M/s. N Core Cables, Daman V. The Income tax Officer, Ward-4, Daman

ITA 3207/AHD/2007

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 9436 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 01-09-2010
• Assessment Year: 2004-2005
• Appeal Filed On: 30-07-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K M MAHESHDR
• Assessee Lawyers: M K PATEL
• Keywords: Depreciation; Set aside
• Section: 80IB; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'C' BEFORE SHRI BHAVNESH SAINI,JM & SHRI A N PAHUJA,AM ITA NO.3207/AHD/2007 (ASSESSMENT YEAR:-2004-05) M/S N CORE CABLES, GALA NO.7, PLOT NO.10, PREMIER INDUSTRIAL AREA, KACHIGAM, DAMAN [PAN: AAEFN 7954 N] V/S INCOME-TAX OFFICER, VAPI WARD-4, DAMAN [APPELLANT] [RESPONDENT] ASSESSEE BY :- SHRI M K PATEL, AR REVENUE BY:- SHRI K M MAHESH,DR O R D E R A N PAHUJA: THIS APPEAL BY THE ASSESSEE AGAINST AN ORDER DATE D 30-03-2007 OF THE LD. CIT(APPEALS), VALSAD ,RAISES THE FOLLOWING GROUNDS :- 1 THE LEARNED COMMISSIONER OF INCOME-TAX ERRED ON FAC TS AND IN LAW, IN CONFIRMING THE CONCLUSION OF THE ASSESSING OFFICER THAT YOUR APPELLANT IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80IB OF TH E ACT. 2 THE LEARNED COMMISSIONER OF INCOME-TAX ERRED ON F ACTS AND IN LAW, IN CONFIRMING THE REJECTION OF THE CLAIM OF YOUR APPEL LANT THAT YOUR APPELLANT IS MANUFACTURER AS THE MANUFACTURING HAS BEEN CARRIED OUT UNDER ITS DIRECT SUPERVISION AND CONTROL AND WITH T HE HELP OF ITS TECHNICAL KNOW HOW BY USING THE MANUFACTURING ACTIVITY OF ONE OF ITS SISTER CONCERN. 3. YOUR APPELLANT CRAVES THE LEAVE TO ADD, ALTER ,AMEND, MODIFY, DELETE AND APPEND ANY OF THE GROUNDS OF APPEAL . 2. AT THE TIME OF HEARING OF THIS APPEAL ON 01-0 9-2010, THE ASSESSEE FILED AN APPLICATION FOR MODIFICATION OF T HE EXISTING GROUNDS AND ADMISSION OF ADDITIONAL GROUNDS. THE GROUNDS NO W RAISED ARE AS UNDER: 1 ON APPRECIATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED IN CONFIRMING THE ACTION OF THE LEARNED AO IN NOT G RANTING DEDUCTION U/S 80IB OF THE INCOME-TAX ACT 1961 TO THE APPELLAN T ON THE BASIS OF THE FACTS OF THE CASE AS IS EVIDENT FROM RECORD. TH E ACTION OF THE ITA NO.3207/AHD/2007 2 LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IS CON TRARY TO THE FACTS AND LAW AND DESERVES TO BE DELETED. 2 ON APPRECIATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED COMMISSIONER OF INCOME TAX (APPEAL S) HAS ERRED IN IGNORING THE PRODUCTION OF PVC / TPR INSULATED W IRES AND CABLES WITH AND WITHOUT CONNECTORS / COUPLERS, PVC SLEEVES ETC. HAVING A VALUE OF RS.19,12,835 DURING THE YEAR AT ITS INDUST RIAL UNDERTAKING AT DAMAN USING THE APPELLANTS OWN MACHINERIES AND POW ER GENERATED FROM DIESEL GENERATOR SET WHILE UPHOLDING THE ACTIO N OF THE LEARNED AO DENYING OF DEDUCTION