TMI Blog2010 (7) TMI 1164X X X X Extracts X X X X X X X X Extracts X X X X ..... were for setting up of a windmill and such expenditure formed part of the erection cost of windmill and depreciation was required to be allowed on the entire cost including such civil and electrical works. As per the assessees, windmill purchase and installation was a turnkey project and there could not be any segregation of the expenses under different heads. 3. Short facts apropos are that all the assessees had incurred expenses for civil and electrical fittings, for setting up windmills. The A.O. disallowed such claim to the extent it consisted of cost of civil work and electrical fittings. According to the A.O., cost of civil work and electrical fittings were eligible for only 10% depreciation. The CIT (Appeals) also was of the opin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and equipments though attached to the windmill, could not be considered as its part warranting higher rate of depreciation. In other words, the A.O. has accepted the position that civil work and electrical equipments were for the installation of windmill. This being so, in our opinion, such expenses could not be considered as items which were not necessary for installation of the windmill. 7. With regard to the claim of enhanced depreciation for civil and electrical fittings, for windmills in our opinion, the decision in the case of M/s Asian Handloom referred to above is clearly in favour of assessee. This was further affirmed by a subsequent decision of a coordinate Bench in the case of M/s British Weaving Company v. DCIT in I.T.A. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereunder. 12. We have heard the rival contentions and perused the order. There can be no dispute that a wind mill is an apparatus that harnesses wind power, for a variety of uses like pumping water, driving of saw mill, grinding cone and/or driving electrical turbines. A typical wind mill, as installed by the assessee, which is of Suzlon Corporation, would consist of a specialized foundation, on which the wind blades are attached through a post. The Blades connected in the top is a revolving apparatus to which different numbers of arms are attached. When it is used for producing electricity, these are called wind turbines and serves as a significant source of electrical energy. Being a nonconventional source of energy with renewable inp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al technical requirement, it would qualify to be treated as a plant. In our opinion, the expenses relating to the land and foundation specially incurred with a view to serve the technical requirements would also become a part of the plant in a case that of a wind mill. Similarly, in the case of CIT v. Herdilia Chemicals (216 ITR 742), Hon ble jurisdictional High Court held that huge land measuring 360 acres taken on ease for the purpose of erection of plant and machinery where the entire factory was to be constructed in this land and expenses incurred for the foundation meant for fixing the machinery and for the purpose of leveling the land, formed a part of the cost of the plant. If we look at Appendix I to the Income-tax Rules, prescribin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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