ITO, New Delhi V. M/s Goldwin Technologies Pvt. Ltd., New Delhi

ITA 1507/DEL/2011

• Counselvise Citation: 150720114 RSA 2011
• Duration Of Justice: 2 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 26-08-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 28-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SATPAL SINGH
• Keywords: Business expenditure
• Section: 143(3); 142(1); 133A; 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH C: NEW DELHI) BEFORE SHRI S.V.MEHROTRA,ACCOUNTANT MEMBER VS. SHRI I.C. SUDHIR, JUDICIAL MEMBER ITA NO.1507 /DEL/ 2011 (ASSESSMENT YEAR :2007-08) ITO VS. GOLDWIN TECHNOLOGIES PVT. LTD. WARD-12(2), ROOM NO. 337 80/2, JEEWAN NAGAR, C.R. BUILDING BALA SAHIB GURUDWARA ROAD NEW DELHI NEW DELHI AABCG2205R AABCG2205R (APPELLANT) (RESPONDENT) ASSESSEE BY :SHRI SATPAL SINGH, SR. DR. REVENUE BY : SHRI R.S.SINGHVI. C .A ORDER PER I. C. SUDHIR, JUDICIAL MEMBER: THE REVENUE HAS QUESTIONED FIRST APPE LLATE ORDER ON THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.51,35,067/ - ON ACCOUNT DISALLOWANCE OF 20% OUT OF THE PERSONNEL, MANUFACTU RING AND OTHER EXPENSES DUE TO NON PRODUCTION OF BOOKS OF AC COUNT. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE C IT(A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB OF THE I.T. AC T IGNORING THE FACTS THAT THE ASSESSEE DOES NOT FULFILL THE RE QUIREMENTS OF SECTION 80IB. ITA NO. 15 07/DEL.2011 2 2. WE HAVE HEARD AND CONSIDERED THE ARGUM ENTS ADVANCED BY THE PARTIES IN VIEW OF ORDERS OF THE AUTHORITIES BELOW, MATERIA L AVAILABLE ON RECORD AND THE DECISIONS RELIED UPON. 3. THE RELEVANT FACTS ARE THAT THE ASSESS EE COMPANY IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND TRADING OF TELEVISION SETS AND HAS MANUFACTURED UNITS AT LUDHIANA, JAMMU AND MANDI DISTRICT OF HIMA CHAL PRADESH. IT HAS BEEN CLAIMING DEDUCTION U/S 80 IB ON ITS INCOME FROM LUD HIANA AND MANDI UNITS AND DEDUCTION U/S 80 IC ON ITS INCOME FROM JAMMU UNIT. DURING THE ASSESSMENT YEAR UNDER CONSIDERATION, THE ASSESSEE DID NOT CLAI M ANY DEDUCTION UNDER CHAPTER VI A ON ACCOUNT OF ITS NEGATIVE INCOME BUT IT HAD RESERVED A RIGHT TO CLAIM DEDUCTION U/S 80 IB AMOUNTING TO RS.13,28,755 /- AND 80 IC AMOUNTING TO RS.63,819/-. DURING THE PERIOD RELEVANT TO THE ASS ESSMENT YEAR UNDER CONSIDERATION A SURVEY U/S 133A OF THE I.T ACT WAS CONDUCTED BY THE A.O- MANDI ON 4/9/2006 TO VERIFY THE ASSESSEES COMPLIAN CE TO VARIOUS PROVISIONS OF TDS/FBT AND IT WAS NOTED BY THE SURVEY TEAM THAT TH E ASSESSEE WAS NOT MANUFACTURING OR PRODUCING