Case Law Details
V. Sabitamani Vs Asst.CIT (Madras High Court)
It was pointed out that the original owner, the assessee’s vendor had claimed depreciation to the extent of Rs.3 Crores within six years and when the owner sells the windmill to the new purchaser, the new purchaser cannot get the same benefit for the enhanced value, as there is no additional wind energy capacity installed. Ultimately, the assessing officer disagreed with the assessee and disallowed the claim of depreciation to the tune of Rs.77,12,640/-.
15. The CIT[A], in our considered view, while partly allowing the assessee’s appeal, proceeded to make a adopt estimations of the value and fixed the sum at Rs.1,50,00,000/-. We find that there is no scientific basis for such fixation of the value of the second-hand windmill and such fixation has been done based on the personal opinion of the CIT[A]. Therefore, the Tribunal was fully justified in allowing the Revenue’s appeal. With regard to the assessee’s appeal, the Tribunal re-appreciated the factual position and in particular, noted that the manufacture of the windmill has certified that the windmill, which was sold to the assessee is no more in the market value and the technology has become obsolete. The Tribunal also considered as to what would be the effect of a report of the government valuer and noted Explanation III to Section 43(1), which requires the assessing officer to arrive at an objective satisfaction. Further, the Tribunal observed that valuations may be relevant in ordinary circumstances, but when cumulative depreciation claimed was far in excess of the cost, the valuation report of the approved valuer becomes insignificant.
Thus, in our considered view, the Tribunal has reappreciated the factual position and come to a conclusion that the order passed by the assessing officer requires no interference.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
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