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2012 (12) TMI 16 - AT - Income TaxDeduction u/s 10AA - SEZ - appellant engaged in the business of manufacturing and export of jewellery - dis-allowance on ground of various objections - AY 08-09 - Held that:- On first objection of AO that building was not ready for commencement of the production, it is observed that merely because some gate fitting was not done, it cannot be said that the building was not ready - second objection that the machine purchased is not adequate for manufacture of the jewellery it is observed that in the next year, the claim of the assessee was allowed by passing the assessment order u/s 143(3). Hence, if the same machineries were sufficient for effecting the export sale in A.Y.2009-2010, the claim of the assessee in the present year working of about six months cannot be doubted. Regarding third and fourth objection it is observed that it can not be said that merely because some electric installation for socket and PVC cable was done in March, 2008, commercial production had not started in August, 2007 - next objection that first electricity bill of the unit was received in the month of November, whereas the assessee has claimed export in the months of September and October it is observed that this is not the fact of the present case that there was a bill in August and October, 2007 also in which there was no power consumption and power consumption has started from November, 2007 only. When there is no bill for the months of August, September and October, 2007, it cannot be said that there was no power consumption during that period - Other objection are held to be invalid rejecting claim on ground that printer, AC, and steel safe was purchased after the first export bill. Since none of the objections raised by the AO is valid for rejecting the claim of the assessee for exemption u/s 10AA, particularly, when the same claim was allowed by the AO himself in the next year, deduction u/s 10AA is allowed in the present year. Addition u/s 68 - unexplained cash credit - capital introduced by partners - Held that:- Issue is now fully and squarely covered in favour of the assessee by decision in case of CIT Vs. Pankaj Dyestuff Industries (2005 (7) TMI 601 - GUJARAT HIGH COURT) wherein it was held that the Revenue is at liberty to examine the issue in the hands of the partners, and if such partners are not able to satisfy regarding the source of investment, then the addition can be made in the hands of the partners, but no addition can be made in the hands of the firm in respect of introduction of capital by the partners. In view of aforesaid, addition is deleted.
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