RENFRO INDIA P.LTD, MUMBAI V. ACIT 10(3), MUMBAI

ITA 1895/MUM/2012

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6995 (ITAT-MUMBAI)
• Duration Of Justice: 7 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2005-2006
• Appeal Filed On: 20-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D G
• Keywords: Business income; Period of limitation; Time period of passing order; Condonation of delay; TDS; Set aside
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY , JUDICIAL MEMBER AND SHRI N.K. PRADHAN , ACCOUNTANT MEMBER ITA NO. 1895 / MUM . /2012 ( ASSESSMENT YEAR : 20 05 06 ) RENFRO INDIA PVT. LTD. 609, MAHALAXMI CHABERS 22, BHULABHAI DESAI RAOD MUMBAI 400 026 PAN AAACK2518C . APPELLANT V/S ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 10 ( 3 ), MUMBAI . RESPONDENT ASSESSEE BY : SHRI MAHAVEER JAIN REVENUE BY : SHRI D.G. PANSARI DATE OF HEARING 11.07 .2019 DATE OF ORDER 31.07.2019 O R D E R PER SAKTIJIT DEY. J.M. A FORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGING THE ORDER DATED 17 TH DECEMBER 2009 , PASSED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) 22 , MUMBAI, PERTAINING TO THE ASSESSMENT YEAR 20 05 06 . 2 RENFRO INDIA PVT. LTD. 2 . BEFORE WE PROCEED TO DEAL WITH THE SUBSTANTIVE ISSUE RAISED IN THE PRESENT APPEAL, IT IS NECESSARY TO OBSERVE THAT THERE IS A DELAY OF 748 DAYS IN FILING THE APPEAL. INITIALLY, THE TRIBUNAL WHILE HEARING THE APPEAL ON 10 TH APRIL 2015 WAS OF THE VIEW THAT THE CAUSE OF DELAY SHOWN BY THE ASSESSEE IS NOT SATISFACTORY, HENCE, VIDE ORDER DATED 5 TH JUNE 2015, DISMISSED ASSESSEES APPEAL IN LIMINE WITHOUT CONDONING THE DELAY. THE ASSESSEE CHALLENGED THE AFORESAID DECISION OF THE TRIBUNAL BEFORE THE HON' BLE JURISDICTIONAL HIGH COURT. THE HONBLE HIGH COURT WHILE DECIDING ASSESSEES APPEAL IN ITA NO.407/2016, VIDE ORDER DATED 19 TH DECEMBER 2018, SET ASIDE THE ORDER PASSED BY THE TRIBUNAL AND RESTORED BACK THE ISSUE OF CONDONATION OF DELAY FOR RECONSIDERATI ON WITH LIBERTY TO THE ASSESSEE TO FILE ADDITIONAL AFFIDAVIT EXPLAINING THE CAUSE OF DELAY. THE OBSERVATIONS OF THE HON'BLE JURISDICTIONAL HIGH COURT ARE AS UNDER: 6 WE HAVE PERUSED THE AFFIDAVIT FILED ON BEHALF OF THE ASSESSEE BEFORE THE TRIBUNAL IN SUPPORT OF THE REQUEST FOR CONDONATION OF DELAY. WE DO NOT FIND THAT THE DELAY, WHICH WAS SUBSTANTIAL IN ANY CASE, WAS PROPERLY EXPLAINED. THE RELEVANT FACTS WERE NOT EL ABORATED IN SUCH AFFIDAVIT. IN FACT OF SUCH AFFIDAVIT, WE DO NOT THINK THAT THE DELAY IN EXCESS OF 700 DAYS, CAUSED IN FILING APPEAL BEFORE THE TRIBUNAL, EVEN BY ADOPTING LIBERAL STANDARDS, CAN BE CONDONED. HOWEVER, WE CANNOT LOOSE SIGHT OF THE CONTENTIONS OF THE COUNSEL FOR THE ASSESSEE THAT, ON THE SAME ISSUE, FOR THE SUCCEEDING AS WELL AS FOR THE