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2017 (6) TMI 1317 - AT - Income TaxAddition on account of rent receipts shown as “business income” -HELD THAT:- Income in respect of Gadhidham unit was already offered to tax as evident from the financial statement of the assessee which are placed on pages 1 to 21 of the paper book, more particularly from the profit and loss account which is placed on page 9 of the paper book. Moreover, we find that Ld. CIT(A) has merely directed the AO to verify the same whether the income in respect of Gandhidham unit has been included in its books of account, as such, we find no infirmity in the order of Ld. CIT(A). Thus the AO has all the right as provided under the statute to ensure whether income has been included in the income of the assessee and therefore we find no infirmity in the order of ld. CIT(A). Hence, this ground of Revenue’s appeal is dismissed. Benefit u/s 80-IB(11A) denied - Deduction was denied by AO on the ground that the warehouses in respect of which the deduction was claimed were not ready for commercial activities in the year under consideration - HELD THAT:- On perusal of Section u/s 80IB of the Act we find there is no pre-condition for claiming the deduction that there has to be any completion certificate. Admittedly, the income of assessee has shown the unit located at Gandhidham in its profit and loss account. Thus, in our considered view, the deduction u/s. 80IB(11A) of the Act cannot be denied merely on the ground that completion certificate was furnished at the fag-end of financial year. It is also pertinent to note that the inspector has given the report by stating that the warehouse was rented out to M/s Rishi Shipping Limited since long which proves that the commercial activity started before the completion certificated obtained by the assessee. Other reason that the requirement of provision of Sec. 80IB(11A) of the Act that the assessee must be engaged in the integrated facilities providing for handling, transportation and storage charges. In this regard, we find that the assessee has not produced any supporting documents other than list of clients which are placed in the record. On perusal of that list, we find that it is internal list maintained by assessee which was duly furnished before Authorities Below. However, in our considered view, the list cannot be a conclusive evidence that the assessee is engaged in providing integrated service. We disagree with the contention of Ld. DR that there was a storage of DAP (fertilizer) in the warehouse maintained by assessee. it is because, the AO observed that there was a storage of DAP (fertilizer) on the basis of report submitted by Inspector which was furnished in the year 2009-10 and there is no information available with the Revenue what was stored in the year under consideration in the warehouse of the assessee. Therefore, we are of the view that the Revenue has failed to produce necessary evidence suggesting that there was storage of DAP (fertilizer) and not food-grains in the year under consideration. Whether the assessee is engaged in the integrated service as envisaged under the provision of Section 80IB(11A) ? - AR has furnished a list of 17 pages wherein the income of storage, transportation, and handling charges was shown. However, in our considered view, that the list cannot be treated as conclusive evidence to hold that the assessee is engaged in the integrated services. Besides the above, we also find that the AO has not exercised his power u/s. 143(3) of the Act to ascertain from the parties where they availed integrated services from the assessee. With this view of the matter, we are inclined to give one more opportunity to assessee to justify its claim for deduction u/s. 80IB(1A) of the Act. In the light of above stated discussion, thus, we restore this issue to the file of AO to adjudicate the issue afresh in accordance with law and after giving opportunity of being heard to assessee. Hence, this ground of Revenue’s appeal is allowed for statistical purpose. Disallowance made by AO for debt redemption reserve in calculating book profit u/s. 115JB - HELD THAT:- Judgment of Hon'ble Bombay High Court in the case of CIT vs. Raymond Ltd. [2012 (4) TMI 127 - BOMBAY HIGH COURT] has held that the debenture redemption reserve is a ascertained liability and therefore allowable deduction u/s. 115JB of the Act. - Decided against revenue.
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