Rasiklal M. Dhariwal (HUF), Pune v. Asst. CIT, Central Circle 1(1), Pune

ITA 1197/PUN/2013 | 2009-2010
Pronouncement Date: 28-10-2016 | Result: Partly Allowed

Appeal Details

RSA Number 119724514 RSA 2013
Assessee PAN AABHD5583L
Bench Pune
Appeal Number ITA 1197/PUN/2013
Duration Of Justice 3 year(s) 4 month(s) 30 day(s)
Appellant Rasiklal M. Dhariwal (HUF), Pune
Respondent Asst. CIT, Central Circle 1(1), Pune
Appeal Type Income Tax Appeal
Pronouncement Date 28-10-2016
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted A
Tribunal Order Date 28-10-2016
Date Of Final Hearing 28-07-2016
Next Hearing Date 28-07-2016
Assessment Year 2009-2010
Appeal Filed On 29-05-2013
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE . . ! # $ BEFORE SHRI R.K. PANDA AM AND SHRI VIKAS AWASTHY JM . / ITA NOS.1197 & 1198/PN/2013 #& & / ASSESSMENT YEARS : 2009-10 & 2010-11 RASIKLAL M. DHARIWAL (HUF) MANIKCHAND HOUSE PLOT NO.100-101 D. KENNEDY ROAD PUNE 411001 PAN : AABHD5583L . / APPELLANT V/S ACIT CENTRAL CIRCLE - 1(1) PUNE . / RESPONDENT . / ITA NO.1182/PN/2013 #& & / ASSESSMENT YEAR : 2010-11 ACIT CENTRAL CIRCLE - 1(1) PUNE . / APPELLANT V/S RASIKLAL M. DHARIWAL (HUF) MANIKCHAND HOUSE PLOT NO.100-101 D. KENNEDY ROAD PUNE 411001 PAN : AABHD5583L . / RESPONDENT ASSESSEE BY : SHRI SANJAY N. KAPADIA RESPONDENT BY : SHRI HITENDRA NINAWE / ORDER PER VIKAS AWASTHY JM : THESE SET OF 3 APPEALS 2 BY THE ASSESSEE AND 1 BY THE DEPARTMENT ARE DIRECTED AGAINST THE ORDER OF CIT(A)-II PUNE. I N ITA NO.1197/PN/2013 THE ASSESSEE HAS ASSAILED THE ORDER OF THE CIT(A) / DATE OF HEARING :25.10.2016 / DATE OF PRONOUNCEMENT:28.10.2016 2 ITA NOS.1197 1198 & 1182/PN/2013 DATED 31-01-2013 FOR ASSESSMENT YEAR 2009-10. ITA NO .1198/PN/2013 FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) DATED 31-01-2013 FOR A.Y. 2010-11. THE DEPARTMENT HAS FILED CROSS APPEAL AGAIN ST THE SAID ORDER OF CIT(A) FOR A.Y. 2010-11 IN ITA NO.1182/PN/2013. S INCE SOME OF THE ISSUES INVOLVED IN THE PRESENT SET OF APPEALS ARE C OMMON THESE APPEALS ARE TAKEN UP TOGETHER FOR ADJUDICATION. FOR THE SAKE OF CONVENIENCE THE APPEAL OF THE ASSESSEE IN ITA NO.1197/PN/2013 FOR A.Y. 2009-10 IS TAKEN UP FIRST FOR ADJUDICATION. 2. THE GROUNDS RAISED BY THE ASSESSEE IN APPEAL FOR A.Y. 2009-10 ARE AS UNDER : 1. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(A) HAS ERRED IN SUSTAINING DISALLOWANCE OF RS.7 91 659/- OU T OF VARIOUS EXPENSES U/S.14A OF THE ACT WITHOUT APPRECIATING THE WRITTEN SUBMISSION AND DIRECTLY APPLICABLE JUDICIAL PRONOUNCEMENTS. 2. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD.CIT(A) HAS ERRED IN SUSTAINING ADDITION OF RS.25 60 000/- AS U NEXPLAINED INVESTMENT IN PLOT OF LAND ERRONEOUSLY COMPARING WIT H THE STAMP DUTY VALUATION. 3. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD.CIT(A) HAS ERRED IN MAKING THE IMPUGNED ADDITION IGNORING THE ACTUAL INVESTMENT OF RS.7 00 000/- ALREADY REFLECTED IN THE BOOKS OF AC COUNTS. 4. THE APPELLANT CRAVES LEAVE TO ADD AMEND ALTER SUBSTITUTE MODIFY ANY OR ALL THE ABOVE GROUNDS OF APPEAL IF NECESSARY ON THE BASIS OF SUBMISSIONS TO BE MADE AT THE TIME OF PERSONAL HEARING. 3. SHRI SANJAY N. KAPADIA APPEARING ON BEHALF OF THE ASSES SEE SUBMITTED THAT DURING THE PERIOD RELEVANT TO A.Y. 2009-10 THE ASSESSEE RECEIVED EXEMPT INCOME TO THE TUNE OF RS.50 03 037/- FROM DIVIDEND ON SHARES AND MUTUAL FUNDS AND SHARE OF PROFIT FROM THE PAR TNERSHIP FIRM. THE AO MADE DISALLOWANCE OF RS.7 91 659/- UNDER THE PROVIS IONS OF SECTION 14A R.W. RULE 8D OF THE ACT IN RESPECT OF AFORESA ID TAX FREE INCOME. THE LD. AR CONTENDED THAT THE DIVIDEND INCOME E ARNED BY THE ASSESSEE IS FROM MUTUAL FUNDS. FOR INVESTMENT IN MUTUAL FU NDS NO 3 ITA NOS.1197 1198 & 1182/PN/2013 SEPARATE ADMINISTRATIVE EXPENSES ARE REQUIRED TO BE INCU RRED. AT THE TIME OF INVESTMENT THE MUTUAL FUNDS MANAGER CHARGE ENTRY RATE OF 0.5% TO 2.5% WHICH FORMS PART OF INVESTMENT COST. THE DECISION OF INVESTME NT IS TAKEN BY KARTA OF HUF WHO IS NOT DRAWING ANY SALARY OR COMPENSAT ION FOR MAKING SUCH DECISIONS. FURTHER THE AO HAS ERRED IN H OLDING THAT THE ASSESSEE UTILIZED INTEREST BEARING FUNDS FOR INVESTMENT PURPOSES. ACCORDINGLY THE AO DISALLOWED INTEREST PAID ON BORROWINGS. THE LOANS WERE TAKEN FOR SPECIFIC PURPOSES AND WERE UTILIZED FOR THE SAME. THEREFORE THE INTEREST ON TERM LOANS CANNOT BE CONSIDER ED FOR MAKING DISALLOWANCE U/S.14A OF THE ACT. MOREOVER THE ASSESSEE HAD SUFFICIENT INTEREST FREE FUNDS TO COVER THE INVESTMENTS MADE IN SHA RES OF MUTUAL FUNDS. THE LD. AR FURTHER SUBMITTED THAT COORDINATE BENC H OF THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.1196/PN/2013 FO R A.Y. 2008- 09 DECIDED ON 29-07-2016 HAS DELETED THE DISALLOWANCE MA DE U/S.14A OF THE ACT ON SIMILAR SET OF FACTS. 