ANY ARTICLE OR THING BUT ONLY ASSEMBLING THE TELEVISION SETS. IT WAS ALSO FOUND BY THE SURVEY T EAM THAT NO REGULAR BOOKS OF ACCOUNTS WERE BEING MAINTAINED BY THE ASSESSEE AT I TS UNIT AT MANDI AND THE ENTIRE BUSINESS OPERATIONS WERE CONDUCTED BY A SKEL ETON STAFF WHICH WAS MOSTLY UNQUALIFIED TO UNDERTAKE ANY SPECIALIZED JOB. THE CASE OF THE ASSESSEE ITA NO. 15 07/DEL.2011 3 ACCORDINGLY WAS PICKED UP FOR SCRUTINY TO VERIFY TH E VERACITY OF THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80 IB. IN THE ASSESSMEN T FRAMED U/S 143(3) OF THE ACT, THE AO DISALLOWED 20% OF THE CLAIMED EXPENSES AT RS.2,56,75,337/- RESULTING INTO THE ADDITION OF RS.51,35,067/- ON AC COUNT OF DISALLOWANCE OF CLAIMED EXPENSES ON THE BASIS THAT BOOKS OF ACCOUNT S AND DOCUMENTS WERE NOT MADE AVAILABLE IN SUPPORT OF THE CLAIM. THE LD. CI T (A) HAS DELETED THE SAME WHICH HAS BEEN QUESTIONED BY THE REVENUE IN GROUND NO. 1 OF THE APPEAL. THE AO ALSO HELD THAT THE ASSESSEE IS NOT ELIGIBLE FOR THE DEDUCTION U/S 80 IB FOR MANDI UNIT AND DEDUCTION U/S 80 IC FOR JAMMU UNIT A S NO MANUFACTURING ACTIVITY WAS CONDUCTED BY THE ASSESSEE IN BOTH THE UNITS. THE LD. CIT (A) HAS, HOWEVER, HELD THAT THE ASSESSEE WAS ELIGIBLE FOR TH E DEDUCTION UNDER SECTIONS 80 IB & 80 IC OF THE ACT. THIS DECISION OF THE LD. CI T(A) HAS BEEN QUESTIONED BY THE REVENUE IN GROUND NO.2. GROUND NO-1 4. THE ASSESSEE HAD CLAIMED EXPENSES IN PE RSONAL NATURE AT RS.46,36,381/- AND ON ACCOUNT OF MANUFACTURING AND OTHER EXPENSES AT RS.2,10,41,956/- WAS CLAIMED. THE AO DISALLOWED 20% OF THE CLAIMED EXPE NSES (RS.2,56,75,337/-) RESULTING INTO DISALLOWANCE OF RS.51,35,067/- ON TH E BASIS THAT BOOKS OF ACCOUNTS AND DOCUMENTS IN SUPPORT OF THE CLAIM WERE NOT MADE AVAILABLE. THE LD. CIT(A) HAS DISCUSSED THE ISSUE IN DETAILS AND H AS DELETED THE DISALLOWANCE ITA NO. 15 07/DEL.2011 4 MADE BY THE A.O WITH THIS FINDING THAT SUFFICIENT M ATERIALS WERE MADE AVAILABLE IN SUPPORT OF THE CLAIM BEFORE THE ASSESSING OFFICE R AND PAST HISTORY OF THE CASE ALSO SHOWS THAT THERE IS NO IRREGULARITY IN THE CLA IM OF EXPENDITURE AND DISALLOWANCES MADE IN THE ASSESSMENT YEARS 2004-05 & 2001-02 HAVE BEEN DELETED BY THE FIRST AND SECOND APPELLATE AUTHORITI ES. HE NOTED FURTHER THAT THE EXPENDITURE UNDER THE SAME HEADS HAS ALSO DECREASED . 5. IN SUPPORT OF THE GROUND THE LD. DR HAS BASICALLY PLACED RELIANCE ON THE ASSESSMENT ORDER, WHEREAS THE LD. AR HAS TRIED TO JUSTIFY THE FIRST APPELLATE ORDER ON THE ISSUE. HE REITERATED SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW IN THIS REGARD. 