U/S 80IB. 3 ALTERNATIVELY AND WITHOUT PREJUDICE TO EACH OTHER THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN N OT ACCEPTING THE APPELLANTS CONTENTION THAT THE MANUFACTURING O F RUBBER CABLES CARRIED OUT UNDER THE DIRECT SUPERVISION AND CONTRO L OF ONE OF PARTNERS OF THE APPELLANT BY USING MANUFACTURING FA CILITY OF M/S NANGALWALA CHEMICAL INDUSTRIES AMOUNTS TO MANUFACTU RING AND / OR PRODUCTION OF AN ARTICLE OR THING WITHIN THE MEANIN G OF SECTION 80IB OF THE INCOME TAX ACT, 1961. THE APPELLANT CRAVES TO ADD, ALTER ,AMEND, MODIFY, DELETE AND APPEND ANY OF THE GROUNDS OF APPEAL 3. THE LD. DR APPEARING BEFORE US DID NOT RAISE A NY OBJECTION TO THE ADMISSION OF AFORESAID MODIFIED/ADDITIONAL GROU NDS. SINCE THESE GROUNDS ARE GERMANE TO THE MAIN ISSUE OF DEDUCTION U/S 80IB OF THE ACT, THEREFORE, APPEAL IS BEING DECIDED ON THE BAS IS OF THESE GROUNDS. ADVERTING NOW TO THESE MODIFIED GROUNDS, FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THAT RETURN DECLARING N IL INCOME FILED ON 07-10-2004 BY THE ASSESSEE, ENGAGED IN THE BUSINESS OF INSULATED CABLE WITHOUT PVC TAPE & SLEEVE AND PLASTIC GRANULE S, AFTER BEING PROCESSED ON 7.10.2004 U/S 143(1) OF THE INCOME-TAX ACT,1961[HEREINAFTER REFERRED TO AS THE ACT], WAS TAKEN UP FOR SCRUTINY WITH THE SERVICE OF NOTICE U/S 143(2) OF T HE ACT ON 13.1.2005. DURING THE COURSE OF ASSESSMENT PROCEED INGS, THE ASSESSING OFFICER[AO IN SHORT] NOTICED THAT THE AS SESSEE CLAIMED DEDUCTION U/S 80IB OF THE ACT FOR AN AMOUNT OF RS. 8,00,308/-. THE UNIT OF THE ASSESSEE LOCATED IN THE UNION TERRITOR Y OF DAMAN, A BACK- WARD AREA SPECIFIED IN THE VIIITH SCHEDULE TO THE A CT, IS STATED TO HAVE STARTED ITS BUSINESS ACTIVITY IN THE PERIOD R ELEVANT TO THE YEAR ITA NO.3207/AHD/2007 3 UNDER CONSIDERATION. SINCE THE ASSESSEE WAS NOT UTI LIZING ANY POWER IN ITS UNIT IN THE YEAR UNDER CONSIDERATION, THE A O SHOWCAUSED THE ASSESSEE VIDE LETTER DATED 3-11-2006 AS TO WHY THE CLAIM FOR DEDUCTION U/S.80-IB OF THE ACT MAY NOT BE DISALLOWE D IN TERMS OF PROVISIONS OF SEC.80-IB(2)(IV) OF THE ACT. IN RESP ONSE, THE LD. AR ON BEHALF OF THE ASSESSEE FILED WRITTEN SUBMISSIONS, MENTIONING THAT SINCE ELECTRICITY CONNECTION HAD NOT BEEN RELEASED BY THE ELECTRICITY DEPARTMENT, THE ASSESSEE USED GENERATO R HIRED FROM M/S NANGALWALA IMPEX (PVT.) LTD. DURING THE PERIOD 15-0 2-2004 TO 31-03- 2004. IN THIS REGARD, ASSESSEE SUBMITTED A CONFIRMA TION LETTER OF M/S NANGALWALA IMPEX PVT. LTD.,A SISTER CONCERN OF THE ASSESSEE. 