4. IN RESPECT OF GROUNDS OF APPEAL NO.2 & 3 THE LD. AR S UBMITTED THAT THE AUTHORITIES BELOW HAVE ERRED IN MAKING ADDITION O F RS.25 60 000/- AND RS.7 LAKHS AS UNEXPLAINED INVESTMENT IN P LOT MERELY ON THE BASIS OF ROUGH CALCULATIONS MADE ON THE DR AFT PURCHASE DEED SEIZED DURING THE COURSE OF SEARCH. THE AMOUNTS MENTIONED ON THE DOCUMENT SEIZED IS INFACT CALCULATION OF STAMP DUTY PAYABLE FOR REGISTRATION OF THE DEED. THE ASSESSEE HAD PURCHASED P ROPERTY SITUATED AT SURVEY NO.28 HISSA NO.3/1 PLOT NO.20 TO 28 IN THE YEAR 1996 FOR A CONSIDERATION OF RS.7 LAKHS. HOWEVER AT THAT TIME THE D EED WAS NOT EXECUTED BY THE SELLER IN FAVOUR OF THE ASSESSEE. THE PU RCHASE DEED WAS EXECUTED AND REGISTERED ON 20-08-2008 WHEREAS THE EN TIRE PURCHASE CONSIDERATION WAS PAID BY THE ASSESSEE IN 1996. THE LD. AR REFERRED TO THE RECEIPT FORMING PART OF THE REGISTERED SALE DEED AT P AGE 16 OF THE 4 ITA NOS.1197 1198 & 1182/PN/2013 PAPER BOOK TO SHOW THAT THE AMOUNTS MENTIONED ON THE RECEIPT AGAINST; (A) MARKET VALUE RS.27 20 000/- (B) PURCHASE CONSIDERATION RS.7 LAKHS AND (C) STAMP DUTY PAID RS.1 36 000/- COINCIDES WITH THE VALUES MENTIONED ON THE DRAFT PURCHASE DEED WHICH WAS S EIZED DURING THE SEARCH OPERATIONS. THE LD. AR CONTENDED THAT AMOU NT OF RS.18 60 000/- REPRESENTS CONSIDERATION WHICH MATCHES WITH THE CONSIDERATION SHOWN ON PAGE 4 OF BUNDLE NO.7. THE FIGURES 2375 AND 2300 MENTIONED ON THE SEIZED DOCUMENTS REPRESENTS ARE A OF LAND. THE LD. AR CONTENDED THAT THIS ISSUE CAN BE REMITTED BACK T O THE FILE OF THE AO FOR VERIFICATION OF FACTS. 5. ON THE OTHER HAND SHRI HITENDRA NINAWE REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE FINDINGS OF CIT(A) IN C ONFIRMING THE ADDITIONS U/S.14A AS WELL AS UNEXPLAINED INVESTMENT IN P LOT. THE LD. DR CONTENDED THAT THE EXPLANATION FURNISHED BY THE A SSESSEE IN RESPECT OF THE CALCULATIONS MADE ON THE DOCUMENTS SEIZED DURING SEARCH IS AN AFTERTHOUGHT. THE LD. DR PRAYED FOR DISMISSING THE APPEAL OF THE ASSESSEE. 6. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENT ATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. THE FIRST ISSUE IN APPEAL RELATES TO THE DISALLOWANCE U/S.14A R.W . RULE 8D IN RESPECT OF INTEREST FREE INCOME EARNED BY THE ASSESSEE. WE FIND THAT IDENTICAL ISSUE HAS BEEN DECIDED BY THE COORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE IN ITA NO.1196/PN/2013 FO R A.Y. 2008- 09 DECIDED ON 29-07-2016. THE RELEVANT EXTRACT OF FACTS AND FINDINGS FROM THE ORDER OF TRIBUNAL ARE REPRODUCED HEREUNDER : 28. THE LD. AR OF THE ASSESSEE SUBMITTED THAT DISALLOWAN CE U/S. 14A R.W. RULE 8D HAS BEEN MADE IN THE IMPUGNED ASSESSMENT YEAR O N ACCOUNT OF DISALLOWANCE OF INTEREST EXPENSES RS.19 39 954/- AND O N ACCOUNT OF DISALLOWANCE OF ADMINISTRATIVE EXPENSES RS.14 01 815/-. THUS THE TOTAL 5 ITA NOS.1197 1198 & 1182/PN/2013 DISALLOWANCE MADE U/S. 14A IS RS.33 41 769/-. THE ASSESSEE HAS MADE INVESTMENT IN MUTUAL FUNDS FROM ITS OWN INTEREST FREE F UNDS. THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS HAVING CAPITAL O F RS.193.44 CRORES WHEREAS THE TOTAL INVESTMENT IN SHARES AND MUTU AL FUNDS IS ONLY RS.13.65 CRORES. THE LD. AR SUBMITTED THAT THE TRIBUNA L IN THE CASE OF DESAI & GAIKWAD VS. COMMISSIONER OF INCOME TAX (SUPRA) HAS HEL D THAT WHEN THERE IS NO MATERIAL ON RECORD SHOWING THAT INTEREST P AID BY ASSESSEE WAS ATTRIBUTABLE TO FUNDS BORROWED FOR INVESTMENT NO DISA LLOWANCE IN TERMS OF CLAUSE (II) OF SUBRULE (2) OF RULE 8D SHOULD BE MADE. THE LD. AR FURTHER PLACED RELIANCE ON THE DECISION OF HON'BLE BOMBAY HI GH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. HDFC BANK LIMITED REPOR TED AS 366 ITR 505 (BOM). THE LD. AR SUBMITTED THAT THE INTEREST PAI D BY ASSESSEE DURING THE RELEVANT PERIOD WAS TOWARDS TERM LOAN TAKEN FOR I NSTALLATION OF WINDMILL. THERE IS NOTHING ON RECORD TO SHOW THAT BO RROWED