6. HAVING GONE THROUGH THE ORDERS OF T HE AUTHORITIES BELOW, WE FIND THAT THE ASSESSEE HAD BEEN FULLY COOPERATIVE WITH THE AS SESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS. THE ASSESSEE HAD ALSO FURNISHED DOCUMENTS IN SUPPORT OF THE CLAIMED EXPENSES TIME TO TIME AS REQUIRED BY THE ASSESSING OFFICER. SO FAR AS PRODUCTION OF BOOKS OF ACCOUNTS BEFORE THE ASSESSING OFFICER IS CONCERNED, THE LD. CIT (A) HAS NOTED THAT ON 14/ 12/2009 THE ASSESSING OFFICER FOR THE FIRST TIME ASKED THE ASSESSEE TO PR ODUCE THE BOOKS OF ACCOUNTS ON THE NEXT DATE OF HEARING. ON THE NEXT DATE OF HEAR ING COMPLETE BOOKS OF ACCOUNTS AVAILABLE WITH THE ASSESSEE WERE PRODUCED BEFORE THE A.O FOR VERIFICATION. THE A.O DID NOT VERIFY THE BOOKS OF ACCOUNTS FURNISHED BEFORE HIM ITA NO. 15 07/DEL.2011 5 ON THAT DATE ON THIS REASON THAT ASSESSMENT FILE WA S WITH THE INSPECTOR FOR VERIFICATION AND CHECKING THE DETAILS WITH THE RECO RD AND BOOKS OF ACCOUNTS SEIZED/RETAINED AT MANDI UNIT DURING SURVEY OPERATI ON. THE AO, HOWEVER INFORMED THE ASSESSEE THAT THERE WERE SOME DISCREPA NCIES IN THE STOCK DETAILS BUT COULD NOT STATE IN SPECIFIC TERMS AS TO WHAT TY PE OF DISCREPANCIES WERE THERE AND THE ASSESSSE WAS ASKED TO COME ON NEXT DATE. O N THAT DAY ALSO THE INSPECTOR WAS NOT AVAILABLE. THE AO PROVIDED THE ASSESSEE WI TH A PRINT OUT FROM COMPUTER OF STATEMENT OF ALLEGED DISCREPANCIES. TH E ASSESSEE MADE REPLY THERETO. FURTHER CLARIFICATION REGARDING STOCK TRA NSFER WAS SOUGHT BY THE AO FROM THE ASSESSEE WHICH WAS EXPLAINED ON 29/12/2009 . AT THAT TIME AO AGAIN ASKED THE ASSESSEE TO BRING THE BOOKS OF ACCOUNTS. THE ASSESSEE REQUESTED FOR ADJOURNMENT OF ONE DAY TO PRODUCE THE BOOKS ON NEXT DAY WHICH WAS REJECTED ON THE GROUND THAT THE CASE WAS BECOMING TIME BARRE D. THE AO THEREAFTER FRAMED ASSESSMENT DISALLOWING 20% OF THE CLAIMED EX PENSES. NOTING THE ABOVE STATED MATERIAL FACTS AND CIRCUMSTANCES IN TOTALITY THE, LD. CIT(A) HAS DELETED THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF THE CLAIMED EXPENSES @ 20%. RELEVANT PARA NOS. 4.2 TO 4.6 OF THE FIRST APPELLAT E ORDER ARE BEING REPRODUCED HEREUNDER FOR A READY REFERENCE:- 4.2 AGAINST THE DISALLOWANCE MADE THE LD. COUNSEL SUBMITTED THAT THE APPELLANT IS MAINTAINING BOOKS OF ACCOUNT IN TH E NORMAL COURSE OF BUSINESS AS WELL AS STATUTORY REGISTER AND RECOR DS REQUIRED UNDER THE COMPANIES ACT, VAT/CST ACT, SERVICE TAX ACT/CEN TRAL EXIDE ITA NO. 15 07/DEL.2011 6 ACT AND VARIOUS LABOUR LAWS WHICH HAVE BEEN SUBJECT ED TO STATUTORY CREDIT