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2016 (1) TMI 780 - ITAT AHMEDABAD

2016 (1) TMI 780 - ITAT AHMEDABAD - TMI - Disallowance of deduction u/s.80IB - Held that:- Assessee has been unable to substantiate his claim of deduction u/s.80IB of the Act and therefore, we find it justified to confirm the disallowance made by the Assessing Officer and allow the appeal of the Revenue. - Decided against assessee - ITA Nos. 37 to 39/Ahd/2012 - Dated:- 30-10-2015 - Shri Rajpal Yadav, Judicial Member Shri Manish Borad, Accountant Member For The Revenue : Shri Dipak Sutaria, Sr. D .....

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on behalf of assessee even when the notice of hearing was served through department and therefore the case has been heard on the basis of papers available on record and submissions of ld. D.R. 3. First we take ITA No. 37/Ahd/2012 for A.Y. 2001-02, wherein Revenue has raised following grounds of appeal: 1. The Ld. Commissioner of Income tax (A) has erred in law and on facts in deleting the disallowance of deduction of ₹ 17,29,981/- u/s.80IB of the Act. 2. On the facts and circumstances of t .....

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r A.Y. 2001-02 on 24.10.2001 showing total income at ₹ 1,62,040/- after claiming deduction u/s.80IB of the Act at ₹ 17,29,981/-. The assessee s case was selected for scrutiny and assessment order was framed by Assessing Officer (ITO, Ward 7(4), Ahmedabad) u/s.143(3) of the Act on 30th March, 2004, wherein Assessing Officer disallowed the deduction u/s.80IB of the Act at ₹ 17,29,981/- and disallowed interest charged on interest free advances at ₹ 1,03,072/- and as such ass .....

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e Bench of ITAT vide its order in ITA No.3562/Ahd/2004 dated 17.10.2008 set aside the issue back to the file of Assessing Officer giving following directions: i. To re-decide the issue of allowability of deduction u/s.80IB of the IT Act after giving proper and reasonable opportunity of being heard to the assessee. ii. To re-decide the issue of disallowance of interest on advances of ₹ 1,03,070/- after giving proper and reasonable opportunity of being heard to the assessee. 4.2 Following th .....

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ficer came to the conclusion that assessee is not entitled to deduction u/s.80IB of the Act. 5. Aggrieved assessee went in appeal before the CIT(A). During appellate proceedings before the CIT(A), assessee has only made a written submission giving details of manufacturing process and reference to the report by Chartered Accountant on Form No.10CCB of IT Rules to support his claim of deduction u/s.80IB of the Act. However, assessee did not furnish any details in the form of copies of purchase bil .....

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the Act is allowed in support of profits and gains from certain industrial undertakings other than infrastructure development undertaking. Section 80IB(2)(iv) of the Act reads as under: 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. Assessing Officer want .....

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examine that whether the assessee is entitled to deduction u/s.80IB called for necessary information vide letter dated 27.11.2009 issued during the assessment proceedings initiated as per the decision of Co-ordinate Bench in which the matter was set aside to the file of Assessing Officer. 1. Ledger, journal, sales & purchase invoices and expenses vouchers. 2. Bank pass book/statement, counter parts of cheque book & slip book. 3. Stock register, mfg. register and packing material register .....

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information were submitted for perusal before the Assessing Officer and he has to proceed further as per the records available on file. 7.1 During the assessment proceedings, on examination of tax audit report u/s.44AB of the Act, Assessing Officer noticed that similar items are appearing under the raw material as well as finish goods quantitative details for the year. Taking one example of item P.C.B. for Hi-Fi Music system with components. This item was appearing in the quantitative detail mad .....

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mation of the object or article or thing into a new distinct object or article or thing having a different name, character and use and the available information with the Assessing Officer was not supporting the claim of the assessee that it is carrying on a manufacturing activity. 7.2 Assessee has claimed that it manufactures electronic goods. In his submission before ld. CIT(A), he has mentioned that for the purpose of manufacturing electronic goods, such as, Music Systems, Radio Cassette Recor .....

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rols, different types of soldering wires, A.C. cord wires, batteries etc. These raw material items are assembled and finished goods are manufactured. 7.3 But the quantitative details appearing in the audited balance sheet and tax audit report are not having any mention of the various raw materials claimed to have been used by the assessee in the manufacturing process. Rather only the end product i.e. the finished goods is appearing in the raw material list as well as finished goods list. 7.4 Ass .....

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, wherein Assessing Officer needed the proof of power, connection, power consumption, certificate of small scale industries, wages register and proof of the payments, which were not made available. Due to all the above reasons, Assessing Officer has no other option except to disallow the claim u/s.80IB of the IT Act. 7.6 Thereafter, during appellate proceedings before the CIT(A), no material documents were furnished except the submissions of the manufacturing process in reference to the audit re .....

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ms to be not interested to fight for his claim as he has neither fulfilled the requirements made by the Assessing Officer nor gave any conclusive evidence before the CIT(A) and nor he is appearing before the Tribunal with requisite details and as such, we find it justified to confirm the disallowance made by the Assessing Officer u/s.80IB of the Act and thereby allowing the appeal of the Revenue. 8. Now, we take ITA No. 38/Ahd/2012 for A.Y. 2003-04. Revenue has raised following grounds: 1. The L .....

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dated 17.10.2008 in ITA No.2243/Ahd/2006 has set aside the issue back to the file of Assessing Officer giving directions to re-decide the issue of allowability of deduction u/s.80IB of the Act after giving proper and reasonable opportunity of being heard to the assessee. 9. In view of above direction, fresh notice u/s.143(2) of the Act was issued to the assessee on 18.03.2009 which was duly served upon on 19.03.2009. Further, notice u/s.142(1) of the Act along with questionnaire was also issued .....

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ges register, muster rolls (presence register) alongwith list of all employees with detailed addresses. 6. Contra Accounts from books of account of the creditors and debtors duly signed. 7. Any other documents and evidences produced before the CIT(A) & Hon ble Tribunal during the course of hearing of appeals. In this year also, assessee did not produce any evidence to establish his claim u/s. 80IB of the Act even after a fresh opportunity of being heard was given. We have dealt the similar g .....

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