ITO, BALOTRA V. M/s. Oswat Mills Exports, BALOTRA

ITA 348/JODH/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1560 (ITAT-JODHPUR)
• Duration Of Justice: 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 11-09-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: ANIL BHANSALI
• Keywords: Depreciation; Rule of consistency
• Section: 80IB

Judgement Text

1 IN THE INCOME TAX APPELALTE TRIBUNAL: JODHPUR BENCH : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 348/JU/2012 (ASSESSMENT YEAR 2006-07) THE INCOME-TAX OFFICER VS M/S OSWAL MILLS EXPORT S WARD, BALOTRA E 136, IIIRD PHASE INDUSTRIAL AREA, BALOTRA PAN NO. AABF0 0502 C (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ANIL BHANSALI DEPARTMENT BY : SH. G.R. KOKANI, DATE OF HEARING : 19/02/2013. DATE OF PRONOUNCEMENT : 07/03/2013. PER HARI OM MARATHA, J.M. : THIS APPEAL OF THE REVENUE FOR A.Y. 2006-07 IS DIR ECTED AGAINST THE ORDER OF LD. CIT(A), JODHPUR DATED 06/07/2012. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS AS TO WHETHER THE CLAIM OF DEDUCTION U/S 80 1B OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT', FOR SHORT] CAN BE DISALLO WED ONLY ON THE REASON THAT THE ASSESSEE HAS CONSUMED LESS ELECTRIC POWER WHICH ACCORDING TO A.O. IS NOT COMMENSURATE WITH ITS MANUFACTURING ACT IVITIES. IN THIS WAY 2 THE A.O. HAS DISALLOWED A SUM OF RS.17,53,253/-, BU T THE SAME HAS BEEN HELD AS ALLOWABLE BY LD. CIT(A). 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE CAREF ULLY PERUSED THE ENTIRE MATERIAL AVAILABLE ON RECORD. THE ASSES SEE-FIRM IS ENGAGED IN THE BUSINESS OF PURCHASING, PROCESSING AND SELLI NG OF GREY AND DYED CLOTH. FOR A.Y. 2006-07 THE ASSESSEE - FIRM FILED I TS RETURN OF INCOME ALONG WITH A COPY OF AUDIT REPORT OBTAINED U/S 44 A B OF THE ACT IN THE PRESCRIBED FORMAT AND ALSO WITH AUDIT REPORT U/S 80 IB IN FORM NO 10CCB ON 30/10/2006 DECLARING TOTAL INCOME OF RS. N IL AFTER CLAIMING DEDUCTION U/S 80IB(5) AMOUNTING TO RS. 17,53,235/- @ 100% OF PROFIT. IT WAS NOTICED THAT THE ASSESSEE- FIRM HAS FULFILLE D ALL THE REQUISITE CONDITIONS LAID DOWN IN SEC.80IB(2) OF THE ACT. IN THIS CASE THE ASSESSEE-FIRM HAS SHOWN SALES OF CLOTH WORTH RS. 3, 75,38,492/- AND HAS SHOWN PURCHASES OF GREY CLOTH WORTH RS. 2,68,43,548 /-. IT HAS DISCLOSED EXPENDITURE ON FUEL, INCLUDING ON FIREWOOD, AT RS. 4,21,249/- APART FROM INCURRING EXPENDITURE ON DIESEL & OIL AT RS. 2 ,02,564/-. THE A.O. HAS FOUND THESE EXPENSES TO BE INADEQUATE FOR ITS M ANUFACTURING ACTIVITIES AND ONLY ON THAT BASIS HE HAS OPINED THA T THE ASSESSEE-FIRM MUST HAVE PURCHASED READYMADE GOODS (CLOTHES) FROM THE MARKET/SISTER