TMI Blog2015 (4) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... ant is nothing but the bye-product and has got the direct connection with the Industrial undertaking and is therefore, to be considered for the purpose of working out the profit of Industrial undertaking wherei as referred to the unreported decision of Madras High Court in the case of C1T V/s, TANFAC Industries Ltd. Therein the Madras High Court has also held that while working out the profit of Captive power plant, the value of the steam generated and used in the manufacturing process in other unit is to be taken into account. The SLP from the said decision has been dismissed by the Hon'ble Apex Court. In view of this decision, the disallowance cannot be made on the alleged and the imaginary intention of the legislature. If there is any ambiguity in law then only other tools of interpretation such as Finance Minister's speech etc. are to be referred to. Thus allow the deduction u/s. 80IA as claimed by the appellant. As such this ground of appeal is allowed. - I.T. A. No. 1233/AHD/2011 (Assessment Year: 2007-08) - - - Dated:- 10-4-2015 - Shri Shailendra Kr. Yadav, J.M. And Shri Anil Chaturvedi, A.M. Appellant by: Shri Roop Chand, Sr. D.R. Resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 4,11,50,043/- on various assets were disallowed by him. Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who after considering the submissions of the Assessee, the remand report from the A.O and on the assessee s reply to remand report deleted the addition made by the A.O by holding as under:- 2.6 I have carefully considered the entire facts on record, the findings and remand report of A.O., the submissions of the appellant, applicability of Rule 46A and comments on remand report of the appellant. The Assessee has claimed the depreciation on the additions of Plant machinery and other assets. The addition to the Plant machinery is ₹ 14.17 crores and to the building is ₹ 3.69 crores. The amount of depreciation disallowed on additions to fixed assets works out to ₹ 411.50 lacs which details are as under:- The A.O. took the view that he would grant the depreciation on the value in respect of which invoices are produced. Thus he disallowed the depreciation as shown below: Item Value on which Dep. Claimed i.e. addition Bills prod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduce the same. The appellant has contended that show cause notice calling for various details including bills of additions to fixed assets exceeding ₹ 1.00 lac was issued by the A.O only on 16/11/2009 which was received after 2-3 days by the assessee in normal course. It is reiterated that the assessee was required to file many other details also and the time available was only 30 days. It was not possible for the assessee to file each and every bill as called upon by the A.O., in such short span of time allowed. The Affidavit of the Accountant Mr. Shailesh Kaiaria has been filed and put on the record. 2.6.1 The appellant further contended that the A.O. called for the Bills of items above ₹ 1.00 lakh only. However, at the time of finalizing the assessment, the A.O. has disallowed the depreciation in respect of all the bills irrespective of the bill amount below ₹ 1.00 lac. The appellant has also contended that as the bills above ₹ 1.00 lac were voluminous, it was requested to the A.O. to allow assessee to file the copy of invoices of above ₹ 2.00 lacs. 2.6.2 It was also argued before me, that the A.O. has made the piecemeal disall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the year. In connection with the satisfaction of the user condition, the appellant has stated that in the original assessment order there is no finding of the A.O that the machinery was not put to use during the year. The disallowance of depreciation is only in respect of machinery components, the invoices of which, were not produced before A.O. Even during the remand Report proceedings no specific show cause notice was issued to the assessee asking whether the machinery Building was put to use or not. The appellant has submitted before me that whatever details were called for were produced before the A.O. to enable her to submit the report. 