TMI Blog2013 (2) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 17,25,000/- out of share capital as unexplained credits u/s 68 - in favour of revenue. Difference in job work charges/conversion charges credited to the P&L a/c and the amount furnished in the TDS certificate - additions confirmed by CIT(A) - Held that:- The assessee had produced the details of tax deducted at source with respect to job work charges and transport charges and the difference of Rs. 84,850/- represents the amounts paid by various parties on account of transport charges and has been credited to the account of transport charges. Therefore, the addition made by the Assessing Officer and confirmed by the CIT(A) on the ground that the assessee has not been able to produce satisfactory evidence in the matter, explaining the difference in the amount of job work charges as per TDS certificate and the amount offered as receipts, is deleted. Disallowance as contributions towards PF and ESI as per the provisions of section 43B - Held that:- The deduction of payment of employees’ contribution towards provident fund and ESI cannot be disallowed under section 43B, if paid before the due date of filing the return. Set aside the order of the CIT(A) and restore the issue to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 68 of the Act. 4. The amount invested in the form of share application money in the names of ten persons aggregating to Rs. 30 lakhs was examined by the AO, who asked the assessee to furnish the list of share applicants, their addresses, confirmatory letters and details of sources of investment in assessment proceedings. The names of the 10 persons are as under: 1. G. Venkat Rao Rs. 10,00,000/- 2. G. Lakshman Rao Rs. 3,00,000/- 3. Bh. S.R. Anjaneyulu Rs. 3,00,000/- 4. G. Gandhi Rs. 3,00,000/- 5. Bh. Prasada Rao Rs. 3,00,000/- 6. Bh. Varalakshmi Rs. 1,00,000/- 7. G. Seetharama Chandra Rao Rs. 1,25,000/- 8. G. Satyanarayana Rs. 1,75,000/- 9. G. Bhagyalakshmi Rs. 3,00,000/- 10. G. Narayanamma Rs. 1,00,000/- 5. The AO observed from the information furnished by the assessee that the confirmations were stereotyped and source of investment in most of the confirmations was mentioned as agriculture. Thereafter, the AO wrote separate letters to the share applicants requesting them to furnish the complete details regarding the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f CIT Vs. Ruby Traders and Exporters Ltd., 263 ITR 300 and on review in 270 ITR 526 and in the case of Bhola Shanker Cold Storage Pvt. Ltd. Vs. JCIT, 270 ITR 487. The CIT(A) also reproduced the Hon ble Delhi ITAT decision in the case of Napar Drugs Pvt. Ltd. Vs. DCIT, 98 ITD 285. The CIT(A) observed that a similar view has been taken by the ITAT, Hyderabad in an order dated 09/07/2003 in the case of VBC Fertilizers Pvt. Ltd. Vs. DCIT in ITA No. 451/Hyd/97. The CIT(A) discussed the additions made by the Assessing Officer u/s 68 of the Act, regarding share application money invested in the name of various persons applying ratio of the decisions in the cases cited supra. 9. As regards G. Venkata Rao, the CIT(A) directed the AO to delete the said amount, hence, the assessee is not in appeal before us in this case. 10. As regards G. Laxmana Rao, the CIT(A) held that on careful consideration of the arguments on both the sides and the evidence placed on record, even though this person was having agricultural land in his possession as well as bank accounts, the investment had not come out of the bank account, but had been made by way of demand draft. It was held that a perusal of the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cate issued by the MRO is concerned, the CIT(A) held that these certificates are being issued by the MROs in a routine manner without any real verification and enquiry. As far as Smt. G. Bhagyalakshmi is concerned, the CIT(A) held that she had no significant source of income and even the income certificate issued by the MRO mentioned an annual income of Rs. 35,000/-, which is meager. The CIT(A), therefore, held that the investments shown in the name of above two persons amounting to Rs. 6 lakhs were treated treating as unexplained credits u/s 68 of the Act, and confirmed the action of the AO on this count. 13. As regards Bh. Prasada Rao and Varalakshmi, the CIT(A) observed that the investments in the name of these two persons, husband and wife, are also made on the same day i.e. 24/02/1999, and similar certificates from MRO etc. had been filed. The CIT(A) further observed that the AO had mentioned in his report that the amount of Rs. 3 lakhs was deposited on 23/02/99 in the account of Sri Bh. Prasada Rao and withdrawn on the immediate next date i.e. 24/02/99, which only showed that this person did not have regular source for investment. Regarding Smt. Varalakshmi, the income cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e through DD evidencing actual passing of money from the investor to the assessee. He further submitted that the amount invested has subsequently been returned to the investor. He, therefore, submitted that the investment made by the investor ought to have been accepted as genuine. 