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Income Tax Officer, Ward-2, Navsari Versus Gandevi Taluka Khedut Sahakari Sangh Ltd.

2015 (10) TMI 407 - ITAT AHMEDABAD

Addition in respect of Administrative & managerial expenses related to non-agricultural activities - CIT(A) deleted the addition - Held that:- As decided in assessee's own case for A.Y. 2007-08 on the similar issues CIT(A) has stated that separate books of accounts were maintained, but the basis of his above finding has not been stated in the order. From the order of the CIT(A), it cannot be ascertained as on verification of which material the CIT(A) has arrived at the above findings. Further, b .....

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so deduction u/s. 80P does not apply, but the basis of above finding of the CIT(A) is not clear from his order. In the above circumstances, in our considered view, it shall be in the interest of justice to restore the issue back to the file of the Assessing Officer for proper verification and thereafter adjudicating the issue afresh by passing a speaking order. We, therefore, set aside the orders of the lower authorities on this issue and direct the Assessing Officer to re-adjudicate the issue .....

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the date of hearing an adjournment application dated 26th August, 2015 was filed by ld. A.R. requesting for an adjournment for the reason as that date is not convenient to me . Considering the reason for the adjournment to be not justifiable, we dismiss the adjournment application filed by ld. A.R. and proceed to decide the issue on merits ex-parte qua the Assessee. 3. The relevant facts as culled out from the material on record are as under. 4. Assessee is stated to be a Co.op. Society register .....

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e order of A.O., Assessee carried the matter before ld. CIT(A) who vide order dated 26.08.2011 decided the issue in favour of the Assessee. Aggrieved by the aforesaid order of ld. CIT(A), Revenue is now in appeal before us and has raised the following grounds:- 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A), Valsad, without appreciating the facts, has erred in deleting the addition of ₹ 45,67,085/- in respect of Administrative & managerial expenses rela .....

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76 TAXMAN 245 (Raj.) to tax the profit earned from non-agricultural activities and interest from nationalized bank. 5. During the course of assessment proceedings, A.O noticed that Assessee had claimed deduction u/s. 80P(2) of the Act. He also noticed that Assessee was engaged in agricultural and non-agricultural activities like trading in agricultural equipments, seeds, pesticides etc. and the sales of the Assessee were both to the Members of the Society and also to the non members. He also not .....

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ed to maintain separate books of accounts but however Assessee was maintaining composite accounts for exempt income as well as non exempt income. He was therefore of the view that provisions of Section 14A to be applicable. He therefore following Rule of 3, provision of Section 14A and the ratio of the decisions of High Courts, cited in his order reworked the deduction. Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who following the order in Assessee s own case fo .....

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te Order in Appeal No. CIT(A)/VLS/276/09-19 dated 30.11.2010 in favour of the appellant. Following the said order, the A.O is directed to allow the appeal of the appellant. Thus, this ground of appeal is allowed. 6. Aggrieved by the aforesaid order of ld. CIT(A), Revenue is now in appeal before us. 7. Before us, at the outset, ld. D.R. submitted that in A.Y. 2007-08 on identical issue, the matter was remitted by Tribunal to ld. A.O. He therefore submitted that since the facts of the case are ide .....

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eal before Tribunal. The Co-ordinate Bench of Tribunal in ITA No.813/Ahd/2011 order dated 12.12.2014 decided the issue by holding as under:- 5. We find that the Assessing Officer has stated that no separate books of accounts were maintained for agricultural activities and non-agricultural activities and therefore, the total administrative expenses and interest expenses are to be apportioned in respect of the said activities to ascertain the income from the activities which are exempt u/s 80P of .....

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the basis that one trading account and one P&L account was filed before him. In our considered opinion, merely because one consolidated trading account or P&L Account has been prepared, it cannot be concluded that separate books of accounts in respect of eligible activities and non-eligible activities were maintained or not. 6. Further, though the CIT(A) has stated that separate books of accounts were maintained, but the basis of his above finding has not been stated in the order. From .....

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