TMI Blog2018 (5) TMI 430X X X X Extracts X X X X X X X X Extracts X X X X ..... h they were sold to the assessee company - Held that:- The sale price at which the seller had transferred these wind turbines to the assessee company was in fact paid by the assessee company to the seller company in the subsequent assessment year and the same had duly been reflected in the return of income of the seller company. Thus, we are of the considered opinion that in view of these evidences both the lower authorities were patently incorrect in disallowing the assessee’s claim of depreciation in respect of the wind turbines. Accordingly, we deem it fit to hold that the benefit of depreciation on wind turbines should be allowed to the assessee and we order accordingly by setting aside the order of the CIT (Appeals) and direct the AO to allow the benefit of depreciation on wind turbines to the assessee company. - ITA No. 4992/Del/2014 - - - Dated:- 3-5-2018 - SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER For The Appellant : Shri Ved Jain, Adv. Shri Ashish Goel, CA For The Respondent : Shri Atiq Ahmed, Sr. DR ORDER PER SUDHANSHU SRIVASTAVA, J.M.: This appeal has been filed by the assessee against order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee approached the Ld. first appellate authority who upheld the findings of the assessing officer. Now, the assessee is before the Income Tax Appellate Tribunal and has challenged the action of the Ld. CIT (Appeals) in confirming the disallowance in respect of depreciation on wind turbines as well as disallowance under section 14A of the Act. 3. At the outset, Ld. authorised representative submitted that, on instructions of the client, ground No. 3 challenging confirmation of disallowance under section 14A was not being pressed due to smallness of amount. Accordingly, this ground is dismissed as not pressed. 3.1 The Ld. authorised representative submitted that the Ld. first appellate authority had erred on facts as well as in law in confirming the action of the assessing officer in disallowing the impugned amount of rupees 28,47,027/- on account of depreciation on wind turbines. It was submitted that the lower authorities had arbitrarily rejected the explanation/s and the evidences brought on record by the assessee in support of the assessee s claim. 3.2 The Ld. authorised representative submitted that the two wind turbines were purchased from M/s JPT Securities Ltd w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from page 60 of the paper book. It was submitted that this fact has neither been disputed by the assessing officer nor the Ld. CIT (Appeals). 3.5 The Ld. authorised representative also submitted that the allegation of the assessing officer that the purchase of assets/wind turbines was a sham transaction was incorrect as the assessing officer as well as the Ld. CIT (Appeals) had disallowed only the depreciation claimed by the assessee but had accepted the purchase value. It was further submitted that a similar disallowance made in the subsequent assessment year was deleted. It was also submitted that it is undisputed that in this case the receipts had been assessed in the hands of the seller and the same was not doubted and, therefore, the transaction cannot be regarded as sham and non-genuine. 3.6 It was further submitted that the allegation of the Department that the wind turbines had been valued at a higher rate was also incorrect as the assessee had got both the wind turbines valued from M/s United Engineers which was on record. It was also submitted that the assessee had sold these wind turbines at a consideration which was more than the purchase price in the subsequent y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed but the assessee will be entitled to claim depreciation. The Hon ble Delhi High Court in the case of CIT versus Bhushan Steel and Strips Ltd reported in 390 ITR 485 (Delhi) has laid down the ratio that the intention of the legislature in enacting section 32 of the Act would be best fulfilled by allowing depreciation in respect of depreciation to the person in whom the dominion vests for the time being and who is entitled to use the asset in its own right and is using the same for the purposes of its business or profession. Although, the Department has taken a contrary view, we are of the considered opinion that the assessee company became the owner of the wind turbines by virtue of agreement entered into with M/s JPT securities Ltd during the year under consideration. There is also a copy of possession certificate dated 26/03/2008 issued by M/s JPT securities in favour of the assessee and the same is on record and remains undisputed. There is also a certificate issued by the engineers in respect of power generated between 27/03/2008 and 31/03/2008 which is a proof of the asset having been put to use during the year under consideration. The lower authorities have not brought any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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