3.1 THE AO ALSO NOTICED THAT THE UNDERTAKING HAD GOT DONE LOB WORK FROM M/S. NANGALWALA CHEMICAL INDUSTRIES AT AL WAR FOR COPPER DRAWING AND MAKING OF RUBBER CABLES. TO A QUERY BY THE AO, THE ASSESSEE SUBMITTED IN PARA 3 OF THEIR LETTER DATED 26-12-2006 THAT- INITIALLY OUR CLIENT DO NOT HAVE THE FACILITY FOR MANUFACTURING OF RUBBER CABLE BUT, IT HAS BEST TECHNICAL KNOW HOW FO R MANUFACTURING OF RUBBER CABLE. IT HAS TAKEN THE ORDER AND EXECUTED T HE SAME BY WAY OF MANUFACTURING DONE BY M/S. NANGALWALA CHEMICAL INDU STRIES OF ALWAR, UNDER THE DIRECT SUPERVISION OF ONE OF THE PARTNER MR. NARESH AGARWAL. MR. NARESH AGARWAL IS IN THIS LINE SINCE LAST 10 YEARS. HE IS THE MAIN TECHNICAL PERSON OF OUR CLIENT'S UNIT. AS THE MANUFACTURING P ROCESS HAS BEEN CARRIED OUT BY M/S. NANGALWALA CHEMICAL INDUSTRIES, UNDER T HE DIRECT SUPERVISION AND CONTROL AND WITH THE AID OF TECHNICAL KNOW HOW OF OUR CLIENT, OUR CLIENT IS THE MANUFACTURER.' 3.2 AFTER CONSIDERING THE REPLY OF THE ASSESSEE, THE AO CONCLUDED THAT THE UNDERTAKING OF THE ASSESSEE WAS NOT D OING ANY MANUFACTURING ACTIVITY AND WAS GETTING JOB WORK DONE FROM M/S. NA NGALWALA CHEMICAL INDUSTRIES, A SISTER CONCERN, THE ASSESSEE HAVING ADMITTEDL Y TAKEN THE ORDER AND EXECUTED THE SAME BY WAY OF MANUFACTURING DONE BY M/S. NANGA LWALA CHGMICAL INDUSTRIES UNDER THE SUPERVISION OF ONE OF THE PARTNER MR. NA RESH AGARWAL, WHO WAS A COMMON PARTNER IN BOTH THE FIRMS NAMELY M/S. NANGAL WALA CHEMICAL INDUSTRIES AS WELL AS THE ASSESSEE. ACCORDINGLY, THE AO DENIE D THE CLAIM FOR DEDUCTION U/S 80IB OF THE ACT. ITA NO.3207/AHD/2007 4 4. ON APPEAL, THE LD. CIT(A) UPHELD THE ACTION OF THE AO IN THE FOLLOWING TERMS:- 09. I HAVE PERUSED THE FINDINGS OF THE ASSESSING O FFICER AND THE SUBMISSION MADE BY THE LEARNED A.R. APPEARING ON BE HALF OF THE APPELLANT AND THE JUDICIAL DECISIONS AS RELIED UPON BY HIM. S ECTION 80IB APPLIES TO ANY INDUSTRIAL UNDERTAKING WHICH FULFILLS ALL THE F OLLOWING CONDITIONS NAMELY; '(I) IT IS NOT FORMED BY SPLITTING UP, OR THE RECON STRUCTION, OF A BUSINESS ALREADY IN EXISTENCE: PROVIDED THAT THIS CONDITION SHALL NOT APPLY IN RES PECT OF AN INDUSTRIAL UNDERTAKING WHICH IS FORMED AS A RESULT OF THE RE-E STABLISHMENT, RECONSTRUCTION OR REVIVAL BY THE ASSESSEE OF THE BU SINESS OF ANY SUCH INDUSTRIAL UNDERTAKING AS IS REFERRED TO IN SECTION 33B, IN THE CIRCUMSTANCES AND WITHIN THE PERIOD SPECIFIED IN THAT SECTION; (II) IT IS NOT FORMED BY THE TRANSFER TO A NEW BUSI NESS OF MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE : (III) IT MANUFACTURES OR PRODUCES ANY ARTICLE OR TH ING, NOT BEING ANY ARTICLE OR THING SPECIFIED IN THE LIST IN THE ELEVENTH SCHEDUL E, OR OPERATES ONE OR MORE COLD STORAGE PLANT OR PLANTS, IN ANY PART OF I NDIA: ' 10. THE APPELLANT HAS CONTESTED THAT IT HAS TAKEN D G SET ON RENTAL BASIS FROM M/S. NANGALWAL IMPEX (P) LIMITED, WHICH IS ITS SISTER CONCERN. THE ELECTRICITY CONNECTION HAS BEEN OBTAINED ONLY O N 30.03.2004. THE APPELLANT HAS CLAIMED THAT OUT OF ITS TOTAL TURNOVE R OF RS.42,38,435/- ITS TURNOVER TO THE TUNE OF RS.19,12,547/- WAS POSSIBLE THROUGH GOODS MANUFACTURED IN THE APPELLANT'S OWN PREMISES. DETAI LS OF EXPENSE LIKE DIESEL PURCHASES ETC REQUIRED FOR OPERATION OF THE D G SET HAS. NOT BEEN FURNISHED. THE APPELLANT HAS NOT FURNISHED CREDIBLE EVIDENCES EITHER BEFORE THE ASSESSING OFFICER OR BEFORE ME IN THIS PROCEEDI NG THAT PART OF GOODS AS MENTIONED ABOVE HAS BEEN MANUFACTURED IN THE APPELL ANT'S FACILITY. 11. THE APPELLANT ITSELF ADMITS THAT IT DO NOT HAVE ANY FACILITY FOR THE MANUFACTURE OF RUBBER CABLE DURING THE YEAR UNDER A PPEAL, WHICH IS THE FIRST YEAR OF ITS OPERATION. THE APPELLANT HAS ALSO NOT SUPPORTED ITS ARGUMENTS BY COGENT FACTS THAT MANUFACTURING IS CAR RIED OUT UNDER THE SUPERVISION OF ITS PARTNER USING HIS KNOW HOW. I AM CONSTRAINED TO AGREE WITH THE ASSESSING OFFICER THAT M/S. NANGALWALA CHE MICAL INDUSTRIES IS DOING MANUFACTURING ACTIVITY FOR THE APPELLANT AND THE APPELLANT HAS NOT CARRIED OUT ANY MANUFACTURING ACTIVITY. THUS I AGRE E WITH THE ASSESSING OFFICER THAT THE APPELLANT CAN NOT BE SAID TO HAVE MANUFACTURED ANY ARTICLE OR THING WITHIN THE MEANING OF THE PROVISIONS OF SE CTION 80IB OF THE INCOME TAX ACT. ITA NO.3207/AHD/2007 5 12. NOW I WOULD LIKE TO DELVE INTO EACH OF THE GROU NDS OF APPEAL RAISED BY THE APPELLANT; 13. GROUND NO. 1 IS REGARDING THE ELIGIBILITY OF TH E APPELLANT FOR DEDUCTION U/S. 80IB OF THE ACT. AS DISCUSSED IN PAR AGRAPH 11 SUPRA THE APPELLANT ITSELF HAS ADMITTED THAT NO MANUFACTURING OR PRODUCTION ACTIVITIES HAS BEEN CARRIED OUT BY IT WHICH IS A MANDATORY CON DITION FOR AVAILING DEDUCTION U/S. 80IB OF THE ACT. THIS GROUND OF APPE AL IS DISMISSED. 14.1 IN GROUND NO. 2 THE APPELLANT CONTEND THAT THE ASSESSING OFFICER ERRED IN LAW AND ON FACTS IN REJECTING THE CLAIM OF THE APPELLANT IS MANUFACTURER AS THE MANUFACTURING HAS BEEN CARRIED OUT UNDER ITS DIRECT SUPERVISION AND CONTROL AND WITH THE HELP OF ITS TE CHNICAL KNOW HOW BY USING THE MANUFACTURING FACILITY OF ONE OF ITS SIST ER CONCERN. 14.2 SINCE THE APPELLANT HAS NOT FURNISHED EVIDENCE OF A CREDIBLE NATURE IN SUPPORT OF ITS THEORETICAL ARGUMENTS AND ON ACCO UNT OF THE FACT THAT THE LITERAL INTERPRETATION OF SECTION 80IB DOES NOT PER MIT ANY ARTIFICIAL DEFINITION OF MANUFACTURING OR MANUFACTURE THE APPELLANT CONTE NTION CAN NOT BE ACCEPTED. THIS GROUND OF APPEAL IS DISMISSED. 5. THE ASSESSEE IS NOW IN APPEAL BEFORE US AGAINS T THE AFORESAID FINDINGS OF THE LD. CIT(A).THE LEARNED AR ON BEHALF OF THE ASSESSEE WHILE CARRYING US THROUGH THE IMPUGNED ORDERS SUBMI TTED THAT THE ASSESSEE HAD HIRED GENERATOR FROM A SISTER CONCERN AND DIESEL EXPENSES WERE DEBITED UNDER THE HEAD REPAIR AND MAI NTENANCE. THE ASSESSEE HAD PURCHASED MACHINERY FOR RS. 13 LACS AN D THE ELECTRIC CONNECTION WAS SANCTIONED ON 30.3.2004. SINCE THE A SSESSEE DID NOT HAVE FACILITY OF MANUFACTURING RUBBER CABLES, ORDER RECEIVED BY THE ASSESSEE WAS EXECUTED THROUGH JOB WORK DONE BY M/S NAGARWALA CHEMICAL INDUSTRIES OF ALWAR. HE ADDED THAT OUT OF TOTAL TURNOVER OF ABOUT RS. 42 LACS, RS. 19,12,835/- WAS ON ACCOUNT O F PVC/TPR INSULATED WIRES AND CABLES PRODUCED IN THE ASSESSE ES OWN UNIT. SINCE THE AO DID NOT DOUBT THIS TURNOVER WHILE RUBB ER CABLES WERE MANUFACTURED UNDER THE SUPERVISION OF A PARTNER IN A SISTER CONCERN, THE LD. AR WHILE REFERRING TO CERTAIN OBSERVATIONS BY THE HONBLE APEX COURT IN CHILLIES EXPORTS HOUSE LTD VS. CIT,225 ITR 814(SC) PLEADED THAT DEDUCTION U/S 80IB IS ADMISSIBLE. THE LEARNED DR, ON THE OTHER HA ND, SUPPORTED THE ORDER OF THE LOWER AUTHORITIES AND FURTHER SUBMITTE D THAT COPIES OF ITA NO.3207/AHD/2007 6 BILLS FOR PURCHASE OF MACHINERY PLACED ON PAGE 9 & 10 OF THE PAPER BOOK REVEAL THAT MACHINERY WAS PURCHASED IN DELHI. THE ASSESSEE DID NOT SUBMIT ANY EVIDENCE OF INSTALLATION AND COM MISSIONING OF THE PLANT AND MACHINERY AND THEREFORE, COULD NOT H AVE UNDERTAKEN ANY MANUFACTURING ACTIVITY IN ITS PLANT. AS REGARDS PURCHASE ORDER FROM CHENNAI, THE LD. DR CONTENDED THAT PURCHASE OR DER IS DATED 30.12.2003 /10.1.2004.HOW COULD ASSESSEE OBTAIN THE SAID ORDER EVEN BEFORE PURCHASE OF PLANT AND MACHINERY, HAS N OT BEEN EXPLAINED BY THE ASSESSEE. AS REGARDS DIRECT SUPERV ISION OF THE JOB WORK AT ALWAR, THE LD. DR POINTED OUT THAT THERE IS NO EVIDENCE AS TO HOW THE SAID PARTNER HAD UNDERTAKEN DIRECT SUPERVIS ION AT ALWAR, WHICH IS 500KMS AWAY. INVITING OUR ATTENTION TO PAG E 29 OF THE PAPER BOOK, THE LD. DR POINTED OUT THAT THE ASSESSEE DID NOT FURNISH COPY OF INVOICES FOR TRANSPORTATION OF RAW MATERIAL PU RCHASED OR TRANSPORT OF GOODS PRODUCED THROUGH JOB WORK OR EVE N FOR SALE OF GOODS.. HE ADDED THAT ENTIRE SALE WAS SHOWN IN DEBT ORS AND NO AMOUNT WAS RECOVERED. IN THE LIGHT OF THESE FACTS, THE LD. DR CONTENDED THAT THE ASSESSEE IS NOT ENTITLED TO ANY DEDUCTION. IN HIS REJOINDER THE LD. AR SUBMITTED THAT ISSUES NOW RAI SED BY THE LD. DR DO NOT EMERGE FROM THE ORDER OF THE AO. IF PLANT AN D MACHINERY WAS NOT INSTALLED, HOW THE AO ALLOWED DEPRECIATION. SIN CE THE AO HIMSELF ACCEPTED DIRECT SUPERVISION OF JOB WORK BY THE PART NER, THERE IS NO REASON FOR DENYING DEDUCTION, THE LD. AR ADDED. 6. WE HAVE HEARD BOTH THE PARTIES AND GONE THROU GH THE FACTS OF THE CASE. A MERE GLANCE AT THE IMPUGNED ORDER REVEA LS THAT THE LD. CIT(A) UPHELD THE FINDINGS OF THE AO SINCE THE ASSE SSEE DID NOT FURNISH ANY DETAILS OF DIESEL PURCHASED FOR RUNNIN G GENERATOR OR ANY OTHER EVIDENCE THAT A PORTION OF GOODS WERE MANUFAC TURED IN THE ASSESSEES OWN FACILITY NOR ANY EVIDENCE THAT GOOD S MANUFACTURED IN THE FACILITY OF M/S NAGARWALA CHEMICAL INDUSTRI ES WERE UNDER THE SUPERVISION OF THE PARTNER USING HIS TECHNICAL KNOW HOW. THE LD. AR APPEARING BEFORE US NOW RAISED MODIFIED AND ADDIT IONAL GROUNDS, ITA NO.3207/AHD/2007 7 CONTENDING THAT PVC/TPR INSULATED WIRES AND CABLES OF THE VALUE OF RS.19,12,835/- WERE PRODUCED IN THE INDUSTRIAL UNDERTAKING OF THE ASSESSEE USING THEIR OWN MACHINERIES AND POWER GENERATED FROM DIESEL GENERATOR AND THAT EXPENSES FOR DIESEL WERE DEBITED UNDER THE HEAD REPAIR AND MAINTENANCE. IT WAS POINTED OU T THAT GOODS MANUFACTURED THROUGH JOB WORK HAVE INDEED BEEN SOLD DURING THE YEAR AND NOTHING WAS AVAILABLE IN THE CLOSING STOCK . EVEN THOUGH THE AO AND THE LD. CIT(A) HAVE CONCLUDED THAT THE A SSESSEE DID NOT UNDERTAKE ANY MANUFACTURING OR PRODUCTION ACTIVITI ES IN ITS INDUSTRIAL UNDERTAKING, THEY DID NOT DOUBT THE PURC HASE OF RAW MATERIAL AND NOWHERE CONCLUDED THAT THE ENTIRE RA W MATERIAL PURCHASED BY THE ASSESSEE WAS CONSUMED IN JOB WORK NOR EVEN DOUBTED THE WAGES DEBITED TO THE ACCOUNTS. RATHER , THE AO HAS ALLOWED EVEN DEPRECIATION ON VARIOUS ASSETS INCLUDI NG PLANT AND MACHINERY WHILE DETERMINING TOTAL INCOME AND DID N OT DOUBT THE GENUINENESS OF PURCHASE OF RAW MATERIAL OR SALE OF GOODS, CLAIMED TO HAVE BEEN MANUFACTURED BY THE ASSESSEE. IN THESE CIRCUMSTANCES, ESPECIALLY WHEN WHEN COMPLETE FACTS ARE NOT EVIDENT FROM THE RELEVANT ORDERS WHILE THE LEARN ED CIT(A) HAVE NOT RECORDED ANY FINDINGS ON THE SPECIFIC ISSUES NOW RA ISED IN THE ADDITIONAL GROUNDS RAISED BEFORE US, WE CONSIDER IT FAIR AND APPROPRI ATE TO SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO H IS FILE FOR DECIDING THE CLAIM FOR DEDUCTION U/S 80IB OF THE ACT AFRESH IN ACCORDANCE WITH LAW IN THE LIGHT OF OUR AFORESAID OBSERVATIONS AND OF COURSE, AFTER ALLOWIN G SUFFICIENT OPPORTUNITY TO BOTH THE PARTIES. THIS VIEW OF OURS IS SUPPORTED BY THE DECISION OF HONBLE MP HIGH COURT IN CIT VS.TOLLARAM HASSOMAL,298 ITR 22(MP).N EEDLESS TO SAY THAT THE LD. CIT(A) MAY HAVE ANY INDEPENDENT INQUIRIES MADE IN O RDER TO ASCERTAIN THE CORRECT FACTS, IF HE FEELS NECESSARY. WITH THESE OBSERVAT IONS, GROUND NO.1 IN THE APPEAL IS DISPOSED OF 7. NO ADDITIONAL GROUND HAVING BEEN RAISED IN TER MS OF THE RESIDUARY GROUND IN THE APPEAL, ACCORDINGLY, THIS G ROUND IS DISMISSED. ITA NO.3207/AHD/2007 8 8. IN THE RESULT, APPEAL IS ALLOWED, BUT FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT TODAY ON 12-11-2010 SD/- SD/- (BHAVNESH SAINI) JUDICIAL MEMBER (A N PAHUJA) ACCOUNTANT MEMBER DATE : 12 -11-2010 COPY OF THE ORDER FORWARDED TO: 1. M/S N CORE CABLES, GALA NO.7, PLOT NO.10, PREMIE R INDUSTRIAL AREA, KACHIGAM, DAMAN 2. ITO, VAPI WARD-4, DAMAN 3. CIT CONCERNED 4. CIT(A), VALSAD 5. DR, BENCH-C, ITAT, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABAD