TMI Blog2011 (8) TMI 1242X X X X Extracts X X X X X X X X Extracts X X X X ..... eard and records perused. The facts in brief are that the assessee is engaged in trading of shares, securities and equity mutual funds of various mutual funds schemes. The assessee is also engaged in manufacturing selling of soft drink concentrate under a proprietary concern namely Jaffe Manufacturing Company. In the A.Y. 2003-04, the assessee has claimed deduction u/s. 80IB amounting to ₹ 1,14,41,702/- which is 25% of the profit of ₹ 4,57,66,806/-. A survey was carried out u/s. 133A at the factory and office premises of the assessee on 21.2.2006. The factory premises of the assessee M/s. Jaffe Manufacturing Company were closed. During survey certain loose papers and documents and attendance registers relating to manufacturing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Trivedi who should have prepared labour and ESI records on the basis of actual muster rolls submitted to him by the Supervisor of the factory. However, Sh. Trivedi included some more names in the muster and salary register prepared by him. Sh. Trivedi admitted that the loose muster sheets prepared by the factory supervisor shows the correct number of workers working in the factory and the actual number of workers were only 5-6 except in three months of the season i.e. February, March April when the number was more. The A.O., therefore, held that in view of these discrepancies, the assessee was not fulfilling the basic condition of employing more than 10 workers in the manufacturing process. Accordingly deduction claimed u/s. 80IB was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... muster roll sheets and held that the number of workers was less than 10 and hence the deduction u/s. 80IB was denied. The A.O. did not accept the contentions of the appellant during the assessment proceedings. The main argument of the appellant is that the manufacturing unit had two divisions namely manufacturing and bottle washing unit. The muster roll sheets contain only the names of workers engaged in manufacturing division. The names of the workers engaged in the bottle washing unit are not mentioned in the muster roll sheets. The wages register and the attendance register contain the name of the workers of both the unit. There were 4 workers engaged in the bottle washing unit. The appellant has supported his contention with the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epted by the appellant as correct. The only difference is that the muster rolls sheets do not contain the names of all the workers. The names of workers in the bottle washing unit are not entered in the muster rolls. The AO is not justified in rejecting the evidences and arguments of the appellant. The statements of the different persons have been interrupted by the AO in a particular manner which is not correct. It is held that the appellant had employed more than 10 workers during the year which fulfills the condition as per Section 80IB regarding the number of workers. The appellant is entitled to deduction u/s. 80IB. The addition made by the AO by disallowing deduction u/s.80IB is deleted. This ground of appeal is allowed. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elied did not contain the names of the workers. The name of workers engaged in bottle washing unit were not entered into muster roll, however, in the wages register and attendance register the names of all these workers were duly mentioned. The detailed finding recorded by the CIT (A) has not been controverted by the department by bringing any positive material on record to this effect. Accordingly, we do not find any reason to interfere in the finding recorded by the CIT (A) thereby treating the assessee as illegible for claim of deduction u/s. 80IB on the basis of number of workers employed in its Industrial Undertaking. 7. In the result ground taken by the revenue in both the years are dismissed. 8. The next ground of the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of section 80IA(5) /80IB(13) the profits and gains of an eligible business to which provisions of sub-section (1) apply shall, for the purpose of determining the quantum of deduction for the assessment year immediately succeeding the initial assessment year or in subsequent assessment year, be computed as if such eligible business where the only source of income of the assessee during the previous year relevant to the initial assessment year and to every subsequent Assessment year upto the date and including the assessment year for which the determination is to be made. Sub-section (13) of section 80IB provides that provisions contained under sub-section 5 of 80IA will apply to the eligible business under this section. Sub-section (5) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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