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2017 (9) TMI 1403 - AT - Income TaxDisallowance of deduction u/s. 80IA - job work executed by Unit I in Unit II - whether unit-II is merely reconstruction of already existing business unit-I of the assessee and hence not eligible for such deduction? - CIT-A allowed claim - Held that:- Revenue has failed to adduce any material on record to take a view different from that taken by ITAT in the case of assessee for earlier years as held It has not been disputed by the department that for two initial years i.e. 1998- 99 and 1999-2000, both units I & II were independently manufacturing and unit II was set up by separate new machineries. Thus unit II cannot be held to be a unit established by reconstruction of business. For two years it was an independent 4 business of the assessee set up by new plant & machinery and on which AO himself allowed deduction u/s 80-IA on these findings. 5.1 Once it is so, merely because in subsequent years Unit II got some of its manufacturing activities executed by Unit I on job work basis will not reverse the clock. It cannot be held that what was new and independent business stands transformed into a reconstructed old business, because of job work. Therefore, independent status of Unit II cannot be altered as proposed by AO due to job work executed by Unit I. - Decided in favour of assessee. Disallowing bonus/commission paid to the directors of the company - CIT-A allowed claim - Held that:- Revenue has failed to rebut the findings of the ld. CIT(A) which alludes that there was no any ulterior motive of the assessee behind payment of bonus/commission to the working directors of the company. Moreover, the issue has been well decided in favour of the assessee by Hon’ble Delhi High Court in the case of CIT vs. Career Launcher India Ltd. (2012 (4) TMI 440 - DELHI HIGH COURT ) as held so long as the bonus or commission is paid to the directors for services rendered and as part of their terms of employment it has to be allowed and sec.36(l)(ii) does not apply. - Decided in favour of assessee.
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