FUNDS WERE DIVERTED FOR MAKING INVESTMENTS. THE LD. AR CONTENDED THAT SO FAR AS DISALLOWANCE TOWAR DS ADMINISTRATIVE EXPENSES IS CONCERNED SUBSTANTIAL INVESTMENT WAS MADE BY THE ASSESSEE IN MUTUAL FUNDS. THE MUTUAL FUND AGENCIES DEDUCT PORTFOL IO MANAGEMENT CHARGES FROM THE INVESTMENT ITSELF AT THE TIME OF PUR CHASE OF UNITS OR REDEMPTION OF UNITS AS THE CASE MAY BE. THEREFORE NO DISALLOWANCE ON ACCOUNT OF ADMINISTRATIVE EXPENSES SHOULD BE MADE. THE LD. AR MADE AN ALTERNATE SUBMISSION THAT IF AT ALL SOME DISALLOWANCE I S TO BE MADE ON ACCOUNT OF ADMINISTRATIVE EXPENSES THE CO-ORDINATE B ENCH OF THE TRIBUNAL IN THE CASE OF DHARIWAL INDUSTRIES LIMITED VS. ACIT (SUP RA) HAS RESTRICTED THE DISALLOWANCE ON ACCOUNT OF ADMINISTRATIVE EXPENSES TO RS.2 LAKHS. SIMILAR DISALLOWANCE MAY BE MADE IN THE CASE OF THE A SSESSEE AS WELL. 29. ON THE OTHER HAND THE LD. DR VEHEMENTLY SUPPORTE D THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) AND PRAYED FOR DI SMISSING THE APPEAL OF ASSESSEE. 30. BOTH SIDES HEARD. THE ONLY ISSUE IN THE APPEAL BY T HE ASSESSEE IS WITH REGARD TO DISALLOWANCE OF RS.33 41 769/- U/S. 14A R.W. RULE 8D. THE LD. AR OF THE ASSESSEE AGITATED THE AFORESAID DISALLOWANCE ON THE G ROUND THAT DISALLOWANCE UNDER RULE 8D CONSIST OF TWO COMPONENTS : I.. DISALLOWANCE ON ACCOUNT OF INTEREST EXPENSES RS.19 39 954/-. II. DISALLOWANCE OF ADMINISTRATIVE EXPENSES RS.14 01 81 5/- TOTAL RS.33 41 769/- IN SO FAR AS THE FIRST COMPONENT OF DISALLOWANCE I.E. I NTEREST EXPENSES THE LD. AR CONTENDED THAT THE ASSESSEE HAS TAKEN TERM LOAN FOR I NSTALLATION AND OPERATION OF WINDMILL AND THE INTEREST BEARING FUNDS FOR WINDMILL WERE NOT DIVERTED FOR MAKING INVESTMENTS IN SHARES AND MUTUAL FU NDS. THE TOTAL INVESTMENTS MADE BY THE ASSESSEE IN SHARES AND MUTUAL FUNDS IS RS.13.65 CRORES WHEREAS THE INTEREST FREE FUNDS AVAILABLE WITH T HE ASSESSEE I.E. CAPITAL OF THE ASSESSEE IS TO THE TUNE OF RS.193.44 CRORES. 31. THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF COM MISSIONER OF INCOME- TAX V. RELIANCE UTILITIES AND POWER LTD. REPORTED A S 313 ITR 340 HAS HELD THAT WHERE THE ASSESSEE IS HAVING SUFFICIENT INTEREST-FREE FUNDS OF ITS OWN TO MEET ITS INVESTMENTS AND AT THE SAME TIME THE ASSESSEE HAD RAISED A LOAN IT CAN BE PRESUMED THAT THE INVESTMENTS WERE FROM THE INT EREST-FREE FUNDS AVAILABLE WITH THE ASSESSEE. THE HON'BLE HIGH COURT IN THE CASE OF CIT VS. 6 ITA NOS.1197 1198 & 1182/PN/2013 HDFC BANK LTD. (SUPRA) HAS FOLLOWED THE DECISION LAID DOWN BY THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOM E-TAX V. RELIANCE UTILITIES AND POWER LTD. (SUPRA). THE REVENUE HAS NOT CONTROVERTED THE ASSERTIONS OF THE ASSESSEE THAT THE ASSESSEE IS HAVING SUFFICIEN T INTEREST FREE FUNDS AVAILABLE TO MATCH THE INVESTMENT IN SHARES AND M UTUAL FUNDS. THUS IN VIEW OF UN-REBUTTED FACTS OF THE CASE AND THE LAW LAID DOWN BY THE HON'BLE JURISDICTIONAL HIGH COURT THE DISALLO WANCE MADE U/S. 14A R.W. RULE 8D ON ACCOUNT OF USE OF INTEREST BEARING FUNDS FO R MAKING INVESTMENT IS DELETED. 32. THE SECOND LIMB OF DISALLOWANCE UNDER RU LE 8D. SINCE THE FACTS IN THE ASSESSMENT YEAR UNDER APPEAL AR E IDENTICAL TO THE FACTS IN THE IMMEDIATELY PRECEDING ASSESSMENT YEA R WE FOLLOW THE ORDER OF THE COORDINATE BENCH AND ALLOW GROUND NO.1 RA ISED IN THE PRESENT APPEAL BY THE ASSESSEE. 7. IN RESPECT OF GROUND NOS. 2 & 3 THE ISSUE RELATES TO ADDITION OF RS.25 60 000/- AND RS.7 00 000/- ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PLOT. THE LD. AR CONTENDED THAT THE AUTHO RITIES BELOW HAVE NOT CONSIDERED THE FACT THAT THE CALCULATIONS MADE ON THE DRAFT PURCHASE DEED SEIZED DURING SEARCH IS INFACT CALCULATION O F STAMP DUTY. THE PLOT WAS PURCHASED BY THE ASSESSEE WAY BACK IN THE YEAR 1 996. THE LD. AR HAS REFERRED TO THE DRAFT PURCHASE DEED AT PAGE S 11 TO 15 OF THE PAPER BOOK AND THE RECEIPT ISSUED AT THE TIME OF REGIST RATION OF THE PURCHASE DEED AT PAGE 16 OF THE PAPER BOOK. IT HAS BE EN CONTENDED THAT FIGURES SCRIBBLED ON THE DRAFT PURCHASE DEED SEIZED AT TH E TIME OF SEARCH IS INFACT CALCULATION OF STAMP DUTY PAYABLE. WE FIND THAT SO ME OF THE FIGURES ON DRAFT DEED MATCH WITH THE AMOUNTS MENTIONED O N RECEIPT AT PAGE 16 OF THE PAPER BOOK. THE AR HAS CONTENDED THAT THE PURCHASE CONSIDERATION WAS ACTUALLY PAID IN 1996 HOWEVER WE COULD NOT FIND ANY DOCUMENT ON RECORD TO SUPPORT THIS CONTENTION OF THE A SSESSEE. WE HAVE ALSO NOT BEEN ABLE TO CORRELATE THE ALLEGED CONSIDERATION OF RS.18 60 000/- FROM THE DOCUMENTS PLACED BEFORE US. 7 ITA NOS.1197 1198 & 1182/PN/2013 8. WITHOUT GOING INTO THE MERITS OF THIS ISSUE WE DEEM IT AP PROPRIATE TO REMIT THIS ISSUE BACK TO THE FILE OF AO FOR RECONSIDERAT ION OF THE EXPLANATION FURNISHED BY THE ASSESSEE. THE AO AFTER RE-E XAMINING THE DOCUMENTS SHALL DECIDE THIS ISSUE IN ACCORDANCE WITH LAW. A CCORDINGLY GROUND NOS. 2 & 3 RAISED BY THE ASSESSEE IN THE APPEAL FOR A.Y. 2009-10 ARE ALLOWED FOR STATISTICAL PURPOSES. 