PRECEDING ASSESSMENT YEAR, THE ASSESSEE HAD FILED APPEAL BEFORE THE TRIBUNAL AND THAT ISSUE BEING COVERED BY THE JUDGMENT OF THE HIGH COURT, SUCH APPEALS WERE A LLOWED. THEREFORE, WE WOULD NOT READILY ACCEPT THE FACT THAT THE ASSESSEE WAS NOT INTERESTED IN FILING APPEAL IN THE PRESENT YEAR ALSO. HOWEVER, ASSESSEE MUST EXPLAIN THE DELAY PROPERLY WHICH, IN THE PRESENT 3 RENFRO INDIA PVT. LTD. CASE, HAS NOT BEEN DONE. WE WOULD, THEREFORE, EN ABLE THE ASSESSEE TO FILE ADDITIONAL AFFIDAVIT BEFORE THE TRIBUNAL, GIVING FURTHER AND BETTER PARTICULARS OF THE REASONS FOR THE DELAY. FOR SUCH PURPOSE, WE WOULD REMAND THE PROCEEDINGS BEFORE THE TRIBUNAL AFTER SETTING ASIDE THE IMPUGNED JUDGMENT. THE ASS ESSEE WOULD BE AT LIBERTY TO FILE ADDITIONAL AFFIDAVIT IN SUPPORT OF THE REQUEST FOR CONDONATION OF DELAY. SUCH AFFIDAVIT MAY BE FILED BEFORE 31ST JANUARY, 2019 BEFORE THE TRIBUNAL. 7. BEFORE CLOSING, WE MAY CLARIFY THAT MERELY BECAUSE IN THE PRESENT CASE, THE APPEAL WAS FILED NOT SIMULTANEOUSLY ALONG WITH APPEAL FOR THE ASSESSMENT YEAR 2007 - 08, WOULD NOT BY ITSELF FALSIFY ASSESSEE'S EXPLANATION, PARTICULARLY, THE STATEMENT THAT ASSEESSEE'S APPEAL WAS READY FOR PRESENTATION BEFORE THE TRIBUNAL. THE TRI BUNAL EXAMINED ALL ASPECTS OF THE ASSESSEE. 3 . IN PURSUANCE TO THE AFORESAID DIRECTIONS OF THE HON'BLE JURISDICTIONAL HIGH COURT, THE ASSESSEE HAS FILED A FRESH APPLICATION SEEKING CONDONATION OF DELAY ALONG WITH ADDITIONAL AFFIDAVIT SWORN BY SHRI CHUGH JO GINDER PAL, ONE OF THE DIRECTORS OF THE ASSESSEE COMPANY. THE CON TENT OF THE SAID ADDITIONAL AFFIDAVIT IS AS UNDER: AFFIDAVIT I, CHUGH YOGINDER PAL, S/O SHRI RAMCHAND PAL, RESIDING AT 11B, VAIBHAV APARTMENTS, 80 BHULABHAI DESAI ROAD, MUMBAI - 400026 DO HEREBY SOLEMNLY AFFIRM ON OATH AND DECLARE AS FOLLOWS: - 1 . THAT I AM THE DIRECTOR AND CHAIRMAN OF APPELLANT - COMPANY HAVING ITS OFFICE AT 609, MAHALAXMI CHAMBERS, 22, BHULABHAI DESAI ROAD, MUMBAI - 4000026. 2 . THAT FOR ASSESSMENT YEAR 2005 - 06, THE APPELLANT - COM PANY HAD PREFERRED AN APPEAL BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS) AGAINST THE ORDER PASSED BY THE ASSESSING OFFICER MUMBAI. 3 . THAT, THE ORDER IN RESPECT OF THE ABOVE SAID APPEAL BEFORE THE CIT(A) WAS PASSED ON 17.12.2009 AND WAS RECEI V ED BY TH E 4 RENFRO INDIA PVT. LTD. APPELLANT - COMPANY ON 02.01.2010. 4 . THAT THE APPELLANT COMPANY HAD DECIDED TO FILE APPEAL BEFORE THE HON'BLE INCOME TAX APPELLANT TRIBUNAL (ITAT) AGAINST THE ABOVE ORDER OF CIT(A). THEREFORE, IMMEDIATELY, AFTER RECEIVING THE ORDER, A COPY OF THE SAME WAS FORWARDED TO OUR TAX CONSULTANT FOR FURTHER ACTION. 5 . THAT THE SAID APPEAL BEFORE THE HON'BLE ITAT FOR AY 2005 - 06 HAD TO BE FILED WITHIN 60 DAYS FROM THE DATE OF RECEIPT OF THE ORDER OF THE CIT(A), I.E., ON OR BEFORE 03.03.2010. HOWEVER, THE SAME HAD BEEN FILED BY APPELLANT - COMPANY ON 20.03.2012. 