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2013 (9) TMI 406 - AT - Income TaxDeduction u/s 80IC - New manufacturing unit - whether the profits earned by Parwanoo Unit really represented profits from manufacturing activity at Parwanoo Unit or not. - AO observed that that the Unit at Parwanoo does not appear to have been established physically. Therefore, the assessee was asked to show cause as to why deduction claimed u/s 80IC of the Act should not be disallowed. - Held that:- The major objection of the Assessing Officer was that in such a short period of four months without the help of technical people, it was not possible to achieve the said turnover. We do agree with the Ld AR that assessee had every document to support that unit was established and we also agree with Ld AR that turnover was intimated to Sales tax authorities but the important question remains whether the entries of sales and purchases were any book entries or actual entries. The doubt of book entries is further corroborated by the fact that out of turnover of ₹ 1,34,39,000/- during the year an amount of ₹ 1,06,53,550/- remained invested in sundry debtors and out of purchases of ₹ 51,19,374/- an amount of ₹ 33,48,468/- remained unpaid upto 31.3.2005. Though Ld CIT(A) has mentioned that money was received from debtors but the fact remains that turnover was made hurriedly in a period of four months that to without realizing the debtors. The profiles of buyers of assessee needs to be investigated to ascertain as to whether these persons actually dealt in the goods purchased from the assessee and further sellers profiles also needs to be investigated to ascertain as to whether they really dealt into the items sold by them to assessee. - Decided in favor of revenue for statistical purpose.
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