Income Tax Appellate Tribunal - Mumbai
Acit 27(3), Navi Mumbai vs Vijayee Industrial Manufacturing Co, ... on 2 February, 2017
आयकर अपीऱीय अधिकरण, मुंबई न्यायपीठ "जे" मुंबई IN THE INCOME TAX APPELLATE TRIBUNAL "J" BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JM AND SHRI RAJESH KUMAR, AM आमकय अऩीर सं./I.T.A. 3823/Mum/2015 (ननधधायण वषा / Assessment Year: 2010-11) Asst.Commissioner of Income Tax M/s Vijayee Industrial
-27(3), Manufacturing Co.11, th 4 floor, फनधभ/ Satyam 318, Vashi Railway Station Complex, Vs. Linking road, Vashi, Khar (W), Navi Mumbai-400703 Mumbai-400052 स्थधमी रेखध सं ./ जीआइआय सं ./ PAN : AAAFV0701F (अऩीरधथी /Applicant) : (प्रत्मथी / Respondent) अऩीरधथी की ओय से / Applicant by : Shri T A Khan प्रत्मथी की ओय से/Respondent by : Shri Jitendra Singh and Ms.Neha Paranjape सुनवधई की तधयीख /Date of Hearing : 25.1.2017 घोषणध की तधयीख /Date of : 2.2.2017 Pronouncement आदे श / O R D E R PER RAJESH KUMAR, A. M:
This is an appeal filed by the revenue challenging the order dated 31.3.2015 passed by the ld.CIT(A)-25, Mumbai against deletion of disallowance of depreciation made by the AO in respect of purchase and commissioned of the wind mill in the assessment framed vide order dated 11.03.2013.2
ITA No.3823/Mum2015
2. The only ground raised by the revenue in the ground is against the deletion of disallowance on account of depreciation by ld.CIT(A) as made by the AO of Rs.45,40,769/-.
3. The brief facts of the case are that the assessee filed its return of income on 15.10.2010 declaring total loss of Rs.21,35,037/-. Thereafter the case of the assessee was selected for scrutiny and statutory notices under section 143(2) and 142(1) were issued and served upon the assessee. During the course of assessment proceedings, the AO found that the assessee has purchased a Wind Mill for a consideration of Rs.1,13,51,923/- at Satara, Maharashtra and claimed depreciation of Rs.90,81,538/- at the rate of 20%. According to the assessee put the wind mill was put to commissioning and use on 30.9.2009, whereas as per the AO wind mill was commissioned after 30.9.2009. In order to verify the fact , the AO issued notice under section 133(6) of the Act to the Director Operation of Maharashtra State Distribution Company Limited (MSEDCL) but no reply was received. However, the Superintending Engineer, O&M, Circle, MSEDCL, Satara submitted information vide letter dared 28.2.2013. The AO recorded his observations in para 3.4 of the assessment order and came to the conclusion that the wind mill was commissioned after 30.9.2009 and therefore the assessee was not entitled for full depreciation and accordingly restricted the same to 40% of the cost of purchase. Finally, the AO passed assessment order under section 143(3) dated 11.3.2013 by making various additions including addition on account of the 3 ITA No.3823/Mum2015 wrong claim on depreciation of Rs.45,40,769/- by assessing the income of the assessee at Rs.26,90,200/-. Aggrieved by the order of ld. CIT(A), the assessee preferred and appeal before the ld.CIT(A) who also after considering the submissions of the assessee dismissed the appeal of the assessee as under :
"2.3 I have considered the facts in the instant case, assessment order and the submissions made by appellant carefully. The point in dispute is when the impugned wind mill is said to be put to use by the appellant. As per the AO the said wind mill has commenced production only in October 2009 whereas appellant stated that it started on30.09.2009. It is to be noted that MSEDCL vide its certificate dated 08.1 10.2009 had confirmed commissioning of the machine on 30.09.2009 in the presence of Executive Engineer, testing Division, Satara and Executive Engineer, Valuj. The said certificate is issued by Government agency and there cannot be any ground to doubt the correctness and completeness of the said certificate in the absence of any cogent material brought on record by AO proving otherwise. Even the first credit report certified by the .Junior Manager, Wind Mill, STRC covers the period from 30.09.2009 to 03.11.2009. Further clearance for commissioning was also granted by MEDA, yet another Government agency on 29.09.2009 itself.
2.4 On the basis of factual certifications by various independent government agencies as stated above, I incline to agree with the date of commencement of production of electricity as 30.09.2009. As the impugned wind mill was put to use for more than 180 days in given financial year, assessee is entitled to claim full depreciation @ 80% of its original cost as against restricted depreciation @ 40% allowed by AO. This ground of appeals is allowed."
4. We have carefully considered the rival contentions and perused the material placed before this Tribunal including the orders of authorities below. The ld. AR vehemently submitted before us that both the authorities below have not appreciated the facts available on record which corroborated the fact of wind mill having been commissioned on 4 ITA No.3823/Mum2015 30.9.2009. The ld.Counsel for the assessee while referring to letter No.SE/STRC/TWM/No 12444 dated 8.10.2009 issued by MSEDCL Circle, Satara submitted that the date of commission was 30.9.2009. The ld. Counsel also drew our attention to letter No.SE/STRC/Acctt/ WM/03866 dated 28.2.2013 issued by MSEDCL circle-Satara address to DCIT in response to notice issued under section 133(6), wherein the date of commissioning was clearly mentioned as 30.9.2009 which for the sake of ready reference is extracted below:
"Maharashtra State Elect. Dist.Co.Ltd. Satara Circle Administrative Bldg.Krishna-nagar,Satara-415003 MAHAVITARAN 244640(0) 2460 15(P) Fax (02162) 245541 E-mail [email protected] Website www.mahadiscom.in
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Ref. SE/STRC/Acctt/WM/03866 Date: 28 Feb 2013 To, The Deputy Commissioner of Income Tax-22(2), 4th floor, Tower No.6, Washi Railway Station Bldg. Complex, Vashi, New Mumbai - 400703.
TeI.No.022-27812229 Sub:- Information in r/o M/s Vijay Industrial Manufacturing Company under IT Act 1961.
Ref:- Chief Engineer (Comm) Mumbai's L.No. Comm/CP/ Wind/05077, dt. 15.02.2013.
Sir, The information as desired u/s 133(6) of Income Tax Act, 1961 in r/o Mls Vijayee Industrial Manufacturing Company, 11, Satyam, 318, Linking Road, Khar (W), Mumbai as under.
S.No. S.No.of the Location Gat Village Capacity of Date of the machine No. the machine commissioning of machine 1 19535 J 30 209 Bhosare, 1 x 225 KW 30.9.2009 Tal.Khatav, Dist.Satara 5 ITA No.3823/Mum2015 The above machine was commissioned on 30.09.2009 as per the clearance for commissioning from MEDA vide L.No.5119 dt.29.9.2009 and permission from Electrical Inspector dt. 30.09.2009. The letters in this respect is enclosed. Energy purchase agreement was carried out at Corporate Office for above machine on 25.11.2009 in the presence of Director (Operation) and representative from Vijayee Industrial Manufacturing Co for the span of 13 years from the date of commissioning.