17. In the case of Shri Bh.S.R. Anjaneyulu, the learned counsel for the assessee made similar submissions as in the case of G. Lakshmana Rao. He invited our attention to pages 4 and 6 to 7 as also pages 25 to 27 of the paper book containing affidavit by the investor confirming ownership of Ac.17.00 cents of fertile agrl. Land and copy of bank account as also order of spl. Dy collector, Tribal Welfare confirming ownership of agrl. Land. It is submitted that the shares have subsequently been allotted to the investor. 18. As regards G. Gandhi G Bhagyalakshmi, the learned counsel for the assessee invited our attention to pages 10 to 13 and pages 33 to 35 and 36 to 38 of the paper book containing affidavit by the investor and copy of bank account and land owners rights pass book showing ownership of Ac. 8-46 cents of fertile agrl. Land as also order of Spl. Dy. Collector confirming ownership of agrl.lan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee had been discharged. Therefore, the AO was justified in not being satisfied by the explanation offered by the assessee in relation to the impugned cash credits because assessee had not proved capacity of such creditors to advance the money and he was justified in making additions of the cash credits under sec. 68. 25. In the case of Napar Drugs Pvt. Ltd. Vs. DCIT, 98 ITD 285 (Del.)(TM), the ITAT held as under: 66. On perusal of the above enumerated judgments in relation to the assessment of unexplained share capital of a company it is seen that the courts have held that the question is predominantly a question of fact. It should be borne in mind that in the case of CIT v. Stellar Investment Ltd. 192 ITR 287 (Del), the revenue's petition has been dismissed with the remark, "No question of law arises". When the Hon'ble High Court themselves have observed that no question of law has arisen from the order of the Tribunal, it is hard to see as to how that judgment may be considered to have made a declaration of law on the subject. In the case of Sophia Finance Ltd. (supra), Hon'ble High Court have held that it would be open to the Assessing Officer to go into the que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of share capital itself. In a case where the public issue of sharers not in doubt, it cannot be conceived as to how any share capital contribution can be assessed as income of the company for reason only of some share applicants not being able to explain the source of funds invested by them. At the same time in a case where the facts and circumstances justify the finding that what has been credited as share capital of the company is actually not so, the provisions of Section 68 clearly permit an IT. authority to make enquiries and if necessary to assess the same as representing the income of the company. 26. In the case of Oriental Wire Industries (P) Ltd. Vs. CIT, 131 ITR 688, the Hon ble Calcutta High Court has held that it is necessary for the assessee to prove prima facie the transaction which results in a cash credit. Such proof includes proof of the identity of his creditor, the capacity of such creditor to advance the money and, lastly, the genuineness of the transaction. Only after the assessee had adduced evidence to establish prima facie the aforesaid evidences the onus shifts to the department. Where the assessee establishes only the identity of the creditor and n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes as income of the assessee. In this connection, the assessee submitted that the said difference represented amounts paid by the parties on account of transport charges which were credited to transport charges account, as could be seen from the account copies of the concerned parties and details of transport charges filed in the paper book. 32. On appeal, the CIT(A) obtained remand report from the AO wherein the AO had stated that the assessee has not filed any evidence by way of confirmation from the concerned parties regarding the explanation, hence, the difference amount of Rs. 84,850/- is correctly added to the total income in assessment. 33. The CIT(A) after considering the submissions of the assessee and remand report of the assessee, held that the assessee had not been able to produce satisfactory evidence in the matter explaining the difference in the amount of job work charges as per TDS certificates and the amount offered as receipts, therefore, he confirmed the addition made by the AO. 34. Aggrieved, the assessee is in appeal before us. 35. We have heard the arguments of both the parties, perused the record and gone through the orders of the authorities below. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 43B was worded would cause hardship to those taxpayers who had paid sales-tax within the statutory period prescribed for this payment, although the amount so made by them did not fall in the relevant previous year. This was because the sales-tax collected pertained to the last quarter of the relevant accounting year. It could be paid only in the next quarter which fell in the next accounting year. Therefore, even when the salestax had in fact been paid by the assessees within the statutory period prescribed for its payment and prior to the filing of the income-tax return, these assessees were unwittingly prevented from claiming a legitimate deduction in respect of the tax paid by them. This was not intended by s. 43B. Hence, the first proviso was inserted in sec. 43B. The amendment which was made by the Finance Act of 1987 in sec. 43B by inserting, inter alia, the first proviso, was remedial in nature, designed to eliminate unintended consequences which may cause undue hardship to the assessee and which made the provision unworkable or unjust in a specific situation. Expln. 2 was added to section 43B by the Finance Act of 1989 with retrospective effect from 1st April, 1984. The mem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed under section 43B, if paid before the due date of filing the return. In view of this fact, we set aside the order of the CIT(A) and restore the issue to the file of the AO with a direction to allow this ground of appeal of the assessee, if the payments of PF ESI are made before the due date of filing of the return in the light of the decision of the Hon ble Supreme Court in the case of Allied Motors Pvt. Ltd. (supra) 41. Ground No. 5.a) b) is directed against the action of the CIT(A) in confirming the action of the AO in reducing 90% of the job work charges of Rs. 7,34, 685/- and excise duty of Rs. 65,06,490/- from profits of business applying clause (baa) of Explanation to section 80 HHC of the Act. 42. The issues involved in the computation of deduction u/s 80 HHC of the Act by the AO are reduction of 90% of job work charges and excise duty from profits of the business by applying clause (baa) of explanation to section 80HHC of the Act, after which the adjusted profits had been reduced to a negative figure, and no deduction u/s 80 HHC had been allowed. 43. On appeal before the CIT(A), the learned AR of the assessee had relied upon the decision of Hon ble Bombay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome, form an item of independent income like rent, commission, brokerage, etc., and, therefore, 90 per cent of the processing charges has also to be reduced from the gross total income to arrive at the business profits and, therefore, it has also to be included in the total turnover in the formula for arriving at the business profits in terms of clause (baa) of the Explanation to section 80HHC(3) of the Act. Accordingly, the AO is directed to recompute the deduction u/s 80HHC(3) of the Act, following the decision of the Apex Court in the case of Ravindranathan Nair (supra). 48. Ground No. 6 is directed against the action of the CIT(A) in sustaining the addition of Rs. 1,61,050/- representing agricultural income as income from other sources. 49. The AO had disallowed expenses of Rs. 64,060/- towards cultivation on the ground that they were not incurred in connection with running of business and he had also treated the agricultural receipts of Rs. 1,61,050/- as income from other sources on the ground that there is no evidence of agricultural operations and earning of agricultural income. 50. Before the CIT(A), the learned AR of the assessee had stated that evidence for sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous dates and the material available on record, the issue regarding genuineness of investment in share capital/loans by various persons discussed and decided as under: 59. In case of Sri G. Venkata Rao, the CIT(A) directed the AO to delete the addition made in this regard and the assessee is not in appeal before us. 60. In case of Sri Bh. Seeta Ramanjaneyulu, the CIT(A) observed that a total investment of Rs. 50,000/- in the name of this person was shown on 15/06/2000, which had been claimed as out of agricultural income and the AO noted that he had not filed any proof of earning agricultural income except for MRO certificate for holding the lands in his name. The CIT(A) held that the amount stated to be invested by this person is not out of withdrawal from the bank account and even the agricultural income, for which receipts are mentioned are not so much that after deducting expenses, the remaining amount would be sufficient for investment of Rs. 50,000/- in shares. He, therefore, confirmed the action of the AO in treating the amount as unexplained u/s 68 in this case. 61. The learned counsel for the assessee submitted before us that the investors are holding substantial agr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar the date of investment or near about period. Hence, the CIT(A) confirmed the action of the AO in treating the said amounts as unexplained credits u/s 68 of the Act. 67. The learned counsel submitted investment of Rs. 50,000/- by Shri Bh. Prasada Rao and Rs. 75,000/- by Smt. Bh. Varalakshmi has been made from agricultural income as the investors own 10 acres and 45 cents of fertile agricultural land. The learned counsel also filed affidavits at page 5 6 of the paper book by both the investors and stated that the shares have been subsequently allotted to these investors. 