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TMI Blog2015 (2) TMI 502X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 for the assessment year 1997-98. On 24.09.2007, a Coordinate Bench admitted the appeal on the following substantial question of law : (i)Whether on the facts and in the circumstances of the case, the Tribunal is legally justified in disallowing the claim of Deduction under Section 80 IA at Rs. 1,22,719/-? (ii)Whether on the facts and in the circumstances of the case, six persons working under control and supervision of the assessee, are not employee of the assessee? (iii)Whether on the facts and in the circumstances of the case, disallowance of Staff Welfare Expenditure at Rs. 5,000/- is legally justified? The brief facts of the case are that the assessee company has two units namely M/s. Sai Electricals; and M/s. Sai Computer Consul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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...." (Emphasis is added) The CIT(A) in its order has observed that there were 14 workers serving with the assessee out of which two were the Security Guards. The CIT(A) has also observed that the Security Guard cannot be considered as having been employed in connection with the business of the industrial undertaking and therefore they were excluded. Out of remaining staff, six persons were employed on contract services. These persons were described as contractors and were n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ill get the benefit of deduction under Section 80IA of the Act for the assessment year under consideration for a sum of Rs. 1,43,620/-. The answer to the substantial question nos. 1 and 2 is in favour of the assessee and against the Department. The question no. 3 is related disallowance of Rs. 5,000/-. The assessee has spent a sum of Rs. 16,885/- for tea, coffee, cold drinks, snacks etc. The same was disallowed by the A.O. under Section 37(2) of the Act. Finally, the Tribunal has sustained disallowance of Rs. 5,000/- on estimate basis and given the relief of the balance amount. By considering the totality of the facts and circumstances of the case, it appears that the Tribunal has given the relief on estimate basis, which is a question o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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