TMI Blog2017 (12) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... eld further that the year of commencement alone need not be the 'initial year'. The year of claim also can be considered as 'initial assessment year'. The said judgment has also been followed by different benches of the Hon'ble ITAT. Apart from above, Ld. AR has also drawn our attention to paper book page no. 4 which relates to Circular nO. 1/2016 issued by CBDT dated 15.02.16 wherein it has been clearly held that the term ‘initial assessment year’ would mean the first year opted for by the assessee for claiming deduction u/s 80IA. We have also . . noticed that in the above circular, a direction has been given to the AO to allow deduction u/s 80IA and pending litigation on allowability of deduction u/s 80-IA shall also not be pursued to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case the assessee company also has other sources of income from . . various non-eligible businesses and hence the ratio of this judgement is not applicable to the present case . The appellant prays that the order of the CIT(A) on the above ground above set aside and that of the A,O. be restored. The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary. 2. As per the facts of the present case, the assessee company has set up a wind mill at village Navadra of taluka Kalyanpur, Distt-Jamnagar, Gujarat and has shown receipts of ₹ 61,87,740/-. The assessee had claimed deduction u/s 80IA amounting to ₹ 52,88,366/-. The AO was of the view that since the wind mill project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 to 10 the action of the AO of disallowing the deduction u/s 80IA by applying the provisions of section 801A(v) by calculating the profits on wind mill business starting from the year in which said wind mill was setup and not from the initial assessment year in which the deduction has been claimed for the first time, has been challenged by the appellant. The AO has relied upon the decision of tribunal in the case of ACIT vs Gold Mine Shares and Finance 116 TTJ 705 for doing so. According to the A/R of the appellant the Madras High Court in the case of Velayudhaswamy Spg. Mills (P.) Ltd. v. Asstt. CIT [20121 340 ITR 477/21 taxmann.com 95 clearly held that 'where the depreciation and loss of earlier assessment years have alr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Held, yes [Paras 10, 12 13] [In favour of assesseel The Jurisdictional bench of the ITAT while dealing with the matter of 263 invoked by CIT held that:- . . Moreover, the claim of deduction under section 80-IA was based on a possible legal view which has been allowed by the Assessing Officer, therefore, it cannot be held that the same is erroneous insofar as it is prejudicial to the interests of the revenue. Thus on this count, there was no reason to uphold the cancellation of assessment order under section 263 on the ground that it is erroneous insofar as it is prejudicial to the interests of Revenue. Consequently, the impugned order passed under section 263 by the Commissioner is set aside and the assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'initial year' . The year of claim also can be considered as 'initial assessment year' . The said judgment has also been followed by different benches of the Hon'ble ITAT. Apart from above, Ld. AR has also drawn our attention to paper book page no. 4 which relates to Circular nO. 1/2016 issued by CBDT dated 15.02.16 wherein it has been clearly held that the term initial assessment year would mean the first year opted for by the assessee for claiming deduction u/s 80IA. We have also . . noticed that in the above circular, a direction has been given to the AO to allow deduction u/s 80IA and pending litigation on allowability of deduction u/s 80-IA shall also not be pursued to the extent it relates to interpretin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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