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2015 (10) TMI 1520 - HC - Income TaxAddition on account of suppressed production and sale of AMT cut at Unit G-3 & G-4 - ITAT deleted the addition - Held that:- The Court is of the view that opinion of the CIT (A), which has been concurred with by the ITAT, was essentially based on facts as found that the AO had presumed the length of the entire polyester film roll to be 6100 m, whereas, all rolls were not of that length. Even the wastage of batch of roll was presumed to be 14% without making a comparison with the actual production. There was no reason given by the AO as to why the details of actual production were ignored. Moreover, the manufacturing record was verified by the excise authorities and no discrepancy had been noted in the relevant statutory registers. Even the calculation of the excess production based on consumption of chemicals was factually incorrect particularly since the chemical was not the principal raw material. CIT (A) also noted that the AO had made additions by taking the sale of AMT cut at ₹ 3 per cut, which was inclusive of excise duty of 60 paise.. The order of the CIT (A) has elaborately discussed the said facts in support of its conclusion. With the factual findings of both the CIT (A) and the ITAT being concurrent, the Court is of the view that no substantial question of law arises for consideration, as far this issue is concerned. - Decided against revenue. Addition on account suppressed sale of blank audio cassettes from Namoli Unit - ITAT deleted the addition - Held that:- Additions were made without there being any evidence of under-invoicing of sales. The additions were made on the basis of suspicion. Merely because some of the cassettes were sold at a higher price, it did not mean that all cassettes ought to have been sold at a higher price. - Decided against revenue. Deduction u/s 80HH and 80-I in respect of the Namoli Unit and deduction u/s 80-IA in respect of Malanpur Unit? - Held that:- Decided in favour of the Assessee and against the Revenue by the decision of the Supreme Court in JCIT v. Mandideep Engineering & Packing Industries (P) Ltd. (2006 (4) TMI 75 - SUPREME Court) and the decision of this Court in CIT v. SKG Engineering Pvt. Ltd. (2005 (5) TMI 37 - DELHI High Court) which in turn refers to the decisions in CIT v. J.P. Tobacco (1996 (8) TMI 29 - MADHYA PRADESH High Court) and CIT v. Chokshi Contracts Pvt. Ltd. (2001 (2) TMI 66 - RAJASTHAN High Court). - Decided against revenue. Undisclosed investment in production in Unit G-5 & G-6 - ITAT deleted the addition - Held that:- The CIT (A) correctly pointed out that even according to the AO's own calculations, the content of polyester film in a VMT cut worked out to 76.34 grams. The CIT (A) concluded that the polyester film content of 1 VMT E-180 could not be 90 gm as surmised by the AO because that would exceed the gross weight of the polyester film. The very foundation of the alleged understatement of consumption was therefore found to be misconceived. 90 gm of VMT comprised polyester film (76.34 grams) and chemicals (14 grams). The AO in making the addition did not consider the weight of the chemicals. As a result, the entire calculation was rendered erroneous. - Decided against revenue.
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