TMI Blog2021 (3) TMI 651X X X X Extracts X X X X X X X X Extracts X X X X ..... of parts viz. air ducting, supporting structure, bed coil etc. All these items have been purchased on different dates, namely, first invoice on page no.41 is dated 17.8.2004, but another invoice on page no.47 is dated 23.2.2005. It is not discernible actually how these components have been used, and when they were installed. These are details, which have been furnished in a very casual manner, and have been accepted by the ld.CIT(A) without any proper verification. Therefore, we are of the view that in spite of second round of litigation, the assessee could not produce complete details in support of its claim. The finding of the ld.CIT(A) is not based on correct appreciation of the material facts, rather the ld.CIT(A) has misconstrued partial and incomplete documents available on the record. We do not have any hesitation in setting aside this finding. On analysis of the record, we are of the firm view that assessee failed to prove the installation of high efficiency boiler on which depreciation at the rate of 80% could be claimed. - Decided against assessee. - ITA No.1478/Ahd/2018 (Asstt. Year: 2006-07) - - - Dated:- 28-1-2021 - SHRI RAJPAL YADAV, VICE-PRESIDENT AND SHRI AMA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he revised return of income dated 04/01/2008, it is seen that the assessee has claimed depreciation at 80% on CVL boiler, stem turbine amounting to ₹ 6,71,83,690/-. As per Sr. No. 8(A)(d) of New Appendix-1 of Income-tax Rules, 1962, the depreciation at 80% is allowable to boiler having high efficiency boilers [thermal efficiency higher than 75 per cent in case of coal fired and 80 per cent in case of oil/gas fired boilers]. The assessee failed to furnish any evidence to prove that the boilers on which 80% depreciation claimed is of high efficiency boilers inspite of ample opportunities afforded during the course of set-aside assessment proceedings. When a claim for higher depreciation is made, the assessee has to prove that such plant machinery, in fact, fall within the ambit of Rule-5(l) read with New Appendix-1 of 1. T. Rules. During the course of appellate proceedings as well as in the course of set-aside proceedings the assessee could only produce evidence in respect of filing revised return of income where it made the claim of depreciation at 80%. It failed to produce any evidence to prove that boiler on which 80% depreciation claimed in the revised return is, in fact, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iler purchased by the appellant is BFBC boiler (bubbling fluidized bed combustion) which according to the appellant is specifically mentioned in the Act that depreciation will be allowed @ 80%. The relevant part of the act is as under: Energy saving devices, being A. Specialized boilers and furnaces: (a) Ignifluid/fluidized bed boilers - (b) Flameless furnaces and continuous pusher type furnaces (c) Fluidized bed type heat treatment furnaces (d) High efficiency boilers (thermal efficiency higher than 75 per cent in case of coal fired and per cent in case of oil/gas fired boilers) The Act is specifically Allowing depreciation @ 80% to fluidized bed boilers which has been purchased by the appellant. The details of the boiler purchased are clearly mentioned in the bill. Further, it can be seen from the details submitted that the claim of depreciation has been allowed by the AO in next years and no disallowance has been made in the coming years. It is also submitted that the boiler is being used for the power plant in which depreciation has been allowed (5) 80% by the department in subsequent years. Further, the AO has made the addition by re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived from them. The appellant submitted that notices have been duly served and as the matter is more than 11 years old therefore it might be possible that these parties have destroyed the records as according to /aw only 6 years details are required to be kept. Appellant also staled the AO should have informed the appellant about non receipt of reply from these parties. In its support appellant also filed the balance sheet and memorandum of these parties from the MCA website to support its claim. I therefore find that the appellant has duty submitted valid reason for non receipt of reply as the matter was 11 years old. Further, there is no issue regarding the genuineness of the parties, therefore whether reply is received or not will not hold much importance in this case as the AO has found the bills to be genuine and no disallowance of complete depreciation has been made. The issue is only with regards to the rate of depreciation. Further, the memorandum of these parties also state that these companies are existing and are involved in the manufacturing of boilers and related products, therefore the genuineness of the transaction is in no doubt AO has further stated that certificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the mistake of the AO, rather it is the assessee who failed to collect evidence and submitted before the AO. Certificate of chartered engineer considered by the ld.CIT(A) is dated 24.1.2017 whereas the assessment order was passed on 31.7.2015. This certificate was not produced before the AO, and it could only be placed on the record with the help of Rule 46A of the Income Tax Rules and not in any other manner. The ld.CIT(A) has erred in taking cognizance of the certificate. 6. On the other hand, the ld.cousnel for the assessee relied upon the order of the ld.CIT(A). He submitted that originally revised return was filed well in time, but its cognizance was not taken by the AO. It was a patent error at the end of AO and on the direction from the higher appellate authority, the ld.AO has considered the claim of the assessee, but rejected it. He further contended that Income Tax Rules an appendix is being annexed wherein the rate of depreciation admissible under section 32 of the Act is being provided. The details of specialized boilers and furnace have been categorized under serial no.(a) to (d) as noticed by the ld.CIT(A) on page no.3 of the impugned order. The ld.AO has considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... namely :- (a) where the [Assessing Officer] has refused to admit evidence which ought to have been admitted ; or (b) where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to produce by the [Assessing Officer] ; or (c) where the appellant was prevented by sufficient cause from producing before the [Assessing Officer] any evidence which is relevant to any ground of appeal ; or (d) where the [Assessing Officer] has made the order appealed against without giving sufficient opportunity to the appellant to adduce evidence relevant to any ground of appeal. (2) No evidence shall be admitted under sub-rule (1) unless the [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] records in writing the reasons for its admission. (3) The [Deputy Commissioner (Appeals)] [or, as the case may be, the Commissioner (Appeals)] shall not take into account any evidence produced under sub-rule (1) unless the [Assessing Officer] has been allowed a reasonable opportunity- (a) to examine the evidence or document or to cross-examine the witness produced by the appellant, or (b) to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4/01/2017 Sd/- S.K. Patel. (Chartered Engineer) 11. A perusal of the certificate would indicate that it is dated 24.1.2017 issued after the assessment order. This chartered engineer has no where specified that such BFBC boiler was installed under his supervision or he has inspected the boiler. He simply stated that this concern has installed a boiler but no mention on what basis he observed so; had he ever visited the premises of the assessee ? Therefore, it was necessary for the AO to examine such type of person, but he was not produced before the AO even in the remand proceedings. Other evidences submitted by the assessee are copies of invoices vide which parts of the boilers have been purchased. The ld.AO has issued notice under section 133(6) of the Income Tax Act and directed this person to furnish information, but these were not responded. We have perused these bills, and particularly examined copy of invoice placed at page no.41o the paper book. The date on the bill is not discernible completely. Under the head particulars it reads like this PARTICULARS WEIGHT (KG) AMOUNT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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