2.6.6. The appellant also drawn my attention towards the fact that large portion of addition to plant and machinery is in respect of VS Plant. This fact was brought to the notice of the A.O. that VS plant started functioning at Khambhat during the year. The relevant Excise Registers were filed before the A.O. Similarly, another major portion of addition to plant machinery is in respect of Textile 'Auxiliary at Sanand. The production in that plant also started during the current year and the assessee has filed the copy of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statutory allowance and is to be allowed at a correct figure of investment in fixed assets. In view of this, it is necessary to admit the evidence to disposeoff the case, properly. In such cases, in view of Section 250 (5) I have got ample power to collect the necessary material and evidences which are necessary to dispose-off the case. I find that evidences now being produced are very much essential to dispose-off the case and to reach at the conclusion in effective manner. I therefore, admit the additional evidence produced during appellant proceedings. The reliance placed by the appellant on the case of Pari Mangaldas Ratilal rendered by Hon'ble Gujarat High Court 1977 CTR 647 Guj. and the recent unreported decision of Ahmedabad I.T.A.T. in the case of M/s. Trisun Commodities Ltd. is very apt in this regard. I also find that the evidence now sought to be produced was not withheld willfully. 1 observe that the basic details and many invoices were already filed before A.O during assessment proceedings. Thus the decision of A.C.I.T. V/s. Hiromi Hirose 298 ITR (AT) 269 is also applicable. I have already given the opportunity to the A.O. regarding additional evidence an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On the other hand ld. A.R. reiterated the submissions made before ld. CIT(A) and supported his order. 8. We have heard the rival submissions and perused the material on record. We find that ld. CIT(A) for the reasons spelt out on the order and after relying on the decisions cited, admitted additional evidence under Rule 46A. Before us, ld. D.R. could not point out the illegality in admission of additional evidence by him. We further find that ld. CIT(A) after considering the submissions of the Assessee and other material on record has deleted his additions by a well reasoned and detailed order. Before us, Revenue has not brought any material on record to controvert the findings of ld. CIT(A). In view of the aforesaid facts, we find no reason to interfere with the order of ld. CIT(A) and thus the grounds of Revenue are dismissed. Ground No. 3 is with respect to deletion of disallowance made u/s. 40A(2)(b). 9. During the course of assessment proceedings, A.O noticed that Assessee had paid ₹ 15,01,470/- to Jay Infra Trade Pvt. Ltd., a sister concern. A.O noted that Assessee has not given any justification and reasonableness of the payment made by i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by CIT(A) and order of ld. CIT(A) was also confirmed by Hon ble Tribunal. Before us, Revenue has not brought any material on record to controvert the findings of ld. CIT(A) nor has brought any distinguishing feature of the case for the year under consideration with that of earlier years. We therefore find no reason to interfere with the order of ld. CIT(A) and thus this ground of Revenue is dismissed. Ground No. 4 is with respect to deletion of disallowance of claim u/s. 80IA of the Act. 13. During the course of assessment proceedings, A.O noticed that Assessee has claimed deduction of ₹ 1,56,87,215/- u/s. 80IA of the Act with respect to the generation of power and income from steam. A.O noticed that energy generated from steam has been considered as generation of power. He also noticed that the steam energy was used for captive consumption only and it is not an energy or source of power which was transmittable or can be fed in to the grid. He was therefore of the view that steam cannot be considered as power for the purpose of claiming deduction u/s. 80IA(4) of the Act. He accordingly disallowed the claim of deduction. Aggrieved by the order of A.O., Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ention of the legislature. If there is any ambiguity in law then only other tools of interpretation such as Finance Minister's speech etc. are to be referred to. Respectfully following the decisions of ITAT Benches end also the unreported decisions of Hon'ble Madras High Court referred to in the decision of D.C.W. LTD. (SUPRA) Mumbai Tribunal, I allow the deduction u/s. 80IA as claimed by the appellant. As such this ground of appeal is allowed. 14. Aggrieved by the aforesaid order of ld. CIT(A), Revenue is now in appeal before us. 15. Before us, ld. D.R. supported the order of A.O. On the other hand ld. A.R. reiterated the submissions made before A.O. CIT(A) and further placed reliance on the decision at Mumbai Tribunal in the case of West Coast Paper Mills Ltd. vs. ACIT (2014) 52 Taxman.com 268 (Mum Tribunal) and also placed on record the copy of the aforesaid decision. He thus supported the order of ld. CIT(A). 16. We have heard the rival submissions and perused the material on record. We find that while deciding the issue in favour of the Assessee, ld. CIT(A) had relied on the various decisions including the decision of Madras High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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