CONCERNS. REGARDING EMPLOYMENT OF ATL EAST TEN WORKERS, 3 THE A.O. HAS OPINED THAT PART-TIME WORKERS ARE NOT THOSE WORKERS AS ARE REQUIRED BY SECTION 80IB(2) OF THE ACT. IT IS TRUE THAT THE ISSUE OF CONSUMPTION OF POWER VIS--VIS AMOUNT OF PRODUCTION IN THIS LINE OF BUSINESS STANDS COVERED BY OUR RECENT DECISION REN DERED IN THE CASE OF INCOME-TAX OFFICER VS M/S. PTM INDUSTRIES , BALOT RA IN ITA NO. 111/JU/2011 (A.Y. 2005-06) ORDER DATED 20.12.2012, WHEN THE ASSESSEE HAS BEEN USING GEN-SET AND EXPENDITURE TOW ARDS DIESEL IS SHOWN AND THE SAME HA TO BE CONSIDERED JOINTLY TOWA RDS PRODUCTION ACTIVITIES. UNDER IDENTICAL FACTS AND CIRCUMSTANCES WE HAVE TAKEN A VIEW IN FAVOUR OF THE ASSESSEE WHILE DECIDING THE C ASE OF M/S. P.T.M. INDUSTRIES VS. ITO, BALOTRA, IN ITA NO. 111/JU/2011 A.Y. (2005-06), ORDER DATED 20.12.2012. FOR READY REFERENCE WE EXT RACT PARAS 19 TO 28 OF THE ABOVE AS UNDER: 19. AS REGARDS TO THE THIRD CONDITION, WHICH PROVI DES THAT THE INDUSTRIAL UNDERTAKING SHALL MANUFACTURE O R PRODUCE ANY ARTICLES OR THINGS IN ANY PART OF INDIA EXCEPT ARTICLES OF THINGS SPECIFIED IN ELEVENTH SCHEDULE, THE LD CIT(A) OBSERVED THAT THERE WAS NO ALLEGATION OF THE ASSESSING OFFICER THAT ITEM PRODU CED BY THE ASSESSEE WAS IN THE LIST OF ELEVENTH SCHEDU LE AND THERE WAS ALSO NO SPECIFIC ALLEGATION THAT THE ASSESSEE WAS NOT IN AN ACTIVITY OF MANUFACTURING OR PRODUCTION OF ARTICLE OR THINGS. THE LD CIT(A) POI NTED 4 OUT THAT THE PROCESS FLOW CHART AS SUBMITTED BY THE ASSESSEE REVEALED THAT THE ASSESSEE WAS MANUFACTURING PRODUCT NAMELY POPLIN OUT OF GREY CLOTH BY CARRYING OUT ACTIVITIES SUCH AS WASHING, BLEACHING, DYEING, PADDING AND RAPPING ETC. THE LD CIT(A) ALSO POINTED OUT THAT THE WORLD MANUFACTURE HAD BEEN DEFINED BY FINANCE ACT, 2009 IN SECTION 2(29BA) AND THE WORD MANUFACTURE MEANS A CHANGE IN NON LIVING PHYSICAL OBJECT OR ARTICLE OR THING A) RESULTING IN TRANSFORMATION OF THE OBJECT OR ARTICL ES OR THING INTO A NEW AND DISTINCT OBJECT OR ARTICLE OR THING HAVING A DIFFERENT NAME, CHARACTER AND USE OR B) BRINGING INTO EXISTENCE OF A NEW AND DISTINCT OB JECT OR ARTICLE OR THING WITH A DIFFERENT CHEMICAL COMPOSITION OR INTEGRAL STRUCTURE. THE LD CIT(A) OBSERVED THAT THE ASSESSEE UTILIZED GREY CLOTH AS A RAW MATERIAL AND AFTER APPLYING VARIOUS PROCESSES I N ITS FACTORY, IT PRODUCED FINISHED PRODUCT AS POPLI N WHICH IS USED BY LADIES AS UNDER GARMENT SUCH AS PATICOT AND UNIFORM DRESS FOR SCHOOL CHILDREN ETC A ND THE END PRODUCTS ARE COMPLETELY DIFFERENT TO THE RA W MATERIAL IN ITS CHARACTER AS WELL AS USES. THE LD CIT(A) REFERRED TO THE FOLLOWING DECISION OF THE HON'BLE SUPREME COURT :- I) EMPIRE INDUSTRIES LTD V UNION OF INDIA, ([162 ITR 846); AND II) UJAGAR PRINTS V UNION OF INDIA (179 ITR 317) 5 WHEREIN IT HAS BEEN HELD THAT THE PROCESSES LIKE BLEACHING, DYEING AND PRINTING OF GREY CLOTH AMOUNT S TO MANUFACTURE. 