TMI Blog2022 (7) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that assessing officer had lost sight of this vital aspect. It is not in dispute that WIL has admitted the transaction. It has not claimed depreciation for the year ending 31.03.2006. The Managing Director of the assessee company has not been questioned. Thus the ITAT, based on records, having recorded a finding of fact that the transaction had taken place in March 2006; and the assessee having offered the income generated from the WEGs between 15.03.2006 ending on 31.03.2006 to tax, in our considered view, the first substantial question raised by the revenue needs to be answered in favour of the assessee. Benefit of set off of brought forward losses - as per AO undertaking taken over, MOL was not a 'going concern' th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was eligible for depreciation on the WEGs for the year ending 31.03.2006 without appreciating the findings of the Commissioner of Income Tax (Appeals) that the contradictory statements made by the accountant and the project consultant goes to the root of the factual matrix and the documentary evidences in the form of the report of the Statutory Auditor, the letter from WIL,. the Asset Management Agreement, the meeting of the Board of Directors of WIL and IEL are in contradiction to the claim of the assessee which proves that the sale transaction would not have happened in March 2006? 2. Whether, on the facts and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 99 and it was not a going concern. 4. The CIT (Appeals) (Commissioner of Income Tax) vide order dated 04.11.2011 has dismissed assessee's appeal. Further, the ITAT (Income Tax Appellate Tribunal) vide order dated 22.11.2013 has allowed assessee s appeal for the A.Y.5 2006-07 and partly allowed assessee s appeal for A.Y. 2007-08. Hence this appeal by the Revenue. 5. Shri. Aravind, learned standing counsel for the revenue submitted that: Assessee has claimed that it has purchased 37 wind-mills from IEL on 15.03.2006 and 24.03.2006. Survey was conducted on 28.03.2006. No invoices were made available by the executives of the assessee company. In his statement, one of the executives has stated that he was ignorant of any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an unit were to be fully functional and making profits, the same would not be demerged. Only such units which become non functional or suffer losses are demerged. In substance, he argued that Revenue has misconstrued sub-clause (vi) of Section 2(19AA) to mean as a running unit. 8. We have carefully considered rival contentions and perused the records. 9. The first question of law is whether assessee was eligible for depreciation for the year ending 31.03.2006. Revenue s case is that the transaction has not taken place in March because no documents such as bills or invoices were produced during survey conducted on 28.03.2006. 10. ITAT has recorded a finding of fact in para 7.4 of its order that WIL has sold 28 WEGs to IEL under inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at assessing officer had lost sight of this vital aspect. 13. It is not in dispute that WIL has admitted the transaction. It has not claimed depreciation for the year ending 31.03.2006. The Managing Director of the assessee company has not been questioned. 14. Thus the ITAT, based on records, having recorded a finding of fact that the transaction had taken place in March 2006; and the assessee having offered the income generated from the WEGs between 15.03.2006 ending on 31.03.2006 to tax, in our considered view, the first substantial question raised by the revenue needs to be answered in favour of the assessee. 15. The second question raised by the revenue is with regard to the benefit of set off of brought forward losses . Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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