TMI Blog2020 (10) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... st, be a default of technical and venial nature. Such omission cannot be held to be so fatal as to merit the penalty of disallowance of deduction under consideration. The view taken by the Commissioner (Appeals) and the ITAT is in consonance with the law laid down by the Hon'ble Apex Court in Hindustan Steel Limited (supra). Accordingly, the substantial question of law 'A' is required to be decided against the Revenue and in favour of the Assessee. Deduction under Section 80IC - AO has held that the profits are not matching with the consumption of the electricity at the said Unit - AO has compared the consumption of electricity in various Units of the Assessee and on such basis, concluded that the profits in respect of the newly established Unit at Nalagarh appeared to be unreasonably high - HELD THAT:- The requirements of customers at Goa Unit are different from those of Daman Unit. The quality of printing, sale value and contribution of Nalagarh Unit is much higher as compared to other units. The products manufactured at Goa Daman are excisable products whereas Nalagarh Unit is excise exempt for 10 years. Moreover the electricity power rate at Goa, Daman a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same was filed inadvertently and, therefore, requires no consideration. 6. We now proceed to consider Tax Appeal No.62/2014 which pertains to the Assessment Year 2006-07. 7. Tax Appeal No.62/2014 was admitted by order dated 1st October, 2014 on the following substantial questions of law : (A) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal, is right in allowing deduction under Section 80IB and under Section 80IC ignoring the fact that the assessee has not furnished properly filled Form No.10CCB report. The statute requires such obligation and it is seen from the 10CCB report that such obligation has not been properly complied with. (B) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal, is right in allowing deduction under Section 80IC amounting to ₹ 2,95,50,892/- ignoring the fact that the Assessing Officer has disallowed deduction under Section 80IC of the IT Act, for Nalagarh Unit on basis of alleged disparity in ratio between consumption of electricity and sales in different assessment years in appellant different Unit ? (C) Whether on the facts and in the circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t rectifiable. In fact, the AO should have granted the Assessee an opportunity for rectifying this omission. 16. Ultimately, the Assessee even prior to the assessment, produced material before the AO, which evidences that each of the Units of the Assessee employed more than 10 workers. This means that there was material before the AO to conclude that the Assessee fulfilled the conditions required for claiming deduction under Section 80IB. In these circumstances, both, the Commissioner (Appeals), as well as the ITAT, were quite justified in directing grant of deduction under Section 80IB to the Assessee. 17. In the case of Hindustan Steel Limited vs. State of Orissa 83 ITR 26 (SC) the Hon'ble Supreme Court has held that mere furnishing of deduction form 10CCB could, at the most, be a default of technical and venial nature. Such omission cannot be held to be so fatal as to merit the penalty of disallowance of deduction under consideration. The view taken by the Commissioner (Appeals) and the ITAT is in consonance with the law laid down by the Hon'ble Apex Court in Hindustan Steel Limited (supra). Accordingly, the substantial question of law 'A' is requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Pradesh due tax advantages. j) The electricity power rates at Goa and Daman are different the power rates at Himachal Pradesh. 20. The AO rejected the aforesaid explanation by observing that the consumption of electricity is increased only by 1497%, but the sales have increased by 7102%. 21. Now, both the Commissioner (Appeals) as well as the ITAT, have quite correctly held that the alleged mismatch between the production and the profits at the various Units as determined by consumption of electricity at such units, cannot be the sole ground for concluding that there has been some unreasonable inflation of profits. The two authorities have held that several factors can contribute to the increased profits and upon consideration of such several factors which were not only pleaded, but made good by the Assessee to conclude that there was no good ground to deny the Assessee deduction under Section 80IC of the Income Tax Act. According to us, the two authorities, having recorded the concurrent findings on this issue, the substantial question 'B' does not deserve to be answered in favour of the Revenue. 22. There is no perversity pointed out in the appreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that AO has not carried out any excise. We find that in the instant case, the AC has not rejected the books of account. We find that there are many reasons for higher electricity consumption, therefore, on this simple disparity the AO cannot disallow the deduction U/s 80IC. We find that the CIT(A) has dealt this issue in detail. Therefore, our interference is not required 24. Again, we find that the view taken by both, the Commissioner (Appeals) as well as the ITAT, is a reasonable view. The findings arrived at by both the authorities are substantially turned out from the material on record. Accordingly, it cannot be said that there is any perversity involved either in recording of the findings, or in the approach adopted by the Commissioner (Appeals) and the ITAT. It will not be possible to answer the substantial question 'B' in favour of the Revenue and against the Assessee. 25. Since Ms. Linhares was unable to point out any documents which were said to have been admitted by the ITAT as new evidences, the substantial question 'C' does not arise and the same is not required to be answered. The subtantial questions of law at 'A' and 'B' ..... X X X X Extracts X X X X X X X X Extracts X X X X
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