6. THUS THERE WAS A DELAY OF 742 DAYS IN FILING OF APPEAL BEFORE THE HONORABLE INCOME TAX APPELLATE TRIBUNAL. 7. THAT, THE SAID DELAY OF 742 DAYS OCCURRED DUE TO THE FACT THAT THE OFFICE ADMINISTRATOR OF THE APPELLATE - COMPANY, SHRI NANDU LOHIKPURE WHO RECEIVED I THE DRAFT APPEAL MEMO IN 1 ST 1ST WEEK OF FEBRUARY, 2010 FROM OUR TAX CONSULTANT FOR FURTHER ACTION, HAD FA ILED TO BRING THE SAME TO THE NOTICE OF THE MANAGEMENT AND THAT THE SAME CAME TO THE KNOWLEDGE OF THE APPELLANT COMPANY DURING THE COURSE OF THE FILING OF THE APPEAL BEFORE THE ITAT FOR THE AY 2007 - 08. 8. THAT, IN THE MONTH OF FEBRUARY, 2012 WHILE PREPARING THE APPEAL FOR ASSESSMENT YEAR 2007 - 08, WHEN THE TAX CONSULTANT ASKED FOR THE COPY OF THE APPEAL MEMO FILED FOR AY 05 - 06 FOR THE PURPOSE OF REFERENCE SINCE THE ISSUES WERE COMMON, THE APPELLANT COMPANY WAS UNABLE TO FIND THE FILED APPEAL MEMO IN FORM - 36 FOR ASSESSMENT YEAR 2005 - 06 FOR THE REQUIRED PURPOSE. 9. THAT, THEREAFTER APPELLANT - COMPANY RECHECKED WITH ITS TAX CONSULTANT ABOUT THE APPEAL MEMO OF THE ASSESSMENT YEAR 2005 - 06, THEN WE WERE INFORMED THAT THE APPEAL MEMO HAD ALREADY BEEN SENT T O THE APPELLANT - COMPANY'S ADMINISTRATIVE OFFICE AT PUNE AND THE SAME WAS RECEIVED BY THE OFFICE ADMINISTRATOR MR. NANDU LOHIKPURE FOR FURTHER ACTION IN 1ST WEEK OF FEBRUARY, 2010. 10. THAT, UPON FURTHER INQUIRY IN THE SELF OFFICE BY THE APPELLANT COMPAN Y, IT CAME TO THE APPELLANT'S KNOWLEDGE THAT SHRI. NANDU LOHIKPURE WHO IS WORKING AS AN OFFICE ADMINISTRATOR HAD RECEIVED THE DRAFT APPEAL FOR ASSESSMENT YEAR 2005 - 06 IN OR ABOUT 1 ST WEEK OF FEBRUARY, 2010 FROM THE TAX CONSULTANT FOR FURTHER ACTION. 5 RENFRO INDIA PVT. LTD. 11. T HAT, WHEN THE APPEAL MEMO WAS RECEIVED, THE APPELLANT COMPANY'S DIRECTOR, MR. ROHIT PAL, WHO WAS LOOKING AFTER THESE AFFAIRS WAS TRAVELLING OUT OF COUNTRY. MR ROHIT PAL, MANAGING DIRECTOR WAS IN LONDON FROM 2ND FEBRUARY, 2010 TO 12TH FEBRUARY 2010. THIS WAS FOLLOWED BY THREE MORE TRIPS ABROAD TO DUBAI UNTIL 23RD APRIL, 2010. IN THE MEANTIME, THE OFFICE ADMINISTRATOR KEPT THE APPEAL MEMO IN HIS OFFICE DRAWER SO THAT HE CAN GET THE SAME APPROVED AND SIGNED FROM THE DIRECTOR AS SOON AS HE RETURNS BACK TO THE OFFICE. HOWEVER, THE OFFICE ADMINISTRATOR UNFORTUNATELY FORGOT TO INFORM THE SAME TO ANYBODY OR CONCERNED DIRECTOR MR. ROHIT PAL FOR HIS SIGNATURE AND APPROVAL ON HIS INTERMITTENT RETURN TO THE OFFICE. AS A RESULT, THE APPEAL FOR THE ASSESSMENT YEAR 2005 06 REMAINED UNFILED IN HIS OFFICE DRAWER. 12 . THAT SINCE THERE WAS NO DEMAND PENDING FOR AY 2005 - 06, THE ISSUE OF NON - FILING OF APPEAL DID NOT COME TO NOTICE OF THE COMPANY SOONER OR BECAME APPARENT. 