TMI Blog2005 (1) TMI 602X X X X Extracts X X X X X X X X Extracts X X X X ..... ech. The industrial undertaking of the assessee is located in Union Territory of Dadra and Nagar Haveli which is notified backward area for the purposes of section 80-I of Income-tax Act, 1961. On 15-3-2000, there was a survey action under section 133A and assessee s claim for deduction under section 80-I was examined with a view to find out whether assessee fulfilled conditions laid down in the Act for allowance of deduction under that section. For this purpose, a statement under section 131 of the Act was recorded from one Shri Lalchand Tiwari who was supervisor of the assessee working in the assessee s factory at 1/5B, Ankur Industrial Estate, Dadra. During the course statement of Shri Lalchand Tiwari recorded under section 131 of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... employed have made available to the Assessing Officer and certified in Form No. 10CCB issued by a Chartered Accountant regarding the assessee s claim for deduction under section 80-I indicated that there were more than 10 workers employed by assessee in his new industrial undertaking. Regarding statement of Lalchand Tiwari, it was stated before the Assessing Officer that the said statement was given under fear, threat and coercion and same was retracted by Lalchand Tiwari on 18-3-2000. Assessing Officer once-again recorded the statement of Lalchand Tiwari on 2-3-2001 during the course of assessment proceedings. In this statement, Shri Lalchand Tiwari stated that he was not in proper frame of mind on the day of survey when he stated that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ply "at present, I am not able to produce any evidence". Ultimately on the basis of these facts indicated above, Assessing Officer concluded that assessee failed to employ 10 or more workers in his industrial undertaking M/s. Shivtech and thereby he failed to comply with the requirements of section 80-I(2)( iv ) of Income-tax Act, 1961. Accordingly, assessee s claim for deduction of Rs. 29,53,523 under section 80-I was disallowed. Matter was carried before the first appellate authority wherein assessee reiterated the submissions made before the Assessing Officer. However, CIT(A) was also not convinced with the contentions of the assessee and accordingly, upheld the order of Assessing Officer. 3. Before us, the learned A.R. filed certifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l undertaking which fulfils all the following conditions, namely : ( i ) to ( iii )** ** ** ( iv ) in a case where the industrial undertaking manufactures or produces articles or things, the undertaking employs ten or more workers in a manufacturing process carried on with the aid of power, or employs twenty or more workers in a manufacturing process carried on without the aid of power." It is undisputed that assessee s industrial undertaking manufacture goods or produces articles or thing. It is also undisputed that assessee s undertaking s manufacturing process is carried on with the aid of power. In such unit, assessee is supposed to employ 10 or more workers for being eligible to claim deduction under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the paper book. It is pertinent to mention that the abovesaid wages has not been disputed by the Assessing Officer. Apart from this, assessee has also filed details of salary of these employees (given at annexure-2) before Assessing Officer wherein total salary of 4 employees i.e. Shri Jatin Parmar, Shri Harish Patel, Shri Kishore Singh Rathod and Shri Santaram Kadam, at Rs. 1,22,906 which has also not been disallowed by the Assessing Officer. It is strange to observe that at one hand, the Assessing Officer s stand is that assessee is not employing the requisite number of workers as envisaged under the provisions of section 80-I(2)( iv ) i.e. 10. At the same time, Assessing Officer is not making any disallowance of wages of Rs. 1,66,80 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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