9. THE GROUND NO.4 IN THE APPEAL IS GENERAL AND HENCE REQ UIRES NO ADJUDICATION. 10. IN THE RESULT THE APPEAL OF THE ASSESSEE FOR A.Y. 200 9-10 IS PARTLY ACCEPTED IN THE AFORESAID TERMS. ITA NO.1198/PN/2013 : 11. IN APPEAL FOR A.Y. 2010-11 THE ASSESSEE HAS ASSAILED T HE FINDINGS OF CIT(A) BY RAISING FOLLOWING GROUNDS : 1. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(A) HAS ERRED IN SUSTAINING DISALLOWANCE OF RS.13 52 366/- O UT OF VARIOUS EXPENSES U/S.14A OF THE ACT WITHOUT APPRECIATING THE WRITTEN SUBMISSION AND DIRECTLY APPLICABLE JUDICIAL PRONOUNCEMENTS. 2. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD.CIT(A) HAS ERRED IN SUSTAINING ADDITION OF RS.22 70 000/- MADE BY LEARNED AO ON ACCOUNT OF UNEXPLAINED CASH VOUCHERS WITHOUT APPRECIA TING THE FACTS THAT : THE CASH VOUCHERS WERE PREPARED BY THE CASHIER FOR THE APPROVAL OF KARTA OF HUF WERE UNDATED AND WERE NEV ER ACTED UPON FOR WANT OF APPROVAL. THE CASHIER IS HANDLING CASH OF OTHER GROUP CONCERNS AL SO AND TOTAL CASH HANDLED BY THE CASHIER WAS RS.25.67 LACS AND THUS THE TOTAL CASH OF RS.22.70 WAS DULY EXPLAINED BY THE APPELLANT DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3. THE APPELLANT CRAVES LEAVE TO ADD AMEND ALTER SUBSTITUTE MODIFY ANY OR ALL THE ABOVE GROUNDS OF APPEAL IF NECESSARY ON THE BASIS OF SUBMISSIONS TO BE MADE AT THE TIME OF PERSONAL HEARING. 8 ITA NOS.1197 1198 & 1182/PN/2013 12. THE FIRST GROUND RAISED BY THE ASSESSEE IS WITH RESPE CT TO DISALLOWANCE U/S.14A. THE ASSESSEE DURING THE PERIOD RELEV ANT TO A.Y. 2010-11 HAS EARNED INCOME OF RS.1 16 43 867/- EXEMPT FROM TAX. THE AO MADE DISALLOWANCE OF RS.13 52 366/- U/S.14A R.W. RULE 8D. THIS ISSUE HAS ALREADY BEEN ADJUDICATED BY US IN APPEAL OF THE ASSESSEE FOR A.Y. 2009-10. UNDISPUTEDLY THERE HAS BEEN NO CHANGE IN THE FACTS AND CIRCUMSTANCES IN A.Y. 2010-11. THEREFORE THE REASONS G IVEN BY US IN ALLOWING GROUND OF APPEAL NO.1 RELATING TO DISALLOWANCE U/S.14 A IN A.Y. 2009-10 WOULD MUTATIS MUTANDIS APPLY TO GROUND NO.1 RAISED BY THE ASSESSEE IN A.Y. 2010-11. ACCORDINGLY GROUND NO.1 RAISED IN THE APPEAL FOR A.Y. 2010-11 IS ALLOWED. 13. THE GROUND NO.2 IN THE APPEAL BY THE ASSESSEE RELATE S TO ADDITION OF RS.22 70 000/- ON ACCOUNT OF UNEXPLAINED CASH VOUCHERS. 14. THE LD. AR OF THE ASSESSEE HAS CONTENDED THAT THE STATEMENT OF SHRI NAND KUMAR D. YADAV CLERK WAS RECORDED U/S.132(4) AT THE TIME OF SEARCH ON 21-01-2010. IN HIS STATEMENT SHRI NAND KU MAR D. YADAV HAD CATEGORICALLY STATED THAT THE AMOUNT OF RS.22 70 000/ - WAS RECEIVED BY SHRI A.T. MACHE FROM SHRI ROSHANLAL OSWAL REGION AL MARKETING MANAGER OF M/S. DHARIWAL INDUSTRIES LTD. THE C ASH WAS RECEIVED BUT WAS NOT ENTERED IN THE BOOKS OF ACCOUNT. THE LD. AR FURTHER REFERRED TO THE VOUCHERS AT PAGES 25 TO 31 OF THE PAPER BOOK. THE LD. AR CONTENDED THAT A PERUSAL OF VOUCHERS WOULD S HOW THAT NONE OF THE VOUCHERS ARE DATED AND NAME OF THE RECEIVER IN ALL THE VOUCHE RS IS SHRI A.T. MACHE. THE LD. AR FURTHER CONTENDED THAT APAR T FROM SIGNATURES OF RECEIVER THE VOUCHERS DO NOT BEAR SIGNATU RES OF ANY OTHER PERSON. THE CASHIER WAS YET TO RECEIVE APPROVAL FOR PAY MENTS FROM THE KARTA OF THE HUF SHRI RASIKLAL M. DHARIWAL. THE LD. AR FURTH ER 9 ITA NOS.1197 1198 & 1182/PN/2013 CONTENDED THAT THE AUTHORITIES BELOW HAVE ERRED IN COMI NG TO THE CONCLUSION THAT THE STAND TAKEN BY THE ASSESSEE IS INCO NSISTENT TO THE STATEMENT MADE BY SHRI NAND KUMAR YADAV CLERK. INFACT THE STATEMENT OF SHRI NAND KUMAR YADAV SUPPORTS THE CASE OF THE ASSES SEE. 15. THE LD. DR ON THE OTHER SUBMITTED THAT THE AO IN TH E ASSESSMENT ORDER HAS CATEGORICALLY OBSERVED THAT THE CASH AVAILABL E WITH THE ASSESSEE WAS RS.6 64 575/- ONLY. THE SEIZED VOUCHERS CLE ARLY INDICATE THE NAMES TO WHOM PAYMENTS WERE TO BE MADE. THE VOU CHERS SEIZED ARE IN RESPECT OF CASH DISBURSAL MADE BY ASSESSEE OUTS IDE THE BOOKS. THE LD. DR VEHEMENTLY DEFENDED THE FINDINGS OF CIT(A). 