13 . THAT, UPON REALIZING AT THE TIME OF FILING OF APPEAL FOR AY 2007 - 08, THAT THE APPEAL FOR AY 2005 - 06 HAS NOT BEEN FILED YET, MATTER WAS IMMEDIATELY BROUGHT TO THE NOTICE OF BOARD OF DIRECTORS. AS THE DUE DATE FOR FILING OF APPEAL FOR AY 2007 - 08 WAS APPROACHING, APPELLANT FIRST FILED APPEAL FOR AY 2007 - 08 ON 21.02 .2012. SIMULTANEOUSLY, APPELLANT APPROACHED ITS TAX CONSULTANT FOR FILING OF APPEAL FOR AY 2005 - 06 WITH CONDONATION OF DELAY. 14 . THAT APPEAL FOR ASSESSMENT YEAR 2005 - 06 GOT FILED WITHIN ONE MONTH FROM THE DATE OF FILING OF APPEAL FOR ASSESSMENT YEAR 2007 - 08 I.E. ON 20.03.2012. THE APPELLANT COMPANY TOOK ONE - MONTH TIME AFTER FILING APPEAL FOR ASSESSMENT YEAR 2007 - 08 BECAUSE CONSULTATION REGARDING THE FURTHER COURSE OF ACTION TO BE ADOPTED AS THE APPEAL WAS DELAYED TOOK SOME TIME. FURTHER, TIME WAS ALSO REQUIRE D FOR PREPARATION OF AFFIDAVITS FOR CONDONATION OF DELAY, WHICH WERE ALSO FILED ALONG WITH THE APPEAL. 15 . THAT, APPELLANT - COMPANY HAVE BEEN DILIGENT ENOUGH TO FILE APPEALS IN TIME FOR EARLIER AND SUBSEQUENT YEARS. 16 . THAT, THE APPELLATE ORDER DATED 17.10.2008 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2004 - 05 WAS RECEIVED BY US ON 07.11.2008. HENCE THE LAST DATE FOR FILLING THE APPEAL BEFORE THE HON'BLE APPELLATE TRIBUNAL WAS 06.01.2009 AND THE APPEAL WAS FILED ON 12.12.2008. THUS, THE APPEAL FOR ASSESSME NT YEAR 2004 05 IS FILED WITHIN THE LIMITATION PERIOD OF 60 DAYS AS 6 RENFRO INDIA PVT. LTD. PRESCRIBED UNDER THE PROVISION OF LAW. 17 . THAT, THE APPELLATE ORDER DATED 19.12.2011 PASSED BY THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2007 - 08 WAS RECEIVED BY US ON 29.12.2011. HENCE, THE LAS T DATE FOR FILLING THE APPEAL BEFORE THE APPELLATE TRIBUNAL WAS 27.02.2012 AND THE APPEAL WAS FILED ON 21.02.2012. THUS, THE APPEAL FOR ASSESSMENT YEAR 2007 - 08 IS FILED WITHIN THE LIMITATION PERIOD OF 60 DAYS AS PRESCRIBED UNDER THE PROVISION OF LAW. 18 . THAT , IN THE PRECEDING AND SUBSEQUENT ASSESSMENT YEARS I.E., A.Y. 2004 - 05 AND A.Y. 2007 - 08 RESPECTIVELY, THE ISSUE INVOLVED WAS IDENTICAL TO THE PRESENT ASSESSMENT YEAR AND THE APPEALS WERE FILED WITHIN THE PRESCRIBED TIME LIMIT. HENCE, THERE WAS NO REASON FOR NOT PURSUING THE APPEAL IN THE PRESENT ASSESSMENT YEAR. 19 . THAT I WOULD HUMBLY SUBMIT THAT NO MALA FIDE INTENTION OR DELIBERATE ATTEMPT IS INVOLVED IN DELAYING THE FILING OF APPEAL. 4 . ON A PERUSAL OF THE CONTENTS OF THE ADDITIONAL AFFIDAVIT FILED BY THE ASSESSEE, IT IS NOTICED THAT THE DELAY IN FILING OF THE APPEAL IS DUE TO THE FACT THAT THE OFFICE ADMINISTRATOR OF THE COMPANY SHRI NANDU LOHIP URE, WHO RECEIVED THE DR AFT APPEAL MEMORANDUM FROM THE TAX C ONSULTANT FAILED TO BRING THE SAME TO THE NOTICE OF T HE MANAGEMENT FOR FURTHER ACTION AND THEREAFTER COMPLETELY FORGOT ABOUT IT . IN FACT, AN AFFIDAVIT IN THIS REGARD SWORN BY THE CONCERNED EMPLOYEE , SHRI NANDU LOHIP URE, HAS ALSO BEEN FILED BEFORE THE TRIBUNAL. IT IS SUBMITTED , WHILE PREPARING THE APPEAL FOR THE ASSESSMENT YEAR 2007 08, WHEN THE CONCERNED CHARTERED ACCOUNTANT ENQUIRED ABOUT THE APPEAL FOR THE IMPUGNED ASSESSMENT YEAR, THEN ONLY IT COULD BE FOUND OUT THAT THE APPEAL FOR THE IMPUGNED ASSESSMENT YEAR HAS NOT BEEN FILED. THUS, 7 RENFRO INDIA PVT. LTD. IMMEDIATE STEPS WERE TAKEN FOR FILING OF THE APPEALS WITH DELAY. IN ADDITION TO THE AVERMENTS MADE IN THE AFFIDAVIT S , THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THERE WAS NO REASON FOR NOT FILING THE PRESENT APPEAL AS THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2004 05. HE SUBMITTED , SINCE THE ASSESSEE HAD A STRONG CASE ON MERIT, THE DELAY IN FILING THE APPEAL SHOULD BE CONDONED IN THE INTEREST OF JUSTICE AND THE APPEAL SHOULD BE DECIDED ON MERIT. IN SUPPORT OF SUCH CONTENTION, HE RELIED UPON THE FOLLOWING DECISIONS: I ) HATHWAY C NET PVT. LTD. V/S TRO (TDS), [2018] (2) TMI 179 ITAT MUMBAI; AND II ) PRIMA PAPER & ENGINEERING PVT. LTD. V/S CIT, [2013] (7) TMI 939 BOMBAY HC. 5 . THE LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY OPPOSING CONDONATION OF DELAY SUBMITTED , IN THE ADDITIONAL AFFIDAVIT ALSO, THE ASSESSEE HAS NOT MADE OUT A REASONABLE CA USE FOR CONDONING THE DELAY. THUS, HE SUBMITTED , ASSESSEES APPEAL SHOULD BE DISMISSED IN LIMINE WITHOUT CONDONING THE DELAY. 6 . WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. AS DISCUSSED EARLIER, THE HON'BLE JURISDICTIONAL HIGH COURT HAS GRANTED LIBERTY TO THE ASSESSEE TO FILE ADDITIONAL AFFIDAVIT FOR THE PURPOSE OF SHOWING BETTER CAUSE FOR EXPLAINING THE DELAY. WHIL E DOING 8 RENFRO INDIA PVT. LTD. SO, THE HONBLE HIGH COURT ALSO TOOK NOTE OF THE SUBMISSIONS OF THE ASSESSEE THAT IDENTICAL ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE IN ITS OWN CASE IN EARLIER ASSESSMENT YEAR. FURTHER, THE HON'BLE JURISDICTIONAL HIGH COURT HAS OBSERVED THA T MERELY BECAUSE THE PRESENT APPEAL WAS NOT FILED SIMULTANEOUSLY WITH THE APPEAL FOR THE ASSESSMENT YEAR 2007 08 WOULD NOT FALSIFY ASSESSEES CLAIM IN THE ADDITIONAL AFFIDAVIT. UNDISPUTEDLY, THE ISSUE IN DISPUTE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE I N ITS OWN CASE IN ASSESSMENT YEAR 2004 05. THEREFORE, THERE CANNOT BE ANY MANNER OF DOUBT THAT THE ASSESSEE HAS A VERY STRONG CASE ON MERIT. THUS, KEEPING IN VIEW THE AVERMENT S MADE IN THE ADDITIONAL AFFIDAVIT S FILED BEFORE US AND ALL OTHER SURROUNDING CIR CUMSTANCES , INCLUDING THE OBSERVATIONS OF THE HIGH COURT WHILE REMANDING THE MATTER BACK TO THE TRIBUNAL, WE ARE OF THE CONSIDERED OPINION THAT THE DELAY IN FILING THE PRESENT APPEAL IS DUE TO REASONABLE CASE. ACCORDINGLY, WE ARE INCLINED TO CONDONE THE DE LAY AND ADMIT THE APPEAL FOR ADJUDICATION ON MERIT. 