AND ARE ALSO VERIFIED CHECKED BY V ARIOUS DEPARTMENTS LIKE SALES-TAX ETC. DURING THE ASSESSME NT PROCEEDINGS ALL DETAILS /DOCUMENTS OF ALL THE MAJOR EXPENSES AS REQUIRED BY THE EARLIER ASSESSING OFFICER I.E. DY CIT CIRCLE 12(1) ALONG WITH OTHER DETAILS SUCH AS BANK RECONCILIATION STATEMENT, COPI ES OF BANK ACCOUNTS / BANK 10ANS, DETAIL OF ADDITION TO FIXED ASSETS AND PROOF OF PAYMENT OF STATUTORY DUES OUTSTANDING AS ON 31.3 .2007 WERE ALSO FILED. THE ASSESSING OFFICER RECONCILED THE DETAILS OF VARIOUS EXPENSES COVERED UNDER THE PROVISION OF TDS WITH TH E TDS RETURNS AND TDS DEPOSITED. 4.3 IT WAS SUBMITTED THAT SUBSEQUENTLY THE ASSESSM ENT PROCEEDINGS WERE TRANSFERRED TO ITO WARD 12(2) AS THE SEIZED MA TERIAL AND BOOKS OF ACCOCL1T WERE FOUND, TO BE WITH ITO WARD 1 2(2). THE NEW AO ISSUED A FRESH NOTICE U/S 142(1) AND ASKED F OR THE VARIOUS DETAILS/DOCUMENTS OF ROUTINE AS WELL AS SPECIFIC NA TURE. THE COMPLETE DETAILS, AS ASKED, WERE FILED AND EXPLANAT ION GIVEN VIDE LETTER DATED 27.11.2009. FURTHER SOME MORE DETAILS WERE REQUIRED BY THE AO, SUCH AS VAT RETURNS, QUANTITATIVE DETAIL S, DETAIL OF CLOSING STOCK AND LEDGER COPY OF ESI AND EPF WERE A LSO PROVIDED ON 14.12.2009. ON THIS -DATE THE LD AO FOR THE FIRS T TIME ASKED THE APPELLANT TO P'F9DUCE THE BOOKS OF ACCOUNT ON THE N EXT HEARING. 4.4 ON THE NEXT HEARING THE COMPLETE BOOKS. OF ACC OUNT AVAILABLE WITH THE APPELLANT WERE PRODUCED FOR VERIFICATION. HOWEV ER THE AO INFORMED THE APPELLANT'S AR THAT THE ASSESSMENT FIL E WAS WITH THE INSPECTOR FOR VERIFICATION AND CHECKING OF DETAILS WITH THE RECORD AND BOOKS OF ACCOUNT SEIZED I RETAINED AT MANDI UNI T DURING SURVEY OPERATION. THE AO FURTHER INFORMED THAT WERE SOME D ISCREPANCIES IN THE STOCK DETAILS. HOWEVER THE AO COULD NOT STAT E THE DISCREPANCIES FOR THE REASON THAT THE FILE WAS' WIT H THE INSPECTOR WHO WAS NOT AVAILABLE IN THE OFFICE AND REQUESTED T HE AR TO COME ON NEXT DAY. ON THAT DAY , ALSO THE INSPECTOR WAS N OT AVAILABLE. HOWEVER THE, AO PROVIDED THE AR WITH A PRINTOUT FRO M COMPUTER OF STATEMENT OF ALLEGED DISCREPANCIES. IT WAS SUBM ITTED THAT A DETAILED T:EPLY TO THE DISCREPANCIES POINTED OUT BY THE AO WAS FILED AND THE AO FURTHER ASKED FOR CERTAIN CLARIFICATIONS REGARDING STOCK TRANSFER, WHICH WERE DULY EXPLAINED ON 29.12.2009. AT THAT TIME THE AO AGAIN ASKED THE AR TO BRING THE BOOKS OF ACC OUNT. THE AR ITA NO. 15 07/DEL.2011 7 REQUESTED FOR ADJOURNMENT OF ONE DAY TO PRODUCE THE BOOKS ON THE NEXT DAY BUT THE REQUEST WAS REJECTED ON THE GROUND THAT THE CASE WAS BECOMING TIME BARRED. 4.5 IT WAS SUBMITTED THAT IN VIEW OF THE DETAILED PARTICIPATION OF THE APPELLANT IN THE ASSESSMENT PROCEEDINGS AND DETAILE D VERIFICATION BY THE ASSESSING OFFICER, THE LD AO WAS NOT JUSTIFI ED FEW MAKING HUGE AD-HOC DISALLOWANCE OF 20% OUT OF THE PERSONNE L EXPENSES, MANUFACTURING EXPENSES, SELLING EXPENSES, FINANCIAL EXPENSES AND OTHER ADMINISTRATIVE EXPENSES. THE DISALLOWANCE IS BASED ONLY ON SUSPICIONS AND PRESUMPTIONS RATHER THAN ANY EVIDENC E OR MATERIAL AVAILABLE ON RECORD. ALL THE EXPENSES IN QUESTION A RE LEGITIMATE BUSINESS EXPENDITURE INCURRED WHOLLY AND EXCLUSIVEL Y FOR THE PURPOSE OF THE BUSINESS. NONE OF THE EXPENDITURE IS OF PERSONAL NATURE OR OF CAPITAL NATURE OR OTHERWISE NOT ALLOWA BLE. THE COMPLETE DETAILS AS REQUIRED BY BOTH THE ASSESSING AUTHORITIES I.E. DCIT AND ITO WERE DULY FILED IN THE SHAPE OF COMPLE TE LEDGER ACCOUNTS OF RELEVANT EXPENDITURE. NO DISCREPANCY OF . SHORT COMING WAS FOUND OR POINTED OUT BY THE AO. EVEN IN THE BOO KS OF ACCOUNT AND OTHER DOCUMENTS RETAINED / SEIZED AT MANDI UNIT BY THE DEPARTMENT AND AVAILABLE WITH THE AO, .NO DEFECT OR ' DISCREPANCY WAS FOUND. THEREFORE THERE IS NO BASIS, REASON OR E VIDENCE OR ANY ADVERSE MATERIAL ON RECORD TO MAKE SUCH AD-HOC DISA LLOWANCE. THE EXPENSES INCURRED DURING THE YEAR ARE LOWER AS COMP ARED TO, EXPENSES INCURRED IN THE EARLIER YEARS. THE AO HAS NOT POINTED OUT ANY DEFECT OR DEFICIENCY IN ANY OF THE DETAILS. IT WAS STATED THAT THE AO IS NOT JUSTIFIED TO DISREGARD THE MATERIAL AVAIL ABLE ON RECORD AS WELL AS PAST HISTORY OF THE CASE AND MAKE SUCH AD-H OC AND ARBITRARY DISALLOWANCE U/S 143(3) SPECIALLY WHEN THE AO HAS H IMSELF ADMITTED THAT THE REQUIRED DETAILS FILED AND BOOKS OF ACCOUNT HAVE ALSO NOT BEEN REJECTED. 4.6 I HAVE CONSIDERED THE SUBMISSIONS OF THE LD . COUNSEL AND THE FACTS ON RECORD. IT IS $ OBSERVED THAT THE DISA LLOWANCE HAS BEEN MADE BY THE ASSESSING OFFICER IN AN EXTREMELY ADHOC AND CASUAL MANNER . UNDOUBTEDLY IN THE COURSE OF SCRUTINY THE APPELLANT IS REQUIRED TO ESTABLISH THE CORRECTNESS OF THE RETURN FILED AND IT SHOULD ALSO BE ABLE TO PRODUCE THE BOOKS OF ACCOUNT AND NECESSARY SUPPORTIVE DOCUMENTS. HOWEVER, IT IS ONLY ON 14.12. 2009 THAT THE BOOKS OF ACCOUNT WERE ASKED TO BE PRQDUCED. ON THE NEXT DATE AS ITA NO. 15 07/DEL.2011 8 STATED BY THE APPELLANT THE BOOKS OF ACCOUNT WERE' PRODUCED BUT (COULD NOT BE EXAMINED BY THE ASSESSING OFFICER. ON 29.12.2009 THE ASSESSING OFFICER ASKED THE APPELLANT TO PRODUC E THE BOOKS OF ACCOUNT. THE APPELLANT SOUGHT AN ADJOURNMENT OF A D AY BUT THE SAME WAS NET GRANTED ON ACCOUNT OF ASSESSMENT GETTI NG BARRED BY LIMITATION AND THE ORDER UNDER SECTION 143(3) WAS P ASSED ON 30.12.2009. FROM THE NARRATION OF THE SEQUENCE OF E VENTS AS STATED IN PARA 4.2 TO 4.4 (SUPRA), IT IS EVIDENT THAT THE APPELLANT HAS PRODUCED THE BOOKS OF ACCOUNT WHICH COULD NOT EXAMI NED BY THE ASSESSING OFFICER AND ON THE PENULTIMATE DAY THE BO OKS WERE NOT BROUGHT BY THE APPELLANT - ALTHOUGH ALL OTHER DETAI LS SOUGHT WERE FILED AND EXPLAINED. IN SUCH CIRCUMSTANCES THE APPE LLANT CANNOT BE HELD RESPONSIBLE FOR THE NON-EXAMINATION OF THE BOO KS OF ACCOUNT BY THE ASSESSING OFFICER. IT IS AN ADMITTED FACT TH AT BOOKS OF ACCOUNT HAVE BEEN MAINTAINED AND AUDITED AND ON THE BASIS OF ENTRIES MADE IN THE BOOKS OF ACCOUNT THE NECESSARY DETAILS HAVE BEEN FILED AND EXAMINED BY THE ASSESSING OFFICER. T HE ASSESSMENT PROCEEDINGS HAVE BEEN TAKEN UP WELL IN TIME AND THE CASE HAS BEEN HEARD REGULARLY. THE ASSESSING OFFICER HAS RAISED Q ERIES AND THE EXPLANATIONS HAVE BEEN EXAMINED AND VERIFIED. THE P AST HISTORY OF THE CASE ALSO SHOWS THAT THERE IS NO IRREGULARITY I N THE CLAIM OF EXPENDITURE AND DISALLOWANCES MADE IN ASSESSMENT YE AR 2004-05 AND 2001-02 HAVE BEEN DELETED BY CIT(A) -ITAT. IN F ACT AS PER COMPARATIVE CHART SUBMITTED, THE EXPENDITURE UNDER THESE HEADS HAS DECREASED. IN VIEW OF THE TOTALITY OF FACTS ON RECORD AND FOR THE REASONS AS DISCUSSED ABOVE, IT IS HELD THAT THE ADHOC DISAL LOWANCE OF RS.5135067 IS TOTALLY BASELESS AND WITHOUT ANY JUST IFICATION. THE ADDITION IS ACCORDINGLY DELETED. THE GROUND RAISED BY THE APPELLANT SUCCEEDS. 7. AS DISCUSSED ABOVE THE FIRST APPELLAT E ORDER ON THE ISSUE IS COMPREHENSIVE AND REASONED ONE TO WHICH WE FULLY CO NCUR WITH. THE SAME IS UPHELD. THE GROUND NO. 1 IS ACCORDINGLY REJECTED. GROUND NO.2 ITA NO. 15 07/DEL.2011 9 8. ON THE BASIS OF NOTINGS OF THE SU RVEY TEAM THAT PRODUCTION ACTIVITY OF T.V SETS WAS NOT CONDUCTED AT ITS MANDI AS WELL AS JAMMU UNIT BUT ONLY ASSEMBLING OF T.V SETS OF BESTA VISIONS WAS MADE, THE A.O HELD THE ASSESSEE NOT ELIGIBLE FOR CLAIMING DEDUCTION U/S 80 IB AMOUN TING TO RS.13,28,755/- FOR MANDI UNIT AND U/S 80 IC AMOUNTING TO RS.63,819/- F OR JAMMU UNIT. THE AO ALSO TOOK NOTE OF THE STATEMENTS OF SHRI SANJAY KAU SHIK AS WELL AS THE SURVEY REPORT OF LD. ACIT, CIRCLE, MANDI. 9. THE LD. CIT(A) BEING SATISFIED WITH THE SUBMISSION OF THE ASSESSEE IN THIS REGARD HAS HELD THAT THE ASSESSEE IS VERY MUCH ELIGIBLE FOR THE CLAIMED DEDUCTIONS ON THE INCOME EARNED FROM THE ABOVE UNIT S. 10. IN SUPPORT OF THE GROUND LD. DR HA S BASICALLY PLACED RELIANCE ON THE ASSESSMENT ORDER. HE REITERATED THE OBSERVATION OF THE A.O THAT THE ASSESSEE WAS NOT ENGAGED IN MANUFACTURING OF T.V SETS BUT IT WAS DOING ONLY ASSEMLING WORK OF T.V SETS. THE LD. A.R, HOWEVER, REFERRED T HE FIRST APPELLATE ORDER IN THIS REGARD IN SUPPORT WITH SUBMISSION THAT AN IDEN TICAL ISSUE UNDER SIMILAR SETS OF FACTS WAS RAISED BEFORE THE TRIBUNAL IN THE CASE OF ASSESSEE FOR THE A.Y 2006-07 IN ITA NO 5012/DEL/2010 AND THE TRIBUNAL VI DE ITS ORDER DATED 20/1/2012 HAS DECIDED THE ISSUE IN FAVOUR OF THE AS SESSEE. HE POINTED OUT FURTHER THAT IN THE ASSESSMENT YEARS 2009-10 AND 20 10-2011 THE ASSESSING OFFICER HIMSELF HAS ALLOWED THE CLAIMED DEDUCTION. CONSIDERING THE ABOVE ITA NO. 15 07/DEL.2011 10 SUBMISSIONS WE FIND THAT THE LD. CIT(A) HAS DEALT W ITH THE ISSUE IN DETAIL AND HAS GIVEN HIS FINDING IN PARA NO. 5.3 TO 5.5 OF THE FIRST APPELLATE ORDER, WHICH ARE BEING REPRODUCED HEREUNDER FOR A READY REFERENC E:- 5.3 I HAVE CONSIDERED THE SUBMISSIONS OF THE LD. C OUNSEL AS WELL AS THE FACTS ON RECORD. IN ALL 3 UNITS THE CLAIMS HAVE ALR EADY BEEN SUBJECTED TO FINDINGS BY THE CIT(A) AND ITAT. AS FAR AS THE C LAIM OF THE DEDUCTION UNDER SECTION 80IB FOR JAMMU UNIT IS CONC ERNED, THE CIT(A)-15 VIDE HIS ORDER DATED 23.8.2010 IN APPEAL NO.426/08-09 TAKING COGNIZANCE OF THE FACT THAT THE APPELLANT IS CARRYING OUT MANUFACTURING ACTIVITY AT JAMMU SINCE 6.1.2003 AND THAT THE 80IB CLAIM HAS BEEN ALLOWED IN THE PAST BY THE ASSESSING OFFICER FOR ASSESSMENT YEAR 2003-04 TO 200506 AND THAT IN ASSE SSMENT YEAR 2004-05 THE HON'BLE ITAT VIDE ITS ORDER DATED 7.8.2 009 IN ITA NO.288(DEL) HELD THAT THE ORDER OF THE ASSESSING OF FICER WAS NOT ERRONEOUS OR PREJUDICIAL TO THE INTEREST OF REVENUE AND SET ASIDE THE ORDER OF THE CIT PASSED UNDER SECTION 263, ALLOWED THE CLAIM OF THE 80IB DEDUCTION OF THE JAMMU UNIT FOR ASSESSMENT YEA R 2004-05 . AS THE FACTS FOR ASSESSMENT YEAR 2007-08 ARE IDENTICAL TO ASSESSMENT YEAR 2006-07 WHEREIN ALSO THE ASSESSING OFFICER HAD VIDE ORDER DATED 17.17.2008 HELD THAT NO MANUFACTURING ACTIVIT Y WAS BEING DONE AT JAMMU UNIT AND IN VIEW OF THE ISSUE HAVING BEEN ALREADY DECIDED IN FAVOUR OF THE APPELLANT AND THERE BEING NO DISTINGUISHING FACT, I FIND NO REASON TO DIFFER FROM THE CIT(A)-XV , DELHI'S FINDING THAT THE JAMMU UNIT QUALIFIES FOR THE 80IB DEDUCTIO N. IT IS THUS HELD THAT THE APPELLANT'S GROUND SUCCEEDS WITH REFERENCE TO THE JAMMU UNIT. 5.4 WITH REGARD' TO THE 80IC DEDUCTION FOR THE MAN DI UNIT IT IS OBSERVED THAT ON 4.9.2006 A SURVEY WAS CONDUCTED BY THE TDS UNIT AT MANDI THE SURVEY TEAM OBSERVED THAT HARDLY 10-12 UNSKILLE D LABOURERS WERE WORKING AT MANDI UNIT. NO MANUFACTURING ACTIVI TY WAS BEING CARRIED OUT AT MANDI - ONLY TV PARTS WERE BEING PUT TOGETHER WHICH DID NOT AMOUNT TO MANUFACTURING ACTIVITY. STATEMENT OF THE INCHARGE OF THE MANDI UNIT WAS RECORDED WHICH SHOWS THAT NO MANUFACTURING WAS DONE AT MANDI. IN THE COURSE OF APPELLATE PROCE EDINGS THE APPELLANT HAS BEEN UNABLE TO REBUT THE OBSERVATIONS OF THE ASSESSING OFFICER WITH REGARD TO THE LACK OF MANUFACTURING AC TIVITY AT-MANDI. ITA NO. 15 07/DEL.2011 11 HENCE IT IS HELD THAT THE ASSESSING OFFICER WAS JUS TIFIED IN FORMING THE VIEW THAT THE MANDI UNIT IS NOT ELIGIBLE FOR TH E 80LE DEDUCTION. THE VIEW OF THE ASSESSING OFFICER IS THUS UPHELD. T HE APPELLANT'S GROUND FAILS WITH REFERENCE TO THE MANDI UNIT. 5.5 WITH REGARD TO THE 801B DEDUCTION FOR THE LUD HIANA UNIT, IT IS NOTED THAT THE ASSESSING OFFICER HAS NOT MADE ANY O BSERVATION REGARDING THE ADMISSIBILITY OF THE 80LB DEDUCTION F OR THE LUDHIANA UNIT. PAST HISTORY OF THE CASE INDICATES THAT THE 8 0LB DEDUCTION HAS BEEN ALLOWED TO THE LUDHIANA UNIT SINCE ASSESSMENT YEAR 2001-02. IN THE COURSE OF SURVEY ON 4.9.2006, IT HAS BEEN STATE D THAT THE MANUFACTURING OF CHASSIS AND TV TAKES PLACE ENTIREL Y AT LUDHIANA. THEREFORE IT FOLLOWS THAT AS FAR AS THE MANUFACTURI NG ACTIVITY AT LUDHIANA IS CONCERNED, THE ASSESSING OFFICER HAS NO REASON TO DOUBT THE SAME. HENCE IT IS HELD THAT THAT AS TAR AS ELIG IBILITY FOR THE 80LB DEDUCTION FOR LUDHIANA UNIT IS CONCERNED, THE APPEL LANT DOES NOT FALL SHORT OF THE ELIGIBILITY AND WOULD HAVE BEEN ENTITL ED FOR THE DEDUCTION HAD THERE BEEN POSITIVE INCOME. THE GROUN D RAISED BY THE APPELLANT RELATING TO THE LUDHIANA UNIT IS THUS ALL OWED. 11. WE FIND THAT THE FIRST APPELLATE ORDE R IS COMPREHENSIVE AND REASONED ONE TO WHICH WE FULLY AGREE WITH AND THE ISSUE IS A LSO COVERED BY THE DECISION (SUPRA)OF THE TRIBUNAL IN THE CASE OF ASSESSEE ITSE LF FOR THE A.Y 2006-07. THE FIRST APPELLATE ORDER IN THIS REGARD IS THUS UPHELD . THE GROUND NO-2 IS ACCORDINGLY REJECTED. 12. CONSEQUENTLY APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 30 TH /9/2013. SD/- SD/- (S.V.MEHROTRA) (I.C. SUDHIR) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) DATED THE 30 TH DAY OF SEPTEMBER , 2013 R. NAHEED ITA NO. 15 07/DEL.2011 12 COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. CIT(ITAT), NEW DELHI. AR,ITAT NEW DE LHI.