TMI Blog2011 (5) TMI 969X X X X Extracts X X X X X X X X Extracts X X X X ..... r. 2. First we shall take up the appeal of the assessee for assessment year 2003-04 being ITA No. 3111/Mum/2007. Ground No. 1 is general seeking no specific decision from us. 3. In ground No.2 of this appeal, the assessee has challenged the action of the learned CIT(Appeals) in upholding the order of the AO allocating the expenses amounting to ₹ 3,89,818/- pertaining to Mumbai Unit to Banaskatha unit at Gujarat for the purpose of computing deductions u/s 80IB. 4. The assessee in the present case is a company which has two manufacturing units one at Mumbai and other at Banaskatha, Gujarat. The unit at Banaskatha, Gujarat is eligible for deduction u/s 80IB and while computing the profit of the said unit for the purpose of allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d from the eligible undertaking as held by the coordinate bench of this Tribunal in the case of DCW Ltd. vs. Addl. CIT 37 SOT 322 relied upon by the learned counsel for the assessee. However, as held by another coordinate bench of this Tribunal in the case of ACIT vs. Asea Brown Boveri Ltd. 110 TTJ (Mum.) 502, the profit derived from the eligible undertaking for the purpose of deduction u/s 80IA/80IB are the net profits derived from the eligible undertakings and such net profit has to be worked out after deducting all expenses, direct or indirect. As further held by the Tribunal in the case of Asea Brown Boveri Ltd., head office expenses or expenses which are common to all the units will have to be spread over and charged against the receip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld the impugned order of the learned CIT(Appeals) on this issue and dismiss ground No.3 of the assessee s appeal. 8. Ground Nos. 4 and 5 raised by the assessee in this appeal read as under : 4. The Ld. (CIT(A) erred in confirming the action of the Ld. Assessing Officer in disallowing the deduction under section 80HHC of the Act by holding that the appellant is not entitled to deduction under section 80HHC of the Act if it has been allowed any other deduction under chapter VIA. The Ld. Assessing Officer has disallowed the deduction by wrongly interpreting the provisions of section 80IA(9) r.w.s. 80IB(13) of the Act. Therefore the disallowance of deduction u/s 80HHC on the profits of Banaskatha unit at Gujarat is not at all justified a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... VI-A do not exceed 100% of the profits of he business of the assessee. Our above view is also supported by the C.B.D.T. Circular No. 772 dated 23-12-1998, wherein it is stated that Section 80IA(9) has been introduced with a view to prevent the tax-payers from claiming repeated deductions in respect of the same amount of eligible income and that too in excess of the eligible profits. Thus, the object of Section 80IA(9) being not to curtail the deductions computable under various provisions under heading C of chapter, it is reasonable to hold that Section 80IA(9) affects allowability of deduction and not computation of deduction. To illustrate, if ₹ 100/- is the profits of the business of the undertaking, ₹ 30/- is the profits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decided by us in the foregoing portion of this order. Following the said decision rendered in assessment year 2003-04, we uphold the impugned order of the learned CIT(Appeals) on this issue and dismiss ground No.2 of the assessee s appeal. 14. As regards ground No.3, it is observed that the issue raised therein relating to the deduction u/s 80HHC is similar to the one involved in ground No.4 of the assessee s appeal for assessment year 2003-04 which has already been decided by us in the foregoing portion of this order. Following our decision rendered in assessment year 2003-04, we restore this issue to the file of the AO for the limited purpose of recomputing the deduction allowable to the assessee u/s 80HHC keeping in view the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X
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