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2016 (1) TMI 27 - ITAT AHMEDABAD

2016 (1) TMI 27 - ITAT AHMEDABAD - TMI - Reallocation of expenses incurred amongst Unit-I & Unit- II in proportion to the sales of these units - CIT(A) allowed part relief - Held that:- Given a finding that Assessee has kept separate production record for both the units which indicate the quantitative of raw material consumed and production as per excise law, therefore held that A.O was not justified in re-allocating the expenses in proportion to the sale in both the units. However, with respect .....

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r The Appellant : Shri Narendra Singh, DR For Tbhe Respondent : Shri S. N. Soparkar, AR ORDER PER Manish Borad, Accountant Member. This appeal of the Revenue is against the order of CIT(A) -XIV, Ahmedabad dated 21/6/2012 . Assessment was framed by ACIT, Circle-7, Ahmedabad u/s 143(3) of the I.T. Act, 1961( hereinafter referred to as the Act) vide order dated 23.12.2011. Revenue has raised the following grounds of appeal:- i) The ld. CIT(A) has erred in law and on facts in directing the AO to del .....

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service tax expenses in the ratio of the turnover of both the units. iii) On the facts and circumstances of the case, the ld. CIT(A) ought to have upheld the order of the AO. iv) It is, therefore, prayed that the order of the ld. CIT(A) may be set aside and that of the AO be restored. 2. Briefly stated the facts as culled out from the material on record are that the assessee is a partnership firm involved in the business of manufacturing and trading of synthetic organic reactive dyes and chemic .....

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emption under section 10B. During the year under appeal the assessee has shown profit of ₹ 86.16 lacs from unit no. I and profit of ₹ 4.3 crores from unit no. II. Unit no.I is also engaged in export sales and almost 80% of the revenue comes from the export sale. The AO noticed that profit ratio of unit no.I is 80% and profit ratio of unit no.II (EOU) is 100% which are not comparable and, therefore, during assessment proceedings he called for various information in relation to product .....

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ting into reduction of claim of assessee u/s 10B by ₹ 1,44,72,989/-. 3. Aggrieved, assessee went in appeal before CIT(A), who after going through the submissions made by assessee as well as applying his finding on the basis of CIT(A) s appellate order for AY 2008-09 wherein identical facts were there, partly allowed the appeal of the assessee. Aggrieved, Revenue is now in appeal before the Tribunal. 4. Ld. DR relied heavily on the order of A.O. On the other hand, the ld. AR of the assessee .....

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contentions and gone through the submissions of ld. representatives as well as the material on record. As referred to by the ld. AR, we have gone through the grounds of appeal in ITA No.50/Ahd/2012 for AY 2008-09, which are as under :- 1. The Ld. Commissioner of Income tax (A) has erred in law and on facts in directing the Assessing Officer to delete the addition of ₹ 1,31,16,642/- made on account of reallocation of expenses relating to raw materials, manufacturing expenses, administrative .....

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ve upheld the order of the Assessing Officer. 4. It is, therefore, prayed that the order of the Ld. Commissioner of Income tax (A) may be set-aside and that of the Assessing Officer be restored. Wherein the co-ordinate Bench dismissed the appeal of Revenue by observing as under :- 9. We have heard the rival submissions and perused the material on record. We find that ld. CIT(A) while granting partial relief has noted that similar addition made by the A.O in the preceding year was not approved by .....

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