16. BOTH SIDES HEARD. AS PER THE CONTENTIONS OF THE AS SESSEE THE AMOUNT OF RS.22 70 000/- WAS RECEIVED BY CASHIER FROM REGIO NAL MARKETING MANAGER OF DHARIWAL INDUSTRIES LTD. EXCEPT FRO M THE STATEMENT OF SHRI NAND KUMAR YADAV THERE IS NO COGENT EVIDENCE TO SUPPORT THE CONTENTIONS OF ASSESSEE. AS PER THE CONT ENTIONS OF ASSESSEE BEFORE AO THE TOTAL CASH AVAILABLE WAS RS.25 66 771/- AT TH E TIME OF SEARCH. THE BIFURCATION OF THE CASH GIVEN BY THE ASSESSEE IS AS UNDER : DHARIWAL INDUSTRIES LIMITED RS.15 87 868/- DHARIWAL INDUSTRIES LIMITED (F&B) RS. 3 14 328/- RMD (HUF) RS. 6 64 575/- TOTAL RS.25 66 771/- A PERUSAL OF ASSESSMENT ORDER DOES NOT SHOW THE VOLU ME OF CASH FOUND AT THE TIME OF SEARCH. NONE OF THE PARTIES BEFORE U S HAVE EITHER FURNISHED COPY OF PANCHNAMA. IN THE ABSENCE OF VITAL INFORMATION/DOCUMENTS WE ARE OF CONSIDERED OPINION THAT T HE ISSUE NEEDS REVISIT TO THE AO. THE AO SHALL DECIDE THE ISSUE AFR ESH AFTER CONSIDERING THE NECESSARY DOCUMENTS ON RECORD. THE AO SHALL GRANT 10 ITA NOS.1197 1198 & 1182/PN/2013 PROPER OPPORTUNITY OF HEARING TO THE ASSESSEE WHILE RE-E XAMINING THE ISSUE IN ACCORDANCE WITH LAW. ACCORDINGLY GROUND NO.2 IN TH E APPEAL BY ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ITA NO.1182/PN/2013 : 17. NOW WE ADVERT TO THE APPEAL BY THE DEPARTMENT. TH E DEPARTMENT HAS ASSAILED THE FINDINGS OF THE CIT(A) BY RAISING THE SOLITARY ISSUE OF GRANTING ADDITIONAL DEPRECIATION ON WINDMILL. 18. THE GROUND RAISED BY THE DEPARTMENT IN APPEAL READS AS UNDER : 1. THE LD.CIT(A) ERRED IN DECIDING THAT POWER GENE RATION FROM WINDMILL IS MANUFACTURING ACTIVITY. 2. THE LD.CIT(A) ERRED IN DECIDING THAT ASSESSEE CAN CL AIM ADDITIONAL DEPRECIATION ON WINDMILL IF ASSESSEE IS ENGAGED IN MANUF ACTURING ACTIVITIES ALTHOUGH MINDMILL HAS NOT CONNECTION WITH ITS MANUFAC TURING BUSINESS. 3. THE APPELLANT CRAVES LEAVE TO ADD ALTER OR AMEND ANY OR ALL THE GROUNDS OF APPEAL. 19. THE LD. AR AT THE OUTSET SUBMITTED THAT THE ISSUE O F ELIGIBILITY OF ADDITIONAL DEPRECIATION ON WINDMILL HAS ALREADY BEEN DECIDED IN THE CASE OF DHARIWAL INDUSTRIES LTD. IN THE APPEAL FILED BY THE DEPARTMENT IN ITA NO.1410/PN/2013 FOR A.Y. 2010-11. WE FIND THAT THE DEPARTMENT HAD ASSAILED ALLOWABILITY OF ADDITIONAL DEPRECIATION ON WINDMILL TO DHARIWAL INDUSTRIES LTD. ONE OF THE GROUP CONCE RN OF ASSESSEE BY RAISING IDENTICAL GROUNDS. THE TRIBUNAL DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY HOLDING AS UNDER : 179. FACTS OF THE CASE IN BRIEF ARE THAT THE AO DU RING THE COURSE OF ASSESSMENT PROCEEDINGS NOTED THAT THE ASSESSEE DURING THE I MPUGNED ASSESSMENT YEAR HAS INSTALLED 10 WINDMILLS/WIND TURBINE GE NERATORS (WTGS) CONSISTING OF 6 WTGS 2.1 M.W. AND 4 WTGS OF 1.5 M.W. CAPACITY AT JAISALMER RAJASTHAN. THE ASSESSEE HAS CLAIMED ADDITIONA L DEPRECIATION AS PER PROVISIONS OF SECTION 32(1)(IIA) OF THE I.T. ACT. ALL THESE 10 WTGS WERE INSTALLED DURING THE YEAR UNDER CONSIDERATION. THE A O FURTHER NOTED THAT 11 ITA NOS.1197 1198 & 1182/PN/2013 THE ASSESSEE HAS CLAIMED ADDITIONAL DEPRECIATION @10% ON SUCH WINDMILLS SINCE THE ASSETS HAVE BEEN PUT TO USE FOR LESS THAN 180 DA YS AND SUCH CLAIM OF ADDITIONAL DEPRECIATION U/S.32(1)(IIA) AMOUNTS TO RS.9 15 52 187/-. HOWEVER ACCORDING TO THE AO POWER GENERATION ACT IVITY AS SUCH DOES NOT AMOUNT TO MANUFACTURE OF ARTICLE OR THING AS MAND ATED U/S.32(1)(IIA) OF THE I.T. ACT TO MAKE THE ASSESSEE ELIGIBLE FOR CLAIM OF ADDITIONAL DEPRECIATION UNDER THAT SECTION. HE THEREFORE ASKED THE ASSESSEE TO JUSTIFY ITS CLAIM OF ADDITIONAL DEPRECIATION ON WINDMILL SINCE WIND MILL S ARE NOT ENGAGED IN PRODUCTION OF AN ARTICLE OR THING. THE ASSESSEE IN H IS WRITTEN SUBMISSIONS FILED BEFORE THE AO JUSTIFIED IN CLAIMING SUCH ADDITI ONAL DEPRECIATION ON WTGS FOR TWO REASONS I.E. (A) ELECTRICITY PRODUCED BY WAY OF WINDMILL IS ALSO AN ARTICLE OR THING AND (B) ADDITIONAL DEPRECIA TION IS ALLOWABLE TO AN ASSESSEE WHICH IS ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. EVEN OTHERWISE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. 