20. THE LD CIT(A) OBSERVED THAT THE ASSESSEE PURCHA SED BALES OF RAW FABRIC I.E. GREY CLOTH AND EACH OF TH E BALES CONTAINED SEVERAL HUNDRED / THOUSAND METERS OF RAW FABRIC CLOTH. THE ASSESSEE BY VARIOUS PROCESS AND BY USING AND CONSUMING VARIOUS OTHER RAW MATERIALS LIK E, COLOURS AND CHEMICALS ETC. OBTAINED FINISHED PRODUC T WHICH WERE SOLD IN THE MARKET IN A DIFFERENT NAME T HEN THAT OF RAW MATERIAL USED AND THE USE OF RAW MATERI AL I.E RAW OF FABRIC HAD NOT NO RLEVASNTY AND CONNEC TIVITY WITH THE USE OF FINISHED GOODS PRODUCED AND MARKETE D BY THE ASSESSEE I.E. POLPLIN WHICH WAS SOLD IN TH ANS AND METERS AND NOT IN BALES. THE LD CIT(A) REFEREE D TO THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CA SE OF INDIA CINE AGENOIS VS. CIT REPORTED IN 175 TAXMA N 361 (SC) AND THE DECISION OF THE ITAT MUMBAI BENCH IN THE CASE OF SHAH ORIGINALS VS. ACIT, REPORTED IN 19 SOT 568 AND OBSERVED THAT THE ASSESSEE CARRIED OUT THE WORK OF WASHING BY JOB WORK AND ITSELF CARRIED OUT THE BLEACHING, DYEING AND PADDING TO PRODUCE FINISHED PRODUCT NAMELY POPLIN. THE LD CIT(A) FURTHER OBSER VED THAT THE VARIOUS GOVERNMENT AUTHORITIES SUCH AS CEN TRAL EXCISE, FACTORY AUTHORITIES, INDUSTRIAL DEPARTMENT AND 6 ESI AUTHORITIES HAVE ACCEPTED THE ASSESSEE CONCERN AS AN INDUSTRIAL UNDERTAKING ENGAGED IN THE BUSINESS OF MANUFACTURE AND PRODUCTION OF FINISHED PRODUCTS NAM ELY POPLIN OUT OF GREY CLOTH WHICH WAS DIFFERENT ARTI CLE OR THING FROM GREY CLOTH. HE, THEREFORE, HELD THAT THE ASSESSEE WAS MANUFACTURING THE FINISHED PRODUCT NAM ELY POPLIN FROM GREY CLOTH AND ACCORDINGLY IT FULFILLE D THE THIRD CONDITION OF THE PROVISIONS OF SECTION 80IB(2 ) OF THE ACT. 21. AS REGARDS TO THE LAST CONDITION, WHICH REQUIRE S THAT THE INDUSTRIAL UNDERTAKING SHALL MANUFACTURE OR PRODUCE ARTICLE OF THINGS BY EMPLOYING 10 OR MORE WORKERS IN THE MANUFACTURING PROCESS CARRIED OUT WI TH THE AID OF POWER OR EMPLOY 20 OR MORE WORKERS WITHO UT THE AID OF POWER, THE LD CIT(A) OBSERVED THAT BEFOR E THE ASSESSING OFFICER AS WELL AS BEFORE HIM, THE ASSESS EE FILED COPY OF LEDGER ACCOUNT FOR PAYMENT OF SALARY AND WAGES ALONGWITH COPY OF WAGES REGISTER PRESCRIBING NAME OF THE WORKERS, BASIC RATE, DEDUCTION OF ESI, PF, EPS, LOAN OR ADVANCES, NET PAYABLE AND SIGNATURE OF WORKERS WHICH REVEALED THAT THE ASSESSEE HAD EMPLOY ED 12 WORKERS IN THE MONTH OF APRIL 2004 AND WAS