The first credit report was prepared for the period of 30.09.2009 to 03.11,2009 and regularly the developers representative collects the credit reports and submits the invoice for sale of his energy to MSEDCL. Accordingly, amount is released, The xerox copy of amount paid against invoices and credit reports is enclosed herewith for your ready reference, Thanking you, Yours faithfully, sd (Prabhakar S.Nirmale) Superintending Engineer (STRC),Satara Copy S.w.rs.to :-
1) The Director (Operations) MSEDCL. Corporate Office, Mumbai
2) The Executive Director (Comm) MSEDCL. Corporate Office, Mumbai
3) The Chief Engineer (Comm) MSEDCL. Corporate Office.Mumbai Copy to :-
The Asstt,Manager (F&A) MSEDCL. Circle Office, Satara Finally, the ld.AR drew our attention to the details of billing which started from September, 1999. Finally the ld.AR filed before the Tribunal copies joint meter reading ((Energy Injection Report) duly signed by the AE, MSEDCL, sub-division Aundh and T S Wind Power Developer which is extracted below:-
6
ITA No.3823/Mum2015
Billing Details
Meter Type Account Meter read Billing Period
0004934107 S+ SIGNET 30.9.200918:08:13 Current
KYA Q1 KYA Q3
Maximum Time Stamp Cumulative Maximum Time Stamp Cumulative
Demand Demand Demand Demand
A 0.0300 23/09/2009 00:26 0.4800 0.0100 24/09/2009 05:57 0.0500
B 0.0400 24/09/2009 16:25 0.7000 0.0100 23/09/2009 15:10 0.0700
C 0.0200 29/09/2009 09:27 0.5400 0.0100 24/09/2009 11:55 0.1000
D 0.0400 27/09/2009 20:28 0.5200 0.0000 00/00/0000 00:00 0.0000
0.0400 24/09/2009 16:25 0.0100 24/09/2009 05:57
Rate A Rate B Rate C Rate D Total
kWh delivered 29.338480 33.958735 10.523400 20.306420 94.127035
kVAh Q1 29.492885 34.179135 10.587470 20.347230 94.606720
kVARhQ4 3.586030 3.475400 0.931985 2.128945 10.122360
kVARhQ4 0.714330 0.891035 0.313535 0.251510 2.170410
Avgpf 0.998 0.994 0.994 0.998 0.997
Rate A Rate B Rate C Rate D Total
kWh received 0.111590 0.222900 0.160350 0.039445 0.534285
kVAh Q3 0.202880 0.340000 0.200455 0.062640 0.805975
kVARhQ3 0.139575 0.205790 0.081540 0.038910 0.465815
kVARhQ2 0.078165 0.168510 0.090330 0.028355 0.365360
Avgpf 0.375 0.436 0.395 0.556 0.424
Rate A Rate B Rate C Rate D Total
kWh del+rec 29.450070 34.181635 10.683750 20.345865 94.661320
On perusal of the same, it is apparent that the Wind Mill has been commissioned on 30.9.2009 and therefore the observations of the AO that wind mill was not commissioned/installed on 30.9.2009 was contrary 7 ITA No.3823/Mum2015 to the fact on records. Similarly, the FAA has also failed to appreciate the facts in correct perspective. Under these circumstances, we are not in agreement with findings of ld.CIT(A) as facts on records speak contrary. We are , therefore, inclined to set aside the order of ld.CIT(A) and direct the AO to allow 80% depreciation on wind mill.
5. In the result, the appeal of the assessee stands allowed as indicated above.
Order pronounced in the open court on 2.2.2017.
Sd sd
(Mahavir Singh) (Rajesh Kumar)
न्याययक सदस्य / Judicial Member लेखा सदस्य / Accountant Member
भंफ
ु ई Mumbai; ददनधंक Dated : 2.2.2017
SRL,Sr.PS
आदे श की प्रनतलरपऩ अग्रेपषत/Copy of the Order forwarded to :
1. अऩीरधथी / The Appellant
2. प्रत्मथी / The Respondent
3. आमकय आमुक्त(अऩीर) / The CIT(A)
4. आमकय आमुक्त / CIT - concerned
5. पवबधगीम प्रनतननधध, आमकय अऩीरीम अधधकयण, भुंफई / DR, ITAT, Mumbai
6. गधर्ा पधईर / Guard File आदे शधनस ु धय/ BY ORDER, True copy उऩ/सहधमक ऩंजीकधय (Dy./Asstt. Registrar) आमकय अऩीरीम अधधकयण, भुंफई / ITAT, Mumbai