68. We find that n cases of Sri Bh. Prasada Rao Smt. G. Varalakshmi, the CIT(A) held that there is no evidence for earning of agricultural income by these persons and even a perusal of the bank statements did not reveal any withdrawals of the corresponding amounts near the date of investment or near about period. Therefore, we confirm the order of CIT(A) on these counts. 69. In case of Bh. Narasimha Murthy, the CIT(A) held that this person had not shown any receipts from Tobacco Board or any other person during the FY 2000-01, nor there is appropriate deposit in his bank account during the period. He, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e invited our attention to 7 to 10 pages of the paper book containing affidavit of Shri P. Venkata Rao and copy of land owners rights pass book confirming ownership of 20 acres and 33 cents of fertile agricultural land. The CIT(A) was also of the view that investment in the name of Bharathi, i.e. wife of P. Venkata Rao has been made without Bharathi having owned agricultural land individually and without any bank account in her name and hence cannot be held as genuine. 74. We are in confirmity with the reasoning given by the CIT(A) since there is no evidence in respect of Smt. P. Bharathi holding of any agricultural land or any bank account in her name from which the investment could be explained. 75. Ground No. 3.a) b) are directed against the action of the CIT(A) in sustaining the addition of Rs. 7,95,000/- representing unsecured loans as unexplained credits u/s 68 of the Act. 76. During the year under consideration, the assessee had shown public deposits/other loans amounting to Rs. 1,08,49,597/- under the head unsecured loans . During the scrutiny assessment proceedings on 18/08/2004, the assessee company was asked to furnish the complete list of unsecured loans, their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rarely exceeded Rs. 10,000/- on a single occasion, and the withdrawals were also similar and it is only on two occasions that substantial amounts had been deposited and immediately withdrawn from this amount. He further observed that a person who has a saving bank account will keep money normally in bank, except for small amount of cash to be kept at residence. He, therefore, confirmed the action of the AO in making the addition u/s 68 as unexplained investment on the ground that the said person having no ostensible sources of income. 81. The learned counsel submitted that the loan was given by way of DD by utilizing the joint account of the creditor and her husband and the investment of only Rs. 30,000/-. 82. In case of Smt. K. Subba Laxmi and K. Ramesh, the CIT(A) observed that a loan of Rs. 50,000/- each in the name of these two persons is shown as on 22/11/2000 and had filed copies of MRO certificate for holding the lands in their names and the AO had stated that Mr. Ramesh was only a student who could not file any explanation for the credits in the bank pass book. The CIT(A) held that on perusal of the bank account, copies of which had been filed before the AO, found that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Village, W.G. Dist. 86. In case of G. Srihari, the CIT(A) observed that he is the son of Sri G. Murali Krishna and in the sworn statement recorded on 03/11/2005 by the AO, had stated that he was a post graduate and presently doing agriculture in the village and the loan of Rs. 1 lakh was shown as taken by the company from this person on 26/12/2000. The AO had mentioned in his report that in the year 2000, this person must have been a student and it is not known how he would have earned agricultural income as claimed in his name. After considering the above background, the held that the bank statement is only in the name of Sri G. Muralikrishna and did not contain the name of Sri G. Srihari, the creditor. Moreover, the balance in the account of this person in December, 2000 was hardly Rs. 429/-. The CIT(A) observed that even if it is accepted for argument s sake that the investment had been made by his father, no credible source of investment is found available in this case. He, therefore, confirmed the action of the AO in making addition u/s 68 of the act treating as unexplained investment in the said case also. 87. In the case of Sri G. Srihari, the learned counsel submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... book owning 3 acres 37 cents agricultural land. The counsel submitted that Rs. 50,000/- certified by the MRO was not the only income of the creditor but the creditor has some irregular income which was utilized for his upkeep. In these circumstances, the learned counsel submitted that the addition may be deleted. 