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TMI Blog2013 (12) TMI 1559X X X X Extracts X X X X X X X X Extracts X X X X ..... 26/- made b the A.O. The Ld. CIT(A) failed to appreciate that this amount was paid on account of contributions towards employees Provident Fund which was duly paid before the due date of filing the return of income and as such the same should have been allowed as business expenditure. 3. Again, the Ld. CIT(A) has grossly erred in confirming the disallowance of Rs. 13,74,074/- made by the AO on account of profits attributable towards installation and testing charges of DG sets u/s 80IB(4) on the basis that the same is not derived from industrial undertaking. The Ld. CIT(A) failed to appreciate that the said charges were part and parcel of our sale products and sale is only completed after testing and installation of the DG sets in the prem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ees contributions of Provident Fund on or before the 15th of the following month, which the assessee has failed to do to the extent of Rs. 44,626/- and accordingly the assessee has violated the provisions of section 36(1)(va) of the Act and the same was added to the income of the assessee. 3.1. The Ld. counsel for the assessee, Mr. P.N.Arora, Advocate, at the outset relied upon the decision of the ITAT, Amritsar Bench in the case of DCIT, Cir.1, Jammu vs. M/s. TRG Industries Pvt. Ltd. Jammu, in ITA Nos. 483 & 484(Asr)/2011 for the assessment years 2003-04 & 2004-05 dated 08.06.2011, where on identical issue, it has been held that that if the employees provident fund is paid before the due date of filing the return, no addition can be made. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee has claimed deduction u/s 80IB of the Act. In response to show cause notice from the AO, the assessee has submitted as under: "That regarding installation charges of Rs. 13,74,074/- for which deduction u/s 80IB claimed, in this regard it is submitted that assessee is engaged in manufacturing and sales of Generating set of various capacities. Because installation is an inseparable part of the sale transaction. The sale bill be complete only when the generating sets are installed/commissioned strictly in accordance with the specification provided by the purchasing party. For the purpose of installation various material are required same has been purchased and debited to the purchase A/c. The amount on these transactions has been cred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble for deduction u/s 80IB of the Act. 8. The Ld. DR, on the other hand, relied upon the orders of the authorities below. 9. We have heard the rival contentions and perused the facts of the case. On perusal of the record and the contract placed on record, we are of the view that in the present case, the assessee has supplied DG sets to the customers which includes installation, testing and commissioning, which is intricate and inseparable part of manufacturing activity and therefore, any surplus arising therefrom shall be termed as derived from an industrial undertaking and eligible for deduction u/s 80IB of the Act Accordingly, the order of the Ld. CIT(A) is reversed and the AO is directed to allow deduction u/s 80IB of the Act to the tu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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