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TMI Blog2016 (2) TMI 513X X X X Extracts X X X X X X X X Extracts X X X X ..... the ld. CIT(A) went wrong in confirming the trading addition of Rs. 37,768/- of EOU Unit-II by working 25% on un verified purchases amounting to Rs. 1,59,073/- which should be deleted. 2. Regarding ground No.1, the brief facts relevant for the matter under consideration are that the assessee, which is in business of manufacturing and trading of previous and semi-precious stones and studded Diamond jewellery, is having two units, unit-I and unit-II. The unit-II is 100% Export Oriented Unit (EOU) which is eligible for exemption u/s 10B of the Act. During the year under consideration, the assessee has debited an amount of Rs. 5,36,228/- towards Foreign Exhibition Participation expenses in the profit and loss account of unit-I. As per the AO, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the booking amount of booth No. 44103 as per the cancellation policy and as such the amount of Rs. 5,36,228/- represented the cancellation charges of booth No. 44103. 2.2 The ld. DR is heard. 2.3 We have heard the rival contentions and perused the material available on record. Firstly it is noted that the amount of Rs. 5,36,228/- which has been debited in the profit and loss account of unit-I relates to cancellation of participation in the exhibition being organized by the Gem & Jewellery Export Promotion Council due to the business exigencies of the assessee. Secondly, it is noted that the initial deposit of Rs. 9,45,000/- was paid out of the books of accounts of Unit-I as evident from the account of the Gem & Jewellery export promotion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s is that the booking of stalls in the exhibition was done for both the units and the expenses should relate to both units. In light of above, we are of the considered view that the AO has rightly apportioned the foreign participation cancellation expenses in the hands of both the units and necessary additions/ disallowances have been made in the hands of the respective units. Hence the ground of appeal taken by the assessee is dismissed. 2.4 Regarding ground No.2, the same relates to proportionate addition of Rs. 37,768/- in hands of unit-II which is 100% EOU @ 25% of unverifiable purchases. We have gone through the submissions of the ld. AR as well as the order of the lower authorities. Given that the said disallowance relates to unverif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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