of depreciation @ 15%. The lower ..... X X X X Extracts X X X X X X X X Extracts X X X X
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