92. In case of Smt. K. Shantha Kumar, Sri K. Sandeep and Sri KVK Chaitanya, the CIT(A) observed that all these three persons are shown as having invested Rs. 20,000/- each on 15/01/2001 in the company. Smt. Shantha Kumari, mother of the two persons, Sandeep and Chaitanya, filed an affidavit stating that she was a professional and income tax assessee since 1996, and had made deposits in her own name as well as in the name of her two sons of Rs. 20,000/- each, from the maturity proceeds of UTI growth fund and maturity of peerless investment savings scheme. The CIT(A) further observed that the AO in his report had stated that the source for investment were stated to be out of the gifts received periodically and these persons were children having no idea about advancing of loans/making investments. However, he has accepted the investment in the name of Smt. Shantha Kumari. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rishna Prasad, the CIT(A) observed that the investment is claimed in the month of January, 2001, but, no confirmations had been filed regarding the investments made by these persons in the company. The AO had reported that, except for filing copies of pattedar pass books, no details of worth had been filed either at the assessment stage or at the remand report stage. In view of the above findings, the CIT(A) held that neither these persons had confirmed their investment in the company nor any evidence of earning of income or sources of investment had been filed in the proceedings, therefore, the assessee had not been able to establish either the identity or the creditworthiness of these persons in any manner ad the burden cast on the assessee as per the provisions of section 68 has not been discharged in any of these cases. He, therefore, confirmed the action of the AO in making additions u/s 68 against the said persons. 97. The learned counsel invited our attention to pages 12 to 14 of the paper book to submit that Shri K. Suresh has filed affidavit confirming investment of Rs. 50,000/- in his name and Rs. 50,000/- in the name of his wife K. Neelima by way of cheques. The counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penses for the year and the balance available so that the investors have advanced such a huge amounts as loans to the company. It is also observed by the Assessing Officer that from the confirmations, the mode of payment was by way of Demand drafts and most of the demand drafts were serially numbered and obtained on the same date. Most of the persons have given loans by way of cash or demand drafts even though these persons are having bank accounts. Hence, the Assessing Officer concluded that in the absence of basic details and also credit-worthiness of the depositors/loan creditors not being substantiated with proper evidence, that all the above persons are only name-lenders. 101. The following points clearly show that the investors are advised to invest the unaccounted money in shares: i) All the investors are agriculturists having no other source of income except agricultural income. ii) The amounts deposited by way of cash. iii) The investors have not taken receipt or acknowledgment for the investment made. iv) The investors are not aware of the type of shares in which they have invested. v) Most of them have bank accounts and could have invested ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year also. 109. A similar issue was decided in the Assessee s appeal for the AY 1999-00 at para 47 above. For the same reasons, respectfully following the decision of the Apex Court in the case of Ravindranthan Nair (reported in 295 ITR 228), the AO is directed to recompute the deduction u/s 80HHC(3) of the Act. 110. Ground No. 6 a) b) is directed against the action of the CIT(A) in sustaining the addition of Rs. 48,300/- representing agricultural income as income from other sources . 111. The AO stated that the assessee failed to produce any satisfactory evidence regarding agricultural activities and earning of agricultural income, therefore, he treated the amount of Rs. 48,300/- claimed by the assessee as agricultural income, as income from other sources . On appeal, the CIT(A) confirmed the action of the AO on the ground that there was no evidence of earning of agricultural income. 112. Aggrieved the assessee is in appeal before us. 113. We have heard the arguments of both the parties and perused the record as well as gone through the orders of the authorities below. The CIT(A) has given a categorical finding that no evidence of earning of agricultural income has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nthi (6) G. Srihari (7) G. Seetharamachandra Rao (8) P. Satyanarayana (9) K. Shantha Kumari (10) KRK Murthy (11) K. Sandeep, KVK Chaithanya (12) K.A. Ramaiah (13) K. Subba Laxmi, K. Ramesh (14) S. Satyavathi, were already shown as unsecured loans in AY 2001-02 and added u/s 68 of the Act by the AO. The CIT(A) further observed that the said investments were confirmed by him in AY 2001-02 except Sri G. Seetharama Chandra Rao (Rs. 1 lakh), Smt. N.R. Shantha (Rs. 50,000) and in the case of of Sri K. Shantha Kumari, therefore, investments shown in the name of these persons cannot be again considered as fresh deposits to be considered for addition u/s 68 of the Act. He, therefore, directed the AO to delete the additions made in the name of the said persons, as the same have been already considered in AY 2001-02. 120. As far as investments shown in the name of 14 other persons, which are not reflected in the earlier year, the CIT(A) decided the same as under:- 121. In case of G. Sai Krishna, Ms. G. Navya, Smt. K. Kaveri, the CIT(A) observed that in all these cases, affidavits had been submitted stating that they had received the sum of Rs. 25,000/- each from close ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amounts invested. 128. In cases of BH. Anasuya, BH Madhavi and BH Bhagyalakshmi, the CIT(A) observed that these persons are wife and daughters of one Sri BH Trinadha Rao, who appeared before the AO and stated that these persons made investments out of gifts received from elders on various occasions and no other evidence was filed regarding the investments shown in their name. The CIT(A) held that none of these 3 persons had produced any documentary evidence, regarding their sources of income, out of which, the investment had been claimed and there is a discrepancy also in the earlier statements made, wherein it was stated that the investments were made out of gifts received from elders and in subsequent statement it was stated that they had their own sources of income. In the absence of any credible evidence produced either in the assessment proceedings or in the appellate proceedings, the CIT(A) confirmed the addition of Rs. 1 lakh made by the AO u/s 68 of the Act for investment shown in these names by the assessee. 129. The learned counsel for the assessee invited our attention to the pages 12 to 14 of the paper book containing affidavits by the investors to submit that Smt. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount of Rs. 1 lakh as unexplained credits u/s 68 of the Act in the said case. 131. The learned counsel for the assessee invited our attention to pages 15 to 23 of the paper book containing affidavits by the investors and confirmations by Sri KRK Murthy that he has given gifts to his wife and children out of his retirement benefits. 132. We have heard the arguments of both the parties and perused the record. Similar ground has been raised by the assessee as Ground No. 2.a) b) in AY 1999-2000 in ITA No. 627/Hyd/08 and the same has been decided by us vide paras 24 to 29 (supra). Respectfully following the conclusions drawn therein, we confirm the order of the CIT(A) in sustaining the addition of Rs. 3,55,000/- out of share capital as unexplained credits u/s 68 of the Act, as against the addition of Rs. 14,15,000/- made by the Assessing Officer u/s 68 of the Act for unexplained credits representing share application money. This ground of appeal of the assessee is dismissed. 133. Ground No. 3 a) b) is directed against the action of the AO in sustaining the addition of Rs. 34,750/- representing agricultural income as income from other sources. 134. The AO had treated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 142. Similar ground arose in AY 1999-00 (supra) vide para 40, wherein we have held that the deduction of payment of employees contribution towards provident fund and ESI cannot be disallowed under section 43B, if paid before the due date of filing the return. In view of this fact, we set aside the order of the CIT(A) and restore the issue to the file of the AO to decide the issue with identical directions. 143. Ground N0.5 a) b) is directed against the action of the CIT(A) in confirming the action of the AO in reducing 90% of the job work charges of Rs. 1,40,844/- from profits of business applying clause (baa) of Explanation to section 80HHC of the Act. 144. The AO while computing the deduction allowable u/s 80HHC reduced 90% of job work charges of Rs. 1,40,844/- considering as other income within the meaning of clause (baa) to Explanation to section 80 HHC of the Act. On appeal, the CIT(A) following his decision in AY 2001-02, confirmed the action of the AO. 145. Aggrieved, the assessee is in appeal before us. 146. A similar issue was decided in the Assessee s appeal for the AY 1999-00 at para 47 above. For the same reasons, respectfully following the decisions of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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