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TMI Blog2012 (5) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in law and on facts in deleting the addition of ₹ 25,13,417/- made on account of disallowance of claim of deduction u/s.80IB of the IT Act. 2. On the facts and in the circumstances of the case. The Ld. Commissioner of Income-tax (A), Gandhinagar ought to have upheld the order of the Assessing Officer. 3. It is, therefore, prayed that the order of the Id. Commissioner of Income-tax, Gandhinagar may be set aside and that of the Assessing .Officer be restored." 2. In the cross objection filed by the assessee, the grounds raised by the assessee are that Ld. CIT(A) has erred in not allowing entire deduction of ₹ 29,85,313/- claimed by the assessee u/s 80-IB and restricting the same to ₹ 25,36,658/-. 3. Brief fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble profits for the purpose of deduction u/s.80IB. The method adopted by-the Assessing Officer was to compute the profit in the ratio of sales' turnover of Unit-IV to the total sales turnover of the company. Consequently, the said eligible profit was worked out at ₹ 18,91,873/-. Further, the non-eligible profits pertained to "other income" was worked out at ₹ 3,18,884/- and thereby the resultant amount of deduction available U/S.801B was worked out at ₹ 4,71,896/-." 4. Being aggrieved, the assessee carried the mater in appeal before Ld. CIT(A) who has held that the assessee is eligible for deduction u/s 80-IB to the extent of ₹ 25,35,658/-. He directed the A.O. accordingly. Now, the revenue is in appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t would ₹ 25.37 lakhs after considering the depreciation as per the IT. Act. The computation provided by-him is as follows: Sr: No Particulars » Unit-HI Less 11.25% * Unit-IV Net Unit-HI Unit-IV (A) 1. INCOME Sales 217,389,870 217,389,870 27,529,01 2 Increase Decrease Stock 10,709,117 10,769,117 5,485,820 3 Other income 11,066,763 11,066,763 129,58 Total 217,747,516 217,747,516 22,172,78 (B) 1 EXPENDITURE Material Consumed 132,702,728 132,702 728 6,439,262 2. Interest & Finance Charges 10,752,393 10,752,393 8,16714 3. Depreciation & Bal. Written Off 8,434,511 8,434,511 1,758,651 4.' Employee's Emoluments 5,582,681 5,582,681 648,766 5. Employee's Emoluments • 1,708 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lary expenses were allocated to the expenses of Unit IV and to this extent, expense of unit III were reduced and as a result, the profit of unit III gone up and profit of Unit IV went down. It is also noted by the Ld. CIT(A) in para 2.4.1 of his order that the expense which are allocated by the assessee to unit IV as per the revised working are either indirect and over head expense or the expenses relating to marketing, production and director's salary which has been charged either to unit III or Bombay Project office but the same is required to be charged proportionately to unit IV also. In the revised working only this adjustment was done by the assessee itself and, therefore, on this aspect, the order of Ld. CIT(A) is reasonable in the f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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