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2022 (7) TMI 680 - AT - Income TaxDeduction u/s 80IB - allocation of common expenses between exempted and non-exempted units are not accepted - HELD THAT:- CIT (A) has erred inasmuch as the decision in the case of Goetze India Ltd. (2006 (3) TMI 75 - SUPREME COURT] which is fully applicable on the facts of the case wherein proper and due revised return was held to be sine qua non for acceptance of the revised claim and it was clearly held that CIT (A) has no power to make any such concession stop. However, in the same order, it was held that the order in this case does not impinge upon the powers of the ITAT to admit and adjudicate upon grounds raised otherwise then by proper revised return. We direct that the revised claim is to be admitted and adjudicated upon by the AO. However, we note that in the assessment order framed qua deduction u/s 80IB, AO only dealt with and allowed the claim and discussed on merits only that aspect of claim under section 80IB which were mentioned in the original claim. However, as regards the revised claim, the merits have not been gone into by the AO and he has rejected the claim as unadmitted. CIT (A) has admitted the claim and decided the issue very laconically placing reliance upon several case laws. There is no discussion in the order of ld. CIT (A) as to who has examined the factual aspect of the case. He simply accepted the statement of the assessee and passed the same as his own order relying upon the case laws and proposition. Even after, referring to the decision in the case of Liberty India (2009 (8) TMI 63 - SUPREME COURT] which expounded that indirect expenses which do not have any direct nexus with the undertaking cannot be deducted in computing the profit of the undertaking. He went on to accept that the assessee has been able to establish the direct nexus between income and expenses of the industrial units situated at Samba and Udhampur. He also noted that it is also argued that the indirect and head office expenses have been excluded from allocation amongst exempt and non-exempt units. Based on such reasoning, he has directed the Assessing Officer to re-compute the taxable income. We find that the above exhibits lack of proper application of mind. Without referring to any factual material on the basis of arguments and submissions, ld. CIT (A) has given finding on factual aspects which is not sustainable in law. As held in the case of Kapurchand Shrimal [1981 (8) TMI 2 - SUPREME COURT] it is the duty of the appellate authority to correct the errors in the orders of authorities below and remand the matter for re-adjudication with or without direction unless prohibited by law. Accordingly, in the interest of justice, we remit this issue to the file of AO. AO shall examine the grounds which are rejected by him by duly considering the merits of the case, factual aspects and case laws in this regard. Appeal of the Revenue stands allowed for statistical purposes.
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