CONTINUOUSLY HAVING TILL THE END OF THE FINANCIAL Y EAR RELEVANT TO THE ASSESSMENT YEAR 2005-06, MORE THAN 10 WORKERS AND HAD DEDUCTED ESI ON PAYMENT OF WAGES AN D THE COPIES OF CHALLANS OF PAYMENTS OF ESI WERE FURNISHED. THE LD CIT(A) POINTED OUT THAT AS PER 7 EMPLOYEES STATE INSURANCE ACT, 1948, AN ESTABLISHME NT WHO EMPLOYS MORE THAN 10 WORKERS, AND ENGAGE IN MANUFACTURING, THE ACT WAS APPLICABLE AND IN ASSESS EES CASE, AN INSPECTION BY THE OFFICER OF EMPLOYEES STA TE INSURANCE CORPORATION, JAIPUR WAS CARRIED OUT IN TH E MONTH OF APRIL, 2004 AND IT WAS FOUND THAT 12 WORKE RS WERE WORKING IN THE FACTORY PREMISES OF THE ASSESSE E AND ACCORDINGLY IT WAS DIRECTED TO GET REGISTRATION UNDER ESI ACT. THE LD CIT(A) POINTED OUT THAT THE ASSESS EE FURNISHED ITS APPLICATION FOR REGISTRATION UNDER ES I ACT MENTIONING THAT IT HAD EMPLOYED MORE THAN 12 WORKER S IN ITS FACTORY PREMISES. THE LD CIT(A) DISCUSSED T HE DEFINITION OF FACTORY GIVEN IN ESI ACT, 1948 AND TH E MEANING OF POWER AS DEFINED IN EMPLOYEES STATE INSURANCE ACT, 1984 AND CAME TO THE CONCLUSION THAT THE ASSESSEE HAD TAKEN POWER CONNECTION AND UTILIZED ELECTRICITY WHICH WAS MEASURED IN UNITS AND BILLS FOR EXPENSES WERE ISSUED BY RSEB DURING THE YEAR UNDER CONSIDERATION FOR MANUFACTURING / PROCESSING OF CLO TH AND THAT THE ASSESSEE OBTAINED CERTIFICATE FROM THE ESIC, JAIPUR AND WAS DEDUCTING ESI STARTING FROM AP RIL, 2004 IN RESPECT OF 12 WORKER EMPLOYED IN THE FACTOR Y FOR MANUFACTURING OF THE FINISHED GOODS WITH THE AID OF POWER AND THE SAME WAS PAID TO THE ESIC. HE ALSO OBSERVED THAT THE ASSESSEE OBTAINED A CERTIFICATE F ROM THE DEPARTMENT OF FACTORY AND BOILERS SHOWING 12 WORKERS AND UTILIZATION OF POWER UP TO 4 H.P. FOR MANUFACTURING OF FINISHED GOODS AND ALSO OBTAINED 8 CERTIFICATE FROM DISTRICT INDUSTRIAL SUB CENTRE, B ALTORA FOR CLOTH DYEING WITH JIGGER AND FINISHING OF GOODS WITH BLEACHING, PADDING AND RAPPING ETC. ACCORDING TO L D CIT(A), THE ABOVE REGISTRATIONS AND REQUIREMENTS OF VARIOUS GOVERNMENT DEPARTMENTS FOR GRANTING CERTIIC ATES CLEARLY SHOWED THAT THE ASSESSEE HAD EMPLOYED / UTILIZED MORE THAN 10 WORKERS FOR CARRYING OUT MANUFACTURING PROCESS WITH THE AID OF POWER IN THE YEAR UNDER CONSIDERATION. THE LD CIT(A) ALSO OBSERVED T HAT THE ASSESSEE INCURRED ELECTRICITY EXPENSES OF RS. 70,640/- AND GENERATOR EXPENSES OF RS. 1,23,355/- F OR THE PURPOSE OF MANUFACTURING OF GOODS AS WELL AS FO R OFFICE, FOLDING, PACKING OF FINISHED GOODS IN HALL BY UTILIZING FAN, TUBE LIGHTS AND IN OFFICE USE, SO TH ERE WAS NO DISPUTE THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE HAD USED ELECTRICITY THOUGH ACCORDING TO ASSESSING OFFICER IT WAS VERY LESS OR NOMINAL. HOW EVER, FACT REMAINED THAT THE ASSESSEE WAS UTILIZING POWER TO PROCESS / MANUFACTURING POPLIN OUT OF GREY CLOTH. 