Of Second Proviso To Rule 5(1A) Of Theincome Tax Rules And They Are Entitled Fordepreciation On Windmills As Per Appendix Iis Valid ? v. Whether, Under The Facts And

IN THE HIGH COURT OF JUDICATURE AT MADRAS THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM AND Tax Case Appeal No.734 of 2013The Commissioner of Income Tax, Chennai ...Appellant VsM/s.PMP Textiles Spinning MillsLtd., Chennai-3. ...Respondent APPEAL under Section 260-A of the Income Tax Act, 1961against the order dated 11.2.2013 made in ITA.No.811/Mds/2011 onthe file of the Income Tax Appellate Tribunal Chennai 'D' Benchfor the assessment year 2006-07 against the Appellate order ofthe Commissioner of Income Tax, (Appeals-V), Chennai - 34,dated 31.01.2011 and made in ITA NO.170/2007-08 & 125/2008-09for the Assessment Year 2005-06 & 2006-07 and against theAssessment Order of the Assistant Commissioner of Income Tax,Company Circle - V(4), Chennai dated 24.11.2008 and made in PANNo:AAACP 4346 D for the Assessment Year 2006-2009. For Appellant : Ms.V.Pushpa, SC and Ms.S.Premalatha, SCFor Respondent: Mr.A.S.Sriraman for Mr.S.Sridhar This appeal, filed by the Revenue under Section 260A of theIncome Tax Act, 1961 is directed against the order dated11.2.2013 made in ITA.No. 811/Mds/2011 on the file of the IncomeTax Appellate Tribunal Chennai 'D' Bench for the assessment year2006-07. 2. The appeal was admitted on 30.10.2013 on the followingsubstantial questions of law: “i. Whether, under the facts andcircumstances of the case, the Income TaxAppellate Tribunal was right in holding thatthe assessee has satisfied the requirement https://hcservices.ecourts.gov.in/hcservices/ of Second Proviso to Rule 5(1A) of theIncome Tax Rules and they are entitled fordepreciation on windmills as per Appendix Iis valid ? ii. Whether, under the facts andcircumstances of the case, the Income TaxAppellate Tribunal was right in law ingranting depreciation at 80% on windmills,even though the Proviso to Section 32(1)(i)and Rule 5(1A) clearly stipulate that onlyrate of depreciation on the method asprovided for in Appendix IA will be relevantfor power generating machinery? iii. Whether, under the facts andcircumstances of the case, the Income TaxAppellate Tribunal was right in law ingranting depreciation at 80% on windmills,even though the assessee is entitled at therate of 7.69% of the cost and this rate hascorrectly been allowed by the AssessingOfficer ? iv. Whether, under the facts andcircumstances of the case, the Income TaxAppellate Tribunal was right in law inholding that the assessee is entitled forhigher rate of depreciation even though theassessee had filed return of income withinthe due date and has also not exercised itsoption separately? And v. Whether, under the facts and circumstances of the case, the Income TaxAppellate Tribunal is right in notadjudicating the grounds of appeal of theRevenue regarding completion proceedings bythe Commissioner of Income Tax (Appeals) inviolation of Rule 46A of the Income TaxRules?” 3. We have heard Mr.J.Narayanaswamy, learned Senior StandingCounsel appearing for the appellant and Mr.A.S.Sriraman, learnedcounsel appearing for the respondent. 4. It is not disputed by the learned counsel on either sidethat the substantial questions of law framed for considerationin this appeal have been answered in favour of the assessee andagainst the Revenue by a Division Bench of this Court in thecase of CIT, Coimbatore Vs. Kikani Exports (P) Ltd. [reported in(2015) 369 ITR 500]. 5. Following the said decision, the above tax case appeal isdismissed and the substantial questions of law framed areanswered against the Revenue and in favour of the assessee. Nocosts. Sd/- Assistant Registrar(CS VI) //True Copy// Sub Assistant Registrar To 1.The Income Tax Appellate Tribunal, Chennai 'D' Bench., Chennai.2.The Commissioner of Income Tax, (Appeals-V),Chennai - 34. 3. The Assistant Commissioner of Income Tax, Company Circle V(4),Chennai. +1cc to Mr.M.Swaminathan,Advocate, SR.No.72331 5. Following the said decision, the above tax case appeal isdismissed and the substantial questions of law framed areanswered against the Revenue and in favour of the assessee. Nocosts. Sd/- Assistant Registrar(CS VI) //True Copy// Sub Assistant Registrar To 1.The Income Tax Appellate Tribunal, Chennai 'D' Bench., Chennai.2.The Commissioner of Income Tax, (Appeals-V),Chennai - 34. 3. The Assistant Commissioner of Income Tax, Company Circle V(4),Chennai. +1cc to Mr.M.Swaminathan,Advocate, SR.No.72331 +1cc to Mr.S.Sridhar, Advocate, SR.No.71123 TCA.No.734 of 2013 Kak(28/09/2019)