The Commissioner Of Income Tax Ii, Coimbatore v. M/S.k.k.s.khader Mohideen Sahib And Sons

IN THE HIGH COURT OF JUDICATURE AT MADRAS Coram THE HONOURABLE MR. JUSTICE M.M.SUNDRESHandTHE HONOURABLE MR. JUSTICE N.ANAND VENKATESH T.C.(A). No.1004 of 2010 The Commissioner of Income Tax II,Coimbatore... Appellant/Respondentvs. M/s.K.K.S.Khader Mohideen Sahiband Sons,15, E.M. Balasubramaniam Road,Thiru Nagar, Erode - 638 003. .. Respondent/Appellant Appeal filed under Section 260A of the Income Tax Act, 1961against the order of the Income Tax Appellate Tribunal "D"Bench, Chennai dated 20.11.2009 passed in I.T.A. No.834/Mds/2009and against appeal no.248/2008-09 dated 19.3.2009 by theCommissioner of Income Tax/Appeal -I/Coimbatore and against theP.A No.AAEFK6858Q/ward - I(1), Erode/2002-03 dt.31.12.2008 bythe Income Tax Officer, ward I(1), Erode. For Appellant:Ms.K.G.Usharanifor Mr.T.R.Senthil KumarFor Respondent :Mr.Subbaraya Aiyar (Judgment of the Court was delivered by M.M.SUNDRESH, J.)The Revenue has filed this appeal by formulating thefollowing substantial questions of law in respect of theassessment year 2002-2003:"(1)Whether on the facts and in the circumstancesof the case, the Income Tax Appellate Tribunal wasright in law in holding that the assessee havesatisfied the requirement of second proviso to Rule 5(1A) of the Income Tax Rules and they are entitled fordepreciation on wind mills as per Appendix I is valid? https://hcservices.ecourts.gov.in/hcservices/ (2)Whether on the facts and in the circumstancesof the case, the Income Tax Appellate Tribunal wasright in law in granting 80% of depreciation on windmills, even though the proviso to Section 32(1)(i) andRule 5(1A) clearly stipulate that only rate ofdepreciation on cost method as provided for inAppendix -IA will be relevant for power generatingmachinery? (3)Whether on the facts and in the circumstancesof the case, the Tribunal was right in law in grantingdepreciation at the rate of 80% of wind mills, eventhough the assessee is entitled 7.69% of the cost andthis rate of depreciation has been correctly allowedby the Assessing Officer? (4)Whether on the facts and in the circumstancesof the case, the Income Tax Appellate Tribunal wasright in law in holding that the assessee is entitledfor higher rate of depreciation even though theassessee has filed return on due date and has also notexercised his option separately?" 2.The assessee filed income tax return by claimingdepreciation at the rate of 80% on wind mills. The assessingofficer restricted the claim to 7.69% on the ground that theassessee had not exercised the option under proviso to Rule 5(1A) of Income Tax Rules for claiming depreciation at a higherrate. The appeal filed by the assessee before the Commissionerof Income Tax (Appeals) was dismissed, confirming the order ofthe assessing officer. Against which, the assessee preferred anappeal before the Income Tax Appellate Tribunal. The Tribunalrelied upon the judgments of the Punjab and Haryana High Courtin CIT Vs. Jindal Steels and Power Limited (180 Taxman 543) andBombay High Court in CIT Vs. Vijaya Hirasa Kalamkar (229 ITR772) and allowed the appeal. Aggrieved by the same, the Revenueis before us with this appeal. 3.Heard the learned counsel appearing for the appellant andthe learned counsel appearing for the respondent. 4.When the matter is taken up for hearing, learned counselappearing for the respondent/assessee submits that the issueinvolved in this appeal is covered by the order of this Court inCommissioner of Income Tax, Coimbatore Vs. Kikani Exports (P)Ltd., ((2015) 369 ITR 500) against the Revenue and in favour ofthe assessee. In the said decision, it has been held that thethird proviso clearly states that the option once exercised willcontinue to all the subsequent years and therefore, the assessee is not required to exercise such option each and every yearseparately. 5.In such view of the matter, the Tax Case Appeal standsdismissed. No costs. Sd/- Assistant Registrar(CS VIII) //True Copy// mmi 4.When the matter is taken up for hearing, learned counselappearing for the respondent/assessee submits that the issueinvolved in this appeal is covered by the order of this Court inCommissioner of Income Tax, Coimbatore Vs. Kikani Exports (P)Ltd., ((2015) 369 ITR 500) against the Revenue and in favour ofthe assessee. In the said decision, it has been held that thethird proviso clearly states that the option once exercised willcontinue to all the subsequent years and therefore, the assessee is not required to exercise such option each and every yearseparately. 5.In such view of the matter, the Tax Case Appeal standsdismissed. No costs. Sd/- Assistant Registrar(CS VIII) //True Copy// mmi Sub Assistant Registrar To1. The Income Tax Appellate Tribunal, "D" Bench, Chennai.2. The Commissioner of Income Tax II, Coimbatore3. The Commissioner of Income Tax Appeal I, Coimbatore4. Income Tax Officer Ward I(1), Erode+1cc to Mr.T.R.Senthilkumar, Advocate Sr.No.48248+1cc to Mr.Subbaraya Aiyar, Advocate Sr.No.48769VBA(CO)sm:7.8.2018 T.C.(A).No.1004 of 2010