22. THE LD CIT(A) OBSERVED THAT IN THE ASSESSEES PROCESS, THE REQUIREMENT OF CONSUMPTION OF ELECTRIC ITY WAS VERY LESS AS NO BIG PLANT AND MACHINERY OR ESTABLISHMENT WERE REQUIRED EXCEPT USE OF ELECTRICI TY IN RUNNING OF SMALL HORSE POWER MOTORS FOR OPERATIONS OF JIGGER, MIXTURES, PADDING ETC. THEREFORE, ON THE BA SIS OF ELECTRICITY EXPENSES, IT CANNOT BE SAID THAT THE AS SESSEE WAS NOT ENGAGED IN THE MANUFACTURING ACTIVITY. 9 RELIANCE WAS PLACED ON THE DECISION OF THE ITAT CHANDIGARH IN THE CASE OF M/S SHOGI COMMUNICATION V S DCIT, REPORTED IN 009 SOT 0489. THE LD CIT(A) POIN TED OUT THAT AS PER THE LAID DOWN PLAN, A 2 HORSE POWE R MOTOR CONSUMES 1.5 UNIT OF ELECTRICITY PER HOUR AND A ONE AND HALF H.P. MOTOR INSTALLED FOR PADDING PROCE SS CONSUME ONE UNIT OF ELECTRICITY PER HOUR AND ONE HO RSE POWER WATER PUMP CONSUME ONE UNIT IN ONE HOUR ONLY. AS THE ASSESSEES FACTORY WORKED IN SINGLE SHIFT OF EIGHT HOUR, IT CONSUMED ELECTRICITY NOT MORE THAN 28 UNIT S PER DAY. HE FURTHER OBSERVED THAT THE CLOTH WAS DILUTE D WITH BOILED WATER WHICH WAS BOILED WITH THE AID OF FUEL, THEREFORE, IT WOULD BE CLEAR THAT THE ELECTRICITY EXPENSES AND GENERATOR EXPENSES DEBITED IN THE PROF IT AND LOSS ACCOUNT WERE SUFFICIENT TO PRODUCE SALE SH OWN IN PROFIT AND LOSS ACCOUNT. THE RELIANCE WAS PLACE D ON THE DECISION OF THE ITAT MUMBAI IN THE CASE OF SHRE E PAR FRAGRANCE P. LTD VS. ITO REPORTED IN 20 SOT 440. T HE LD CIT(A) HELD THAT THE ASSESSEE HAD EMPLOYED MORE THA N 10 WORKERS IN ITS FACTORY PREMISES AND HAD UTILIZED POWER IN MANUFACTURING PROCESS TO PRODUCE FINISHED GOODS OUT OF GREY CLOTH I.E. POPLIN. THE LD CIT( A) POINTED OUT THAT THE ASSESSEE HAD CONSUMED COLOUR, CHEMICAL, PACKING MATERIAL AND FUEL AMOUNTING TO RS . 90,13,295/- AND INCURRED MANUFACTURING AND PROCESSI NG EXPENDITURE OF RS. 53.43,947/- IN ADDITION TO PURCH ASE OF RAW MATERIAL OF RS. 7,29,49,642/- AND HAD SHOWN CLOSING STOCK TO THE EXTENT OF RS. 1,21,66,830/-. HE ALSO 10 POINTED OUT THAT THE ASSESSEE HAD CLAIMED PAYMENT O F ESI AMOUNTING TO RS. 26,398/- WHICH CLEARLY SHOWED THAT THE ASSESSEE WAS ENGAGED IN MANUFACTURING / PROCES SING OF FINISHED GOODS NAMELY POPLIN OUT OF GREY CLOTH BY SUBJECTING ON VARIOUS PROCESSES WITH THE AID OF POW ER AND EMPLOYED MORE THAN 10 WORKERS IN THE FINANCIAL YEAR UNDER CONSIDERATION, THEREFORE, THE ASSESSEE FULFILLED FOUR CONDITIONS PRESCRIBED IN SECTION 80I B(2) OF THE INCOME TAX ACT, 1961. THE LD