7 . THE DISPUTE IN THE PRESENT APPEAL IS IN RELATION TO DISALLOWANCE OF DEDUCTION CLAIMED UNDER SECTION 10B OF THE ACT. 8 . BRIEF FACTS ARE, THE ASSESSEE IS IN THE BUSINESS OF MANUFACTURE AND EXPORT OF KNITTED SOCKS. FOR ITS MANUFACTURING ACTIVITY, THE ASSESSEE HAS SET UP TWO UNITS , ONE AT PUNE AND ANOTHER AT NASHIK. IN 9 RENFRO INDIA PVT. LTD. THE RETURN OF INCOME FILED FOR THE IMPUGNED ASSESSMENT YEAR, THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 10B OF THE ACT UNIT WISE. IN OTHER WOR DS, AGAINST THE PROFIT OF PUNE UNIT THE ASSESSEE CLAIMED DEDUCTI ON UNDER SECTION 10B OF THE ACT. WHEREAS, SINCE THERE WAS A LOSS OF ` 3,43,27,675 IN THE NASHIK UNIT, THERE WAS NO SCOPE FOR CLAIMING ANY DEDUCTION UNDER SECTION 10B OF THE AC T. FURTHER, THE N ET PROFIT OF PU NE UNIT AFTER CLAIMING DEDUCTION UNDER SECTION 10B OF THE ACT AMOUNTING TO ` 2,38,664, WAS SET OFF AGAINST THE LOSS OF NASHIK UNIT. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER WHILE EXAMINING ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 10B OF THE ACT HELD THAT SUCH DEDUCTION HAS TO BE ALLOW ED AFTER AGGREGATING THE PROFIT/ LOSS OF BOTH THE UNITS TOGETHER. ACCORDINGLY, HE PROCEEDED TO COMPUTE THE DEDUCTION UNDER SECTION 10B OF THE ACT BY COMBINING T HE PROFIT/ LOSS OF BOTH THE U NITS WHICH RESULTED IN NET LOSS OF ` 2,01,71,429. THOUGH , THE ASSESSEE CHALLENGED THE AFORESAID DECISION OF THE ASSESSING OFFICER BEFORE LEARNED COMMISSIONER (APPEALS), HOWEVER, LEARNED COMMISSIONER (APPEALS) UPHELD THE DECISION OF THE ASSESSING OFFICER. 9 . THE LEARNED AUTHORISED REPRESENTATIVE SUBMITTED , THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE IN ITS OWN CASE FOR THE ASSESSMENT YEAR 2004 05 . WHEREAS, THE LEARNED DEPARTMENTAL 10 RENFRO INDIA PVT. LTD. REPRESENTATIVE RELIED UPON THE OBSERVATIONS OF LEARNED COMMISSIONER (APPEALS) AND THE ASSESSING OFFICER. 10 . WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED MATERIAL ON RECORD. THE SHORT ISSUE BEFORE US IS , WHETHER THE DEDUCTION UNDER SECTION 10B OF THE ACT HAS TO BE ALLOWED UNIT WISE OR AFTE R AGGREGATING THE PROFIT/LOSS OF BOTH THE UNITS? IN OUR VIEW, THE DISPUTED ISSUE DOES NOT REQUIRE MUCH DELIBERATION AS IDENTICAL ISSUE AROSE IN ASSESSEES OWN CASE IN ASSESSMENT YEAR 2004 05. WHILE DECIDING THE ISSUE IN ITA NO.7076/ MUM./2008, DATED 10 TH JUNE 2015, THE TRIBUNAL, FOLLOWING THE DECISION IN ASSESSEES OWN CASE AS WELL AS THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT , HAS HELD AS UNDER: 3. WE HAVE