180. HOWEVER THE AO WAS NOT SATISFIED WITH THE EXPLAN ATION GIVEN BY THE ASSESSEE AND HELD THAT PROVISIONS OF SECTION 32(1)(IIA) OF THE ACT ARE NOT APPLICABLE TO THE NEWLY INSTALLED WINDMILLS SINCE THOSE DO NOT FALL IN THE CATEGORY OF MACHINERY OR PLANT FOR THE BUSINESS OF MA NUFACTURING OR PRODUCTION OF ARTICLE OR THING AND SETTING UP OF TH ESE WINDMILLS HAS ABSOLUTELY NO ACTION WITH THE ASSESSEES BUSINESS OF MANUFAC TURE WHICH IN THE INSTANT CASE IS MANUFACTURE OF GUTKHA. THE AO HEL D THAT ASSESSEE DOES NOT HAVE TO PAY ANY EXCISE DUTY ON THE SO CALLED PROD UCTION OF THE ELECTRICITY. HAD IT BEEN A MANUFACTURE OR PRODUCTI ON OF ARTICLE OR THING IT WOULD HAVE BEEN COVERED BY THE PROVISIONS OF THE EXCI SE ACT. RELYING ON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ESCORTS LTD. WHERE THE HONBLE APEX COURT HAS UNDERSCORED THE PHILOSOPHY OF DISCOURAGING DOUBLE BENEFIT THE AO DISALLOWED THE CLAIM OF ADDITIONAL DE PRECIATION ON WINDMILLS AMOUNTING TO RS.9 15 52 187/- 181. BEFORE CIT(A) THE ASSESSEE SUBMITTED THAT THE CLAIM OF ADDITIONAL DEPRECIATION IS ADMISSIBLE IF THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. IT WAS SUBMITTED THAT THE ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURE OF PAN M ASALA AND GUTKHA AND IS ALSO IN THE BUSINESS OF GENERATION OF POWE R WHICH HAS BEEN JUDICIALLY HELD TO BE EQUIVALENT TO MANUFACTURE OF ARTICLE OR THING. RELYING ON VARIOUS DECISIONS IT WAS SUBMITTED THAT IF THE ASSESSEE I S ENGAGED IN THE BUSINESS OF MANUFACTURING ADDITIONAL DEPRECIATION HAS TO BE ALLOWED. 182. BASED ON THE ARGUMENTS ADVANCED BY THE ASSESSEE AND RELYING ON THE DECISIONS OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS. M/S. HITECH ARAI LTD. REPORTED IN 377 ITR 477 THE DECI SION IN THE CASE OF TEXMO PRECISION CASTINGS REPORTED IN 321 ITR 485 AND THE DEC ISION IN THE CASE OF CIT VS. VTM LTD. REPORTED IN 319 ITR 336 AND VARIOUS OTHER DECISIONS THE LD.CIT(A) ALLOWED THE CLAIM OF ADDITIONAL DEPRECIAT ION ON WINDMILLS. 183. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE RE VENUE IS IN APPEAL BEFORE US. 184. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES PERUSED THE ORDERS OF THE AO AND CIT(A) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DECI SIONS CITED BEFORE US. IN THE INSTANT CASE THERE IS NO DISPUTE TO THE F ACT THAT THE ASSESSEE DURING THE IMPUGNED ASSESSMENT YEAR HAS INSTALLED WINDMIL LS WHICH HAS BEEN PUT TO USE FOR A PERIOD OF LESS THAN 180 DAYS. TH E ONLY DISPUTE IS REGARDING ADMISSIBILITY OF ADDITIONAL DEPRECIATION ON SUCH WINDMILLS. IT IS 12 ITA NOS.1197 1198 & 1182/PN/2013 THE CLAIM OF THE ASSESSEE THAT ELECTRICITY PRODUCED BY WAY OF WINDMILL IS ALSO AN ARTICLE OR THING AND THEREFORE ADDITIONAL DEPREC IATION IS ALLOWABLE TO THE ASSESSEE SINCE IT IS ENGAGED IN THE BUSINESS OF MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING. WE FIND THE AO REJECTED THE ABOVE CONTENTION OF THE ASSESSEE AND DISALLOWED THE CLAIM OF ADDITIONAL DEPRECIA TION ON THE GROUND THAT ASSESSEE DOES NOT HAVE TO PAY ANY EXCISE DUTY ON THE SO CALLED PRODUCTION OF THE ELECTRICITY. HAD IT BEEN A MANUF ACTURE OR PRODUCTION OF ARTICLE OR THING IT WOULD HAVE BEEN COVERED BY THE PROVISIONS OF THE EXCISE ACT. THE AO ACCORDINGLY REJECTED THE CLAIM OF ADDI TIONAL DEPRECIATION. WHILE DOING SO HE FURTHER HELD THAT SETTING UP OF TH ESE WINDMILLS HAS ABSOLUTELY NO CONNECTION WITH THE ASSESSEES BUSINESS OF MA NUFACTURE OF GUTKHA. WE FIND THE LD.CIT(A) BASED ON VARIOUS DECISI ONS ALLOWED THE CLAIM OF ADDITIONAL DEPRECIATION ON WIND MILLS. THE RELEV ANT OPERATIVE PORTION OF THE LD.CIT(A) AT PARA 3.4 AND 3.5 OF THE ORDER READ S AS UNDER : 3.4 THE ASSESSING OFFICER HAS NOT DISPUTED THE INSTALLAT ION OF THE NEW PLANT AND MACHINERY IN THE FORM OF WINDMILL . THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF ADDITIONAL DEPRECIATION TO T HE APPELLANT ON THE GROUND THAT THE SAME IS AVAILABLE ON ANY PLANT AND MA CHINERY ACQUIRED OR INSTALLED BY THE ASSESSEE ENGAGED IN THE BUSINESS OF MANUF ACTURE OR PRODUCTION OF ARTICLE OR THING AND THE APPELLANT WA S NOT ENGAGED IN SUCH BUSINESS AND THAT THE WINDMILL IS CLASSIFIED AS RENEWED EN ERGY DEVICE AND IN THE GENERATION OF POWER WHICH IS NOT AN ARTICLE OR T HING. THE APPELLANT HAS BROUGHT TO NOTICE OF THE UNDERSIGNED AND ALSO FILED A COPY OF THE DECISION IN THE CASE OF NTPL VS