The Income Tax Appellate Tribunal (ITAT), Delhi Bench ‘H’, adjudicated on the appeal filed by the DCIT, Circle-4(2), New Delhi against the order passed by the Commissioner of Income Tax (Appeals)-2, New Delhi. The appeal, registered as ITA No. 351/DEL/2021, pertains to the assessment year 2017-18.
Clean Wind Power (Ratlam) Pvt. Ltd., located at 201, 3rd Floor, Okhla Industrial Estate, Power-2, South Delhi, New Delhi-20, filed its return of income for the assessment year 2017-18 on 01.11.2017 declaring a loss of Rs.29,12,64,463/-. The return was subsequently revised on 25.02.2019 declaring a loss of Rs.29,13,29,085/-. The case was selected for scrutiny, and the assessment was framed under Section 143(3) of the Income Tax Act, 1961, determining the loss at Rs.27,39,67,190/-.
The appellant raised the following grounds of appeal:
The case was heard on 04.08.2022, and the order was pronounced on 17.08.2022. The Tribunal, comprising Shri Anil Chaturvedi, Accountant Member, and Shri Narender Kumar Choudhary, Judicial Member, reviewed the submissions and the relevant facts of the case.
The main issue in this appeal was the denial of the claim of additional depreciation by the Assessing Officer (AO) and the subsequent allowance of this claim by the CIT(A). During the assessment proceedings, the AO noticed that the assessee had claimed depreciation on Wind Turbine Generator (WTG) at an enhanced rate of 7.69%, which included items like steel, RMC, and labor charges for E&C of 50 nos. of WTG. The AO believed that the depreciation should be at the prescribed rate of 3.02% and disallowed the excess depreciation amounting to Rs.1,71,04,168/-.
Aggrieved, the assessee appealed to the CIT(A), who, relying on various High Court and Tribunal decisions, held that the civil structure connected to a windmill is part of a composite structure and cannot be seen in isolation. Therefore, the CIT(A) allowed the enhanced rate of depreciation.
The Tribunal found that the CIT(A) had made a reasoned decision based on relevant judicial precedents, and the Revenue did not present any fallacy in CIT(A)’s findings nor any contrary binding decisions. Thus, the Tribunal upheld the CIT(A)’s order, allowing the enhanced depreciation rate and dismissed the appeal filed by the Revenue.
The appeal filed by DCIT, Circle-4(2), New Delhi was dismissed.
Order pronounced in the open court on 17.08.2022.
Signed by:
(Narender Kumar Choudhary) – Judicial Member
(Anil Chaturvedi) – Accountant Member
Date: 17.08.2022
PY*
Copy forwarded to:
ASSISTANT REGISTRAR ITAT, New Delhi
ITA No. 351/DEL/2021 – DCIT, Circle-4(2), New Delhi vs Clean Wind Power (Ratlam) Pvt. Ltd.
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