CIT(A) POINTED OU T THAT THE ASSESSING OFFICER IN SETTING ASIDE THE ASSESSMENT ORDER HAD OBSERVED THAT WITH THE SMALLN ESS OF ELECTRICITY EXPENSES, THE ASSESSEE COULD NOT PRO DUCE AND SOLD GOODS WORTH OF RS. 8.01 CRORES ON THIS OBSERVATION, THE LD CIT(A) STATED THAT THE ASSESSIN G OFFICER HAD NOT BROUGHT ANY EVIDENCE ON RECORD FOR HIS FINDINGS WHICH WAS BASED ON SURMISES AND PRESUMPTIO N AND THAT FROM THE DETAILS GIVEN IN THE PROFIT AND L OSS ACCOUNT, THE ASSESSEE HAD PURCHASED GREY CLOTH TO THE TUNE OF RS. 7.29 CRORES AND HAD UTILIZED VARIOUS CONSUMABLES IN THE PROCESS OF MANUFACTURING OF FINI SHED GOODS WHICH HAD NOT BEEN DISPUTED BY THE ASSESSING OFFICER. HE ALSO OBSERVED THAT THE ASSESSEE FURNISH ED DETAILS OF CAPACITY OF PRODUCTION OF FINISHED GOODS OF THE ASSESSEES UNDERTAKING, WHICH REVEALED THAT THE ASSESSEE COULD PROCESS / MANUFACTURE 99 LAKHS METER S OF GREY CLOTH OF WORTH OF RS. 14.85 CRORES BY APPLYING SELLING PRICE AT RS. 15/- WHEREAS THE ASSESSEE HAD SHOWN SALES OF RS. 8.01 CORES AND THE ASSESSING OFFICER H AD NOT 11 BROUGHT ON RECORD ANY EVIDENCE TO SUGGEST ANY TRAN SFER ENTRY OF FINISHED GOODS EITHER FROM THE SISTER CONC ERN OR BY WAY OF UNACCOUNTED PURCHASES, THEREFORE, IN THE ABSENCE OF ANY DOCUMENTARY EVIDENCE OR PROPER VERIFICATION OF FACTS AND BRINGING PRIMARY FACTS O N RECORD, THE FINDINGS OF ASSESSING OFFICER THAT THE ASSESSEE MIGHT HAVE PURCHASED OR TRANSFERRED GOODS FROM SISTER CONCERN, HAVE TO BE IGNORED. RELIANCE W AS PLACED ON THE DECISION OF ITAT JAIPUR IN THE CASE OF DCIT VS ASSOCIATED STONE INDUSTRIES, KOTA LTD REPOR TED IN XXII TAXWORLD 155. THE LD CIT(A) HELD THAT THE ASSESSEE FULFILLED THE CONDITIONS LAID DOWN IN THE PROVISIONS OF SECTION 80IB(2) OF THE ACT AND WAS E LIGIBLE FOR DEDUCTION U/S 80IB OF THE ACT AS WAS ALLOWED IN THE ORIGINAL ASSESSMENT ORDER DATED 27.9.2006. HE ACCORDINGLY DIRECTED THE ASSESSING OFFICER TO ALLOW DEDUCTION OF RS. 28,63,551/-. NOW, THE DEPARTMENT IS IN APPEAL. 23. THE LD. DR STRONGLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND FURTHER SUBMITTED THAT THE ASSESSEE PURCHASED THE PLANT AND MACHINERY IN THE MONTH OF FEBRUARY ONLY, SO, IT WAS NOT POSSIBLE TO ACHIEVE THE TURNOVER SHOWN BY THE ASSESSEE. IT WAS FURTHER STATED THAT NO DETAIL OF EXPENSES WAS FURNI SHED BY THE ASSESSEE AND THE COST OF THE ELECTRICITY WAS VERY LOW FOR THE PRODUCTION CLAIMED TO HAVE BEEN ACHIEVE D BY THE ASSESSEE. THEREFORE, THE ASSESSING OFFICER WAS FULLY 12 JUSTIFIED IN DISALLOWING THE CLAIM OF THE ASSESSEE FOR THE DEDUCTION U/S 80IB OF THE ACT. 24. IN HIS RIVAL SUBMISSIONS, LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND STRONGLY SUPPORTED THE IMPUG NED ORDER PASSED BY THE LD CIT(A). IT WAS FURTHER STA TED THAT THE ASSESSEE WAS ENGAGED IN THE PRODUCTION OF POPLIN CLOTH AND MACHINERY WERE INSTALLED TO ACHI EVE THE TURN OVER. IT WAS CONTENDED THAT THE ASSESSEE ENGAGED SUFFICIENT NUMBER OF LABOURERS AND ALSO USE D THE ELECTRICITY TO RUN THE UNIT AND THAT THE EXPENS ES WERE INCURRED ON LABOUR ENGAGED IN MANUFACTURING PROCESS FOR DYEING, PADDING, RAPPING, BALES PACKING ETC. AND THE MONTHLY WAGES / SALARY PER WORKER FAIRLY COMMENSURATE WITH THE WAGE RATE PREVAILING IN THE MARKET DURING THE RELEVANT YEAR. IT WAS FURTHER ST ATED THAT THE ASSESSEE FILED THE AUDIT REPORT IN FORM NO . 10CCB TO CLAIM THE DEDUCTION U/S 80IB AND FULFILLED ALL THE CONDITIONS AND THE CLAIM WAS ALLOWED BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEE DINGS. IT WAS STATED THAT THE ASSESSEE EXPLAINED TO THE ASSESSING OFFICER THAT HOW THE PRODUCTION WAS ACHIE VED, THE SAME HAS BEEN DISCUSSED AT PAGE NO.5 OF THE ASSESSMENT ORDER. IT WAS CONTENDED THAT THE ASSESS EE WAS HAVING GENERATOR WHICH WAS USED WHEN THE ELECTRICAL POWER WAS NOT AVAILABLE TO OPERATE MOTOR FOR RUNNING THE JIGGER AND THE EXPENSES INCURRED ON ELECTRICITY WERE SUFFICIENT TO ACHIEVE THE TURN OVE R 13 SHOWN BY THE ASSESSEE, THEREFORE, THE ASSESSING OFF ICER WAS NOT JUSTIFIED IN OBSERVING THAT ELECTRICITY CONSUMPTION BY THE ASSESSEE WAS NOT SUFFICIENT TO ACHIEVE THE TURNOVER AND IN DENYING THE DEDUCTION CLAIMED BY THE ASSESSEE ONLY ON THAT BASIS. IT WAS CONTENDED THAT CLAIM FOR DEDUCTION U/S 80IB OF THE ACT WAS ALLOWED BY THE ASSESSING OFFICER FOR PRECEDING ASSESSMENT YEAR I.E. ASSESSMENT YEAR 2004-05, SO TH ERE WAS NO REASON TO DEVIATE FOR THE YEAR UNDER CONSIDERATION WHEN THE ACTIVITIES OF THE ASSESSEE F OR BOTH THE YEARS WERE SAME. RELIANCE WAS PLACED ON TH E DECISION OF THE ITAT, LUCKNOW B BENCH IN THE CASE OF TAHREEM ELECTRICALS (P) LTD VS. ACIT (2007)112 TTJ 586. RELIANCE WAS ALSO PLACED ON THE JUDGMENT OF THE HON 'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF M/S GRACE EXPORTS, AMBERI, UDAIPUR VS. ITO, WARD-2(1), UDAIPU R IN ITA NO. 16/2010 ORDER DATED 29.8.2012. COPY OF THE SAME WAS FURNISHED WHICH IS AVAILABLE ON RECORD. 25. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIALS AVAILABLE ON RECORD. IN THE PRESENT CASE, THE ASSE SSEE CLAIMED THE DEDUCTION U/S 80IB OF THE ACT. THE PROVISIONS CONTAINED IN THE SECTION 80IB(2) OF THE ACT WHICH ARE ESSENTIAL TO CLAIM THE DEDUCTION U/S 80IB (5) OF THE ACT ARE FOLLOWING:- 14 DEDUCTION IN RESPECT OF PROFITS AND GAINS FROM CERTAIN INDUSTRIAL UNDERTAKINGS OTHER THAN INFRASTRUCTURE DEVELOPMENT UNDERTAKINGS. 