DCIT CITED SUPRA WHEREIN THE DELHI BENCH OF THE ITAT HAS HELD AS UNDER : 'ON DUE CONSIDERATION OF SETTLED JUDICIAL DECISIONS IT IS IMPLICITLY CLEAR THAT THE SUPREME COURT HAS EXPLAINED THE MEANI NG OF ELECTRICITY THE COURT HAS CONSIDERED THE DEFINITION OF GOODS AS GI VEN IN ARTICLE 366(12) OF THE CONSTITUTION OF INDIA . IT ALSO TOOK INTO CONSIDERATION THE SALES TAX ACT OF THE STATE OF ANDHRA PRADESH AS WELL AS MADHYA PRADESH AND ALSO CONSIDERED THE DICTIONARY ME ANING. THEREAFTER THE COURT HAS OBSERVED THAT GOODS MEANS ALL KIND OF MOVEABLE PROPERTIES. THE TERMS MOVEABLE PROPERTY WHEN CONSIDERED WITH REFERENCE TO GOODS AS DEFINED FOR THE PURPOSE OF SALES-TAX CANNOT BE TAKEN I N A NARROW SENSE AND MERELY BECAUSE ELECTRIC ENERGY IS NOT A TANGIBLE OR CANNOT BE MOVED OR TOUCHED LIKE FOR INSTANCE A PIECE OF WOOD OR A BOOK IT CANNOT CE ASE TO BE MOVEABLE PROPERTY WHEN IT HAS ALL THE ATTRIBUTES OF SU CH PROPERTIES. IT IS CAPABLE OF ABSTRACTION CONSUMPTION AND USE OF WHICH IF DONE DISHONESTLY IS PUNISHABLE UNDER SEC. 39 OF THE INDIAN EL ECTRICITY ACT . IF THERE CAN BE SALES AND PURCHASE OF ELECTRIC ENERGY LIKE ANY MOVEABLE OBJECT THAN THERE WAS NO DIFFICULTY IN HOLD ING THAT ELECTRIC ENERGY WAS INTENDED TO BE COVERED BY THE DEFINITION OF GOODS ; THE EXPRESSION 'ARTICLE THING OR GOODS' ARE NOT DEFIN ED IN THE INCOME-TAX ACT 1961 . THE COMMISSIONER WHILE TREATING THE ELECTRICITY AS NOT AN ARTICLE OR THING HAS NOT MADE R EFERENCE TO ANY PROVISIONS OF THE INCOME-TAX ACT 1961 HE SIMPLY CONST RUED THE MEANING OF ELECTRICITY AS NOT ARTICLE OR THING ON TH E BASIS OF HIS OWN INFERENCE DRAWN FROM THE NATURE OF THIS ITEM BUT IF WE EVALUATE THE CONCLUSION DRAWN BY THE COMMISSIONER IN THE LIGHT OF T HE DECISION OF THE SUPREME COURT GIVEN IN THE CASE OF INDIAN CINE A GENCY CST VS . M . P . ELECTRICITY BOARD AND STATE OF MADHYA PRADESH VS . NTPC THEN IT WOULD SUGGEST THAT ELECTRIC ENERGY HAS ALL TRAPPINGS O F AN ARTICLE OR GOODS. THE PROCESS OF ITS GENERATION IS ALSO AKIN TO MAN UFACTURE OR 13 ITA NOS.1197 1198 & 1182/PN/2013 PRODUCTION OF AN ARTICLE OR THING. I T IS BEING GENERATED IN HUGE PLANTS THOUGH SCIENTIFICALLY ONE MAY SAY IT IS TRANSFORMATION OF ONE SOURCE OF ENERGY INTO THE OTHER . BUT ALL THESE ASPECTS HAVE BEEN CONSIDERED IN THESE THREE JUDGMENTS O F THE SUPREME COURT WHEREIN THE COURT HAS EXPLAINED WHAT IS MANUFACTURE OR PRODUCTION AND W HAT IS ELECTRICITY ; THUS TAKING INTO CONSIDERATION ALL THESE ASPECTS WE ARE OF THE VIEW THAT ADMISSIBIL I TY OF ADDITIONAL DEPRECIATION CANNOT BE DENIED TO T HE ASSESSEE MERELY ON THE GROUND THAT ELECTRICITY IS NOT AN ARTICLE OR THING . THE ORDER OF THE CIT (APPEALS) IS REVERSED TO THIS EXTE NT AND THE DISALLOWANCE I S DELETED. ' 3.4.1 IN THE CASE OF CIT VS HI TECH ARAI LTD SUPRA TH E MADRAS HIGH COURT HAS HELD AS UNDER : ' SEC 32(1 )(IIA) DOES NOT STATE THAT THE SETTING UP A N EW MACHINERY OR A PLANT WHICH WAS ACQUIRED OR INSTALLED UPTO 31 ST MARCH 2002 SHOULD HAVE ANY OPERATIONAL CONNECTIVITY TO THE ARTICLE OR A THING THAT WAS ALREADY BEING MANUFACTURED BY THE ASSESSEE . THEREFORE THE CONTENTION THAT THE SETTING UP OF A WINDMILL HAD NOT HING TO DO WITH THE POWER INDUSTRY NAMELY MANUFACTURE OF OIL SEEDS ET C WAS TOTALLY NOT GERMANE TO THE SPECIFIC PROVISION CONTAINED IN SE C 32(1 )(IIA). IT COULD NOT ALSO BE SAID THAT SETTING UP OF A WINDMILL N OT FALL WITHIN THE EXPRESSION SETTING UP OF A NEW MACHINERY OR A PLANT . HENCE THE ASSESSEE WAS ENTITLED TO ADDITIONAL DEPRECIATION.' THE AFORESAID DECISION OF THE MADRAS HIGH COURT IS SEEN TO HAVE BEEN FOLLOWED BY THE JAIPUR ITAT IN THE CASE OF FASHION SU ITS PVT. LTD VS DCIT IN ITA NO. 142/JOD/2011 DATED 16-12-2011. 3.4.2 IN THE CASE OF ACIT VS M. SATISHKUMAR (2012) 19 1 ITR (TRIB) 646 (CHENNAI) IT WAS HELD THAT THE GENERATION OF ELECTRI CITY IS A MANUFACTURING ACTIVITY . THE ASSESSEE WAS INVOLVED IN THE MANUFACTURING ACTIVITY AND FULFILLED THE CONDITIONS AS LAID DOWN U/S 32(1)(IIA). THE BENCH FURTHER HELD THAT THE GOVT . VIDE FINANCE ACT 2012 HAS AMENDED THE PROVISIONS OF S EC. 32(1)(IIA) TO INCLUDE THE BUSINESS OF GENERATION AND D ISTRIBUTION OF POWER ELIGIBLE FOR BENEFIT U/S 32(1)(IIA) AND THAT ALTHOUG H THE SAID AMENDMENT IS W.E . F. 1-4-2012 IT GIVES IMPETUS TO THE VIEW THAT GENERAT ION OF ELECTRICITY IS A MANUFACTURING PROCESS AND QUALIFIES FOR THE BENEFIT U/ S 32(I)(IIA). THE AFORESAID CASE WAS RELATED TO AN ASSESSEE ENGAGED IN THE B USINESS OF GENERATION OF ELECTRICITY THROUGH WINDMILLS AND CLAI MED 100% DEPRECIATION IN RESPECT OF THE WINDMILL INSTALLED AS PER THE PROVISI ONS OF SEC 32(1) AND ITEM (XIII) OF NEW APPENDIX I READ WITH RULE 5 . 