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The Deputy Commissioner of Income Tax, Corporate Circle 2, Madurai Versus M/s. The Metal Powder Co. Ltd.

2016 (9) TMI 994 - ITAT CHENNAI

Claim under section 80IB - non setting off of the losses against the profits of the Aluminium Paste Unit - Held that:- Each unit has to be separately considered for working out deduction under section 80IA or 80IB or 80HHC of the Act once separate accounts were being maintained and there was no interlacing and interdependence. In the instant case, the assessee has been maintaining separate accounts for its different units. Therefore, respectfully following the decision of the Coordinate Bench of .....

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rai dated 27.11.2015 relevant to the assessment year 2011-12. The only effective ground raised by the Revenue is that the ld. CIT(A) has erred in holding that the claim under section 80IB of the Income Tax Act, 1961 [ Act in short] is to be granted without setting off of the losses against the profits of the Aluminium Paste Unit. 2. Brief facts of the case are that the assessee is engaged in the business of manufacture and sale of metallic powders. The assessee filed its return of income on 29.0 .....

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he Act on 26.03.2014 by assessing total income of the assessee at ₹.22,74,09,450/- after making various disallowances. 3. The assessee carried the matter in appeal before the ld. CIT(A). After considering the submissions of the assessee and also facts of the case, the ld. CIT(A) partly allowed the appeal filed by the assessee. 4. On being aggrieved, the Revenue is in appeal before the Tribunal. The ld. DR has submitted that the gross total income as defined under section 80B(5) of the Act .....

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td. v. Assessing Officer 299 ITR 444 (SC). 5. On the other hand, the ld. Counsel for the assessee has submitted that the issue involved in this appeal is squarely covered in favour of the assessee by the decision of the Tribunal in assessee s own case for earlier assessment year and supported the order passed by the ld. CIT(A). 6. We have heard both sides, perused the materials on record and gone through the orders of authorities below. We have also perused the copy of the order of the Tribunal .....

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risdictional High Court, the Tribunal has observed and held as under: 7. We have perused the orders and heard the rival submissions. For all the impugned years, what we note specifically from the orders of ld. CIT(Appeals) is that gross total income of the assessee was positive. Assessee had no carried forward loss of earlier years as well. That gross total income for all the impugned assessment years was positive, was not disputed by the learned D.R. Further, assessee had returned positive tota .....

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answered by Hon'ble jurisdictional High Court in their decision in the case of Chamundi Textiles (Silk Mills) Ltd. v. CIT (341 ITR 488). There the question was regarding claim of deduction under Section 80HHC and whether such deduction could be allowed without considering the results of a unit, which was not having any profits. It was held by their Lordships that by virtue of the decision of Hon'ble Apex Court in the case of IPCA Laboratories Ltd. v. CIT (266 ITR 521), undisputedly only .....

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s total income computed as per the provisions of the Act. This was clearly reiterated by Hon'ble Apex Court in the case of Synco Industries Ltd. (supra). Hon'ble Apex Court held that gross total income had to be arrived at after making deductions as per appropriate computation provisions, including income under Sections 60 to 64, adjustment of inter se losses and after setting off brought forward losses and unabsorbed depreciation. Only if resultant gross total income was positive, an as .....

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us activities, even if centralized accounts are maintained, so long as interlacing, interconnectivity or interdependence of various units was not there, various activities have to be treated as separate and distinct, as held by Hon'ble Apex Court in the case of Water Fall Estates Ltd. v. CIT (219 ITR 563). Hon'ble Apex Court in the case of L.M. Chhabda & Sons. v. CIT (65 ITR 638) has also held that where an assessee carried on business ventures at different places, there was no gener .....

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