CONSIDERED AN IDENTICAL ISSUE IN THE APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 2007 08 IN ITA NO.1170/MUM./12. TH E RELEVANT DISCUSSIONS MADE AND THE DECISION TAKEN IS EXTRACTED BELOW: 17. THE ASSESSEE HAS ALSO RAISED AN ADDITIONAL GROUND OF APPEAL, WHEREIN IT IS CONTESTED THAT THE LOSS INCURRED IN NASHIK UNIT SHOULD NOT BE SET OFF AGAINST THE PUNE UNIT FOR COMPUTI NG DEDUCTION UNDER SECTION 10B OF THE ACT IN RESPECT OF PUNE UNIT. THE ASSESSEE RELIED UPON THE DECISION OF HON'BLE BOMBAY HIGH COURT RENDERED IN THE CASE OF HINDUSTAN UNILEVER LTD. (325 ITR 102) AND CIT V/S BLACK & VEATCH CONSULTING PVT. LTD. (348 ITR 72) . WE NOTICE THAT THE CO ORDINATE BENCH OF ITAT IN THE CASE OF LARSEN & TOUBRO INFOTECH LTD. (SUPRA) HAS TAKEN THE VIEW THAT THE DEDUCTION U/S 10B IS ALLOWABLE EACH UNDERTAKING WISE AND HENCE THE LOSS INCURRED IN ONE ELIGIBLE UNIT SHOULD NOT BE SET OFF AGAI NST THE INCOME FROM OTHER ELIGIBLE UNIT. FURTHER, FOLLOWING OBSERVATIONS MADE BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF 11 RENFRO INDIA PVT. LTD. HINDUSTAN UNILEVER LTD. SUPPORT THE CASE OF THE ASSESSEE: ALL THE FOUR UNITS OF THE ASSESSEE WERE ELIGIBLE UNDER SECTION 10B. T HREE UNITS HAD RETURNED A PROFIT DURING THE COURSE OF ASSESSMENT YEAR, WHILE THE CRAB STICK UNIT HAD RETURNED A LOSS. THE ASSESSEE WAS ENTITLED TO A DEDUCTION IN RESPECT OF THE PROFITS OF THE THREE UNITS WHILE THE LOSS SUSTAINED BY THE FOURTH UNIT COULD BE SET OFF AGAINST NORMAL BUSINESS INCOME. ACCORDINGLY, WE ALLOW THE ADDITIONAL GROUND RAISED BY THE ASSESSEE AND DIRECT THE ASSESSING OFFICER TO COMPUTE THE DEDUCTION U/S 10B ACCORDINGLY. . CONSISTENT WITH THE VIEW TAKEN BY US IN A.Y. 2007 08, WE SET ASIDE THE ORDER OF THE LD CIT(A) AND DIRECT THE A.O. TO ALLOW DEDUCTION U/S 10B FOR PUNE UNIT WITHOUT ADJUSTING THE LOSS DECLARED IN NASHIK UNIT. 11 . FACTS BEING IDENTICAL AND NO CONTRARY DECISION ON THE ISSUE HAVING BEEN BROUGHT TO OUR NOTICE BY THE LEARNED DEPARTMENTAL REPRESENTA TIVE, RESPECTFULLY FOLLOWING THE AFORESAID DECISION OF THE CO ORDINATE BENCH IN ASSESSEES OWN CASE, WE DIRECT THE A .O. TO ALLOW ASSESSEES CLAIM OF DEDUCTION U / S 10B OF THE ACT FOR THE PUNE UNIT WITHOUT ADJUSTING THE LOSS OF NASHIK UNIT. ACCORDINGLY, GROUNDS ARE ALLOWED. 12 . I N THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN C OURT ON 31.07.2019 SD/ - N.K. PRADHAN ACCOUNTANT MEMBER SD/ - SAKTIJIT DEY JUDICIAL MEMBER MUMBAI, DATED: 31.07.2019 12 RENFRO INDIA PVT. LTD. COPY OF THE ORDER FORWARDED TO : ( 1 ) THE ASSESSEE; ( 2 ) THE REVENUE; ( 3 ) THE CIT(A); ( 4 ) THE CIT, MUMBAI CITY CONCERNED; ( 5 ) THE DR, ITAT, MUMBAI; ( 6 ) GUARD FILE . TRUE COPY BY ORDER PRADEEP J. CHOWDHURY SR. PRIVATE SECRETARY ASSISTANT REGISTRAR ITAT, MUMBAI