3.4.3 IN THE CASE OF VTM LTD . 319 ITR 336 (MAD) THE ITAT CHENNAI CITED THE CBDT CIRCULAR DATED 03.10 . 2001 VIDE F . NO . 178/28/2001-ITA-I IN THE CONTEXT OF SECT I ON 80IA OF THE ACT . IN ACCORDANCE WITH THIS CIRCULAR THE GENERATION OF POWER BY CAPTIVE POWER PLANT WAS TO BE CONSIDERED FOR DEDUCTION U/S 80IA . THE TRIBUNAL THEREFORE HELD THAT THE DEPARTMENT HAD THEREFORE ACCEPTED THE VIEW THA T SUCH POWER WAS AN 'ARTICLE' OR 'THING' AND HENCE THE CONTENTION OF THE AUTHORITIES BELOW WAS NOT SUSTAINABLE. AS THE ONLY OBJECTION OF THE A . O. WAS REGARDING THE POWER GENERATED BY THE WINDMILL NOT BEING 'ARTICLE' OR 'THING' THE TRIBUNAL ALLOWED THE ASSESSEE'S GROUND IN THAT CASE BASED ON THE BOARD'S CIRCULAR AS WE LL AS THE DECISION OF THE DELHI HIGH COURT IN THE CASE OF CIT VS . DCM SRIRAM CONSOLIDATED LTD . (2009) 176 TAXMAN 49 (DEL . ) ; AND SOME EARLIER DECISIONS OF THE ITAT 14 ITA NOS.1197 1198 & 1182/PN/2013 CHENNAI BENCH . FURTHER THE APPELLANT HAS ALSO CITED THE FACTS OF TH E CASE OF MIS HI TECH ARAI LTD. (SUPRA) IN WHICH ALSO IT WAS HEL D THAT THE APPELLANT WAS ENTITLED FOR CLAIM OF ADDITIONAL DEPRECIATION U/ S 32( )(IIA) IN RESPECT OF WINDMILL UNITS FOR GENERATION OF POWER WHERE THE PO WER GENERATED WAS CAPTIVELY USED FOR ITS UNITS . IN THAT CASE THE A . O. HAD NOT ALLOWED THE CLAIM ON THE GROUND THAT GENERATION OF POWER WAS NOT A BUSI NESS OF THE ASSESSEE AND THE POWER GENERATED THROUGH WINDMILL WAS USED FOR CAPTIVE CONSUMPTION . HOWEVER CIT(APPEALS) HAD ALLOWED THE CLAIM ON THE B ASIS THAT THE ASSESSEE WAS ENGAGED IN 'MANUFACTURE ' AND 'PRODUCTION' OF 'ARTICLE' OR 'THING ' AS REQUIRED BY LAW. THE TRIBUNAL HELD THAT SINCE TH E ASSESSEE WAS GENERATING ELECTRICITY BY WINDMILLS THE CONDITION F OR GRANTING ADDITIONAL DEPRECIATION WAS FULFILLED EVEN IF IT WAS USED FOR CAP TIVE CONSUMPTION. AGAIN THE TRIBUNAL RELIED UPON THE SAME CBDT CIRCULAR AS STA TED ABOVE. THE APPELLANT HAS THUS EMPHASISED THAT THESE TWO WERE DIRECT DECISIONS OF ITAT CHENNAI ON THIS PARTICULAR ISSUE OF ALLOWING ADDITIONA L DEPRECIATION ULS 32(1 )(IIA) WHICH HAVE ALSO BEEN SEPARATELY UPHELD BY THE MADRAS HIGH COURT IN THE CASES CITED ABOVE AND THEREFORE THE APPELLANT ' S CLAIM WAS ACCEPTABLE. 3.5 IN VIEW OF THE FACTS BROUGHT ON RECORD AND THE RATIO OF THE DECISIONS CITED ABOVE IT BECOMES APPARENT THAT THE APPELLANT IS ENTITLED TO THE CLAIM OF ADDITIONAL DEPRECIATION . THUS THE DISALLOWANCE MADE BY THE ASSESSING OFFICER OF RS. 9 15 52 187/- IS DIRECTED TO BE DELETED AND THE GROUND OF APPEAL NO 1 RAISED BY THE APPELLANT IS LIABLE TO BE ALLOWED. 185. SINCE THE LD.CIT(A) WHILE ALLOWING THE CLAIM O F ADDITIONAL DEPRECIATION HAS RELIED ON VARIOUS DECISIONS INCLUDING THE DECISIONS OF HONBLE MADRAS HIGH COURT IN THE CASE OF VTM LTD. (SU PRA) AND M/S. HITECH ARAI LTD. (SUPRA) AND SINCE NOTHING CONTRARY WAS BROU GHT TO OUR NOTICE AGAINST THE ABOVE DECISIONS THEREFORE WE DO NOT FIN D ANY INFIRMITY IN THE ORDER OF THE LD.CIT(A) ALLOWING THE CLAIM OF ADDITI ONAL DEPRECIATION ON WINDMILLS INSTALLED BY THE ASSESSEE DURING THE YEAR. GR OUNDS OF APPEAL NO.1 AND 2 BY THE REVENUE ARE ACCORDINGLY DISMISSED. 20. THE LD. DR HAS NOT BEEN ABLE TO CONTROVERT THE FIND INGS OF THE COORDINATE BENCH OF THE TRIBUNAL. SINCE THE FACTS IN THE PRESENT APPEAL ARE SIMILAR TO THE FACTS IN CASE OF DHARIWAL INDUSTRIES LTD . (SUPRA) THE APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF ANY MERIT. 21. IN THE RESULT ITA NO.1197 & 1198/PN/2013 BY ASSES SEE ARE PARTLY ALLOWED AND ITA NO.1182/PN/2013 BY THE DEPARTME NT IS DISMISSED. ORDER PRONOUNCED ON FRIDAY THE 28 TH DAY OF OCTOBER 2016. SD/- SD/- (R.K. PANDA) (VIKAS AWASTHY) / ACCOUNTANT MEMBER # / JUDICIAL MEMBER / PUNE ; DATED : 28 TH OCTOBER 2016 . SATISH 15 ITA NOS.1197 1198 & 1182/PN/2013 ) *# ! -! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. CIT(A) - II PUNE 4. 5. 6. CIT-II PUNE ' %%& & / DR ITAT B PUNE; + / GUARD FILE. / BY ORDER //TRUE COPY// -. % & / SR. PRIVATE SECRETARY & / ITAT PUNE