80-IB. (2) THIS SECTION APPLIES TO ANY INDUSTRIAL UNDERTA KING WHICH FULFILS ALL THE FOLLOWING CONDITIONS, NAMELY: (I) IT IS NOT FORMED BY SPLITTING UP, OR THE RECONSTRUCTION, OF A BUSINESS ALREADY IN EXISTENCE : PROVIDED THAT THIS CONDITION SHALL NOT APPLY IN RESPECT OF AN INDUSTRIAL UNDERTAKING WHICH IS FORME D AS A RESULT OF THE RE-ESTABLISHMENT, RECONSTRUCTION OR REVIVAL BY THE ASSESSEE OF THE BUSINESS OF ANY SUCH INDUSTRIAL UNDERTAKING AS IS REFERRED TO IN SECTION 33B , IN THE CIRCUMSTANCES AND WITHIN THE PERIOD SPECIFIE D IN THAT SECTION; (II) IT IS NOT FORMED BY THE TRANSFER TO A NEW BUSINESS 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 LIS T IN THE ELEVENTH SCHEDULE, OR OPERATES ONE OR MORE COLD STORAGE PLANT OR PLANTS, IN ANY PART OF INDIA : PROVIDED THAT THE CONDITION IN THIS CLAUSE SHALL, IN RELATION TO A SMALL SCALE INDUSTRIAL UNDERTAKING OR AN 15 INDUSTRIAL UNDERTAKING REFERRED TO IN SUB-SECTION ( 4) SHALL APPLY AS IF THE WORDS 'NOT BEING ANY ARTICLE OR THING SPECIFIED IN THE LIST IN THE ELEVENTH SCHEDUL E' HAD BEEN OMITTED. EXPLANATION 1.FOR THE PURPOSES OF CLAUSE (II), ANY MACHINERY OR PLANT WHICH WAS USED OUTSIDE INDIA BY ANY PERSON OTHER THAN THE ASSESSEE SHALL NOT BE REGARDED AS MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE, IF THE FOLLOWING CONDITIONS ARE FULFIL LED, NAMELY : (A) SUCH MACHINERY OR PLANT WAS NOT, AT ANY TIME PREVIOUS TO THE DATE OF THE INSTALLATION BY THE ASSESSEE, USED IN INDIA; (B) SUCH MACHINERY OR PLANT IS IMPORTED INTO INDI A FROM ANY COUNTRY OUTSIDE INDIA; AND (C) NO DEDUCTION ON ACCOUNT OF DEPRECIATION IN RESPECT OF SUCH MACHINERY OR PLANT HAS BEEN ALLOWED OR IS ALLOWABLE UNDER THE PROVISIONS OF THIS ACT IN COMPUTING THE TOTAL INCOME OF ANY PERSON FOR ANY PERIOD PRIOR TO THE DATE OF THE INSTALLATION OF THE MACHINERY OR PLANT BY THE ASSESSEE. EXPLANATION 2.WHERE IN THE CASE OF AN INDUSTRIAL UNDERTAKING, ANY MACHINERY OR PLANT OR ANY PART THEREOF PREVIOUSLY USED FOR ANY PURPOSE IS TRANSFER RED TO A NEW BUSINESS AND THE TOTAL VALUE OF THE MACHINERY OR PLANT OR PART SO TRANSFERRED DOES NOT 16 EXCEED TWENTY PER CENT OF THE TOTAL VALUE OF THE MACHINERY OR PLANT USED IN THE BUSINESS, THEN, FOR THE PURPOSES OF CLAUSE (II) OF THIS SUB-SECTION, THE CONDITION SPECIFIED THEREIN SHALL BE DEEMED TO HAVE BEEN COMPLIED WITH; (IV) IN A CASE WHERE THE INDUSTRIAL UNDERTAKING MANUFACTURES OR PRODUCES ARTICLES OR THINGS, THE UNDERTAKING EMPLOYS TEN OR MORE WORKERS IN A MANUFACTURING PROCESS CARRIED ON WITH THE AID OF POWER, OR EMPLOYS TWENTY OR MORE WORKERS IN A MANUFACTURING PROCESS CARRