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2020 (6) TMI 136 - AT - Income TaxDeduction u/s 80IC - unit number III situated in Ponta Sahib, which was set up on 30 March 2010 - whether rebate claimed u/s 80IC was being allowed to the appellant from year to year after thorough scrutiny u/s 143(3) for all the years since Assessment Year 2008-09? - Assessee is engaged in the business of trading in pipes and manufacture of waste disposal bins and containers for onward sales to various government agencies and Municipal Boards on tender basis - HELD THAT:- We are of the view that in the initial years if the deduction is allowed then, AO cannot disturb that as far as eligibility of the unit is concerned but the measurement of the profit can always be tested on a year-to-year basis. Therefore, the issue of machinery and the installation of power meters were already examined by the AO in the initial years. There is no objection by the revenue on granting the deduction under section 80 IC of the income tax act to the assessee on these two issues in earlier years. Thus, the AO could not have raised the issue of non availability of machinery, unless the original machinery installed at the time of the setup have been transferred by the assessee and are not available during the year. Similarly, the issue of the lesser capacity of electricity meter also could not be raised. In absence of the basic enquiry, merely rejecting the explanation of the assessee without obtaining further evidences, AO could not have rejected the production of the assessee. With respect of the transportation of goods, only reason mentioned by the learned assessing officer is that assessee could not produce Toll tax receipt. AO himself has admitted that the assessee has provided VAT form 26A which shows that trucks crossed Himachal Pradesh Haryana border at Bahral Check post. In form number 26A, under VAT laws, there is a complete detail of the goods transported, lorry numbers, quantity of the goods, the time of removal from the factory of those goods et cetera. This also can be examined from the excise records. Therefore, it was not denied that goods were removed from the factory. Merely because the assessee could not produce the toll tax receipt, it cannot be said that the goods did not transfer from Bharal Check post to Delhi. When the goods removed from the factory have not been disputed, it cannot be said that goods that transported to barhal Check post did not go to Delhi, as it is not supported by toll tax receipts. Coming to the issue of the machinery, objections of ld AO are that CST VAT has been charged in the invoices but no details of such CST VAT are available on the invoices, amount in words is not mentioned on the invoices, details of delivery date, delivery channel number, mode of transport, lorry receipt number, transporter name, vehicle number are not mentioned in the invoices, details of terms and conditions of purchases are not mentioned, jurisdiction is not mentioned price per unit rate of the machinery is not mentioned, all the invoices are of the same date i.e. 30-3-2010. AO has also attached the photocopies of the bills of the machinery. Alarmingly all these bills pertain to financial year 2009 – 10 when the original unit was set up. These bills are not pertaining to this year i.e. assessment year 2014 – 15. In the original assessment year, the 80 IC benefit is already granted in 143 (3) of the act by the assessing officer himself. In those years, these machineries were purchased. Naturally, the bills would have been of the date of 30 March 2010 because on that date the unit III was set up. After that almost 4 years have passed. If assessing officer wants to prove that bills of machineries purchased by the assessee in March 2010 are bogus, he should have first disturbed the assessment year 2010 – 11. Whole exercise by the assessing officer is useless. Even otherwise, not mentioning something in the bills does not make purchases of goods through those bills bogus. It leads to making a larger allegation on flimsy grounds. No merit order of the assessing officer disallowing the deduction under section 80 IC - also do not agree with the order of the learned CIT – A which did not deal with any of the submissions of the assessee in proper perspective. - Decided in favour of assessee.
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