ACIT, UDAIPUR v. M/s. Rajdarshan Hotels Pvt. Ltd., UDAIPUR

ITA 35/JODH/2014 | 2009-2010
Pronouncement Date: 11-04-2014 | Result: Dismissed

Appeal Details

RSA Number 3523314 RSA 2014
Assessee PAN AAACR7049F
Bench Jodhpur
Appeal Number ITA 35/JODH/2014
Duration Of Justice 3 month(s) 1 day(s)
Appellant ACIT, UDAIPUR
Respondent M/s. Rajdarshan Hotels Pvt. Ltd., UDAIPUR
Appeal Type Income Tax Appeal
Pronouncement Date 11-04-2014
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 10-04-2014
Assessment Year 2009-2010
Appeal Filed On 09-01-2014
Judgment Text
IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA JUDICIAL MEMBER AND SHRI N.K. SAINI ACCOUNTANT MEMBER. ITA NO. 35/JODH/2014 (A.Y. 2009-10) ACIT CIRCLE-1 VS. M/S. RAJDA RSAN HOTELS PVT. LTD. UDAIPUR. PANNA DHAI MARG UDAIPUR. PAN NO. AAACR 7049 F (APPELLANT) (RESPONDENT) ASSESSEE BY : NIL DEPARTMENT BY : SHRI N.A. JOSHI - D.R. DATE OF HEARING : 10/04/2014. DATE OF PRONOUNCEMENT : 10/04/2014. O R D E R PER N.K. SAINI A.M THIS IS AN APPEAL BY THE DEPARTMENT AGAINST THE OR DER DATED 08/10/2013 OF LD. CIT(A) UDAIPUR. THE FOLLOWING G ROUNDS HAVE BEEN RAISED IN THIS APPEAL:- ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE THE LD. CIT(A) HAS ERRED IN:- 1. DELETING THE TOTAL DISALLOWANCE OF HIGHER DEPREC IATION OF RS. 27 38 244/- CLAIMED ON VARIOUS ITEMS WHICH ARE NOT AT ALL PARTS OF THE WIND MILL IGNORING THE FACT THAT HIGHER RATE OF DE PRECIATION IS AVAILABLE TO RENEBLE ENERGY DEVICES BEING WIND MIL L AS ENVISAGED IN 2 ITEM NO. (XII) OF S. NO. 3 OF NEW APPENDIX 1 (I.E. DEPRECIATION TABLE) AND NOT TO THE EXTRA OR ANCILLARY ITEMS. 1.1 IGNORING THE FACT THAT FOUNDATION WORK & TRANSF ORMER PLINTH IS BASICALLY CIVIL WORK AND IS NOT AT ALL PART OF WIND MILL AND THUS ELIGIBLE FOR DEPRECIATION @ 10% INSTEAD OF 80%. 1.2 IGNORING THE FACT THAT PURCHASE AND INSTALLATIO N OF ELECTRICAL ITEMS AND ELECTRIC LINES ARE NOT AT ALL PART OF WIND MILL AND IS THUS ELIGIBLE FOR DEPRECIATION @ 15% INSTEAD OF 80%. 2 DURING THE COURSE OF HEARING NOBODY WAS PRESENT O N BEHALF OF THE ASSESSEE WE THEREFORE PROCEEDED TO DECIDE THE APP EAL EX-PARTE QUA THE ASSESSEE AFTER HEARING LEARNED D.R. ON MERIT. 3. THE ONLY GRIEVANCE OF THE DEPARTMENT IN THIS APPE AL RELATES TO THE DELETION OF DISALLOWANCE AMOUNTING TO RS. 27 38 244 /- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF HIGHER DEPRECIATIO N. 4. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSI NG OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS NOTICED THAT THE ASSESSEE HAD CLAIMED DEPRECIATION ON WINDMILL IN RESPECT OF CIVIL WORK A ND FOUNDATION ELECTRICAL ITEMS COMPONENT AND THEIR INSTALLATION WHEREAS DEPRECIATION @ 10% AND @ 5% ON CIVIL WORK AND FOUNDATION AND @ 1 5% AND @ 7% ON ELECTRICAL ITEMS COMPONENT AND INSTALLATION WAS ALL OWABLE. HE WAS OF THE 3 VIEW THAT NO DEPRECIATION WAS ALLOWABLE ON LEASE LA ND. THE ASSESSING OFFICER ALSO NOTICED THAT THE ASSESSEE HAD CLAIMED DEPRECIATION @ 80% ON COMMON POWER EVACUATION CHARGES WHICH WAS NOT ALLO WABLE AS THE SAME WAS NOT PART AND PARCEL OF THE WIND MILL. THE ASSE SSING OFFICER REJECTED THE SUBMISSIONS OF THE ASSESSEE AND MADE THE DISALL OWANCE OF DEPRECIATION OF RS. 27 32 024/-. 5. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER T O THE LD. CIT(A) WHO DELETED THE DISALLOWANCE BY OBSERVING IN PARA 2 .4 OF THE IMPUGNED ORDER WHICH READ AS UNDER:- 2.4. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPE LLANT AS WELL AS THE FINDINGS OF THE A.O. GIVEN IN THE ASSESSMENT ORDER ALONGWITH THE MATERIALS /EVIDENCE PLACED ON RECORD. IT IS AN UNDISPUTED FAC T THAT DEPRECIATION ON WINDMILL IS ALLOWABLE @ 80% AND THE APPELLANT HAS C LAIMED THE DEPRECIATION ON WINDMILL @ 80% WHICH INCLUDES THE COST OF CIVIL WORK & FOUNDATION ELECTRICAL ITEMS COMPONENTS & INSTALLATION COMMON POWER EVACUATION CHARGES AND ON COST OF LEASE LAND. HOWEVER THE A.O . ALLOWED DEPRECIATION @ 10% ON CIVIL WORK & FOUNDATION AND 15% ON ELECTR ICAL ITEMS COMPONENTS & INSTALLATION AS AGAINST 80% CLAIMED AND THE BALAN CE CLAIM OF DEPRECIATION WAS DISALLOWED SIMILARLY 80% DEPRECIATION CLAIMED ON COMMON POWER EVACUATION AND LEASE LAND WAS WHOLLY DISALLOWED TRE ATING IT IS NOT AN INTEGRAL PART OF THE WINDMILL. AS PER THE RECORD SIMILAR DISALLOWANCE WAS MADE IN THE EARLIER ASSESSMENT YEARS I.E. IN ASSTT. YEARS 2007-08 AND 2 008-09 AND THE SAME WAS DELETED EXCEPT THE DISALLOWANCE M.ADE ON LEASE LAND BY MY ID. PREDECESSOR VIDE HIS COMMON APPELLATE ORDER NO.145/IT/UDR/09-10 & 223/IT/UDR/10- 11 DATED 21.09.2011. AS THE ISSUE INVOLVED FOR DECI SION DURING THE YEAR UNDER APPEAL IS THE SAME AND THE A.O. HAS NOT BROUG HT ANY MATERIAL/EVIDENCE ON RECORD TO SUGGEST THAT THERE I S CHANGE IN THE FACTS OF 4 THE CASE DURING THE YEAR UNDER APPEAL I DO NOT SEE ANY REASON FOR DEVIATION FROM THE DECISION OF MY ID. PREDECESSOR IN THE CASE OF THE APPELLANT MENTIONED SUPRA. HOWEVER THE DISALLOWANCE OF DEPRECIATION ON LEAS E LAND MADE BY THE A.O. IS LIABLE TO BE CONFIRMED AS ADMITTEDLY THE L AND IS NOT DEPRECIABLE ASSET AND DISALLOWANCE TO THE EXTENT OF RS. 3 69 600/- (R S. 3 60 000/- FOR THE ASSTT. YEAR 2009-10 AND RS.9 600/- FOR EARLIER ASST T. YEAR) IS CONFORMED. IN VIEW OF ABOVE DISCUSSION THE DISALLOWANCE MADE OUT OF DEPRECIATION CLAIMED ON WIND MILL INSTALLED DURING THE YEAR UNDE R APPEAL AND CARRIED FORWARD DEPRECIATION OF WINDMILL INSTALLED DURING T HE PREVIOUS ASSESSMENT YEAR ON ACCOUNT OF CIVIL WORK &FOUNDATION ELECTRIC AL ITEMS COMPONENTS AND INSTALLATION COMMON POWER EVACUATION AMOUNTING TO RS. 27 38 244/- (RS. 31 07 844 3 69 600) IS LIABLE TO BE DELETED AND I ORDER ACCORDINGLY. NOW THE DEPARTMENT IS IN APPEAL. 6 . WE HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNED D.R. AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IT IS NOTICED THAT THIS ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE DEPARTMENT VIDE OUR EARLIER ORDER DATED 27/03/2014 IN THE CASE OF ACIT BARMER VS. SHRI LAL CHAND CHOUDHARY JAISALMER IN I.T.A.NO. 527/JODH/2013 FOR THE A.Y. 2009-10 WHEREIN RELEVANT FINDINGS HAVE BEEN GI VEN AT PARA 14 WHICH READ AS UNDER:- 14. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES IT IS NOTICED THAT THE PRESENT ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE VIDE AFORESAID REFERRED TO ORDER DATED 20/11/2013 IN TH E CASE OF ACIT UDAIPUR VS. M/S. K.K. ENTERPRISES WHEREIN THE RELEV ANT FINDINGS HAVE BEEN GIVEN IN PARA 19 WHICH READ AS UNDER:- 5 19. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTI ES AND THE MATERIAL AVAILABLE ON THE RECORD IT IS NOTICED THAT AN IDENTICAL ISSUE HAVING SIMILAR FACTS HAS ALREADY BE EN ADJUDICATED BY THIS BENCH OF THE TRIBUNAL IN ASSESS EES OWN CASE FOR THE A.Y. 2007-08 IN I.T.A.NO. 438/JU/2010 VIDE ORDER DATED 20/09/2012 WHEREIN THE RELEVANT FINDINGS HAV E BEEN GIVEN IN PARA 24 WHICH READS AS UNDER:- 24. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND MATERIAL AVAILABLE ON RECORD WE ARE OF THE OPI NION THAT THE LD CIT(A) HAS PASSED A JUST ORDER WHICH I S IN CONSONANCE WITH THE EARLIER ORDER OF THIS BENCH OF THE TRIBUNAL IN THE CASE OF DCIT BHILWARA VS M/S SARVO DAYA SUITINGS PVT LTD BHILWARA (SUPRA). IN THE INSTANT CASE IT IS NOT IN DISPUTE THAT THE ASSESSEE INSTALLED A WINDMI LL. FOR INSTALLING A WINDMILL CIVIL WORK & FOUNDATION WAS DONE BY INCURRING AN EXPENDITURE OF RS. 34 60 760/- WITHOU T DOING THE CIVIL CONSTRUCTION WORK INCLUDING FOUNDA TION WORK IT WAS NOT POSSIBLE TO INSTALL THE WINDMILL. SIMILARLY THE ELECTRIC ITEMS COMPONENT AND INSTALLATION WERE NECESSARY FOR THE WINDMILL BECAUSE IN THE ABSENCE OF THESE COMPONENTS AND ELECTRIC ITEMS IT WAS NOT POSS IBLE FOR THE WINDMILL TO PRODUCE ELECTRICITY. THEREFORE IT WAS ALSO AN INTEGRAL PART OF THE WINDMILL. IN THE INST ANT CASE THE ASSESSEE PAID A SUM OF RS. 31 25 000/- TO M/S S UZLON ENERGY LTD THROUGH WHOM THE WINDMILL WAS INSTALLED. THE SAID PAYMENT WAS NON-REFUNDABLE. THE SAID EXPENDITU RE WAS MADE FOR THE INSTALLATION OF THE WINDMILL AND I F THERE WAS NO SUCH WINDMILL INSTALLATION THE ASSESSEE COU LD NOT HAVE INCURRED SUCH EXPENSES THEREFORE EXPENDITUR E INCURRED ON COMMON POWER EVACUATION WAS DIRECTLY RELATED TO THE WINDMILL AND THE ASSESSEE WAS ENTITL ED FOR HIGHER DEPRECIATION. WE THEREFORE CONSIDERING TH E TOTALITY OF FACTS DO NOT SEE ANY INFIRMITY IN THE O RDER OF LD CIT(A) ON THIS ISSUE. 6 7 . SINCE THE FACTS OF THE PRESENT CASE ARE SIMILAR T O THE FACTS INVOLVED IN THE AFORESAID REFERRED TO CASE OF ACIT BARMER VS. SHRI LAL CHAND CHOUDHARY JAISALMER IN I.T.A.NO. 527/JODH/2013 FOR THE A.Y. 2009-10 SO RESPECTFULLY FOLLOWING THE SAID ORDER DATED 27/0 3/2014 WE DO NOT SEE ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. 8 . IN THE RESULT APPEAL OF THE DEPARTMENT IS DISMIS SED. (ORDER PRONOUNCED IN THE COURT ON 10 TH APRIL 2014). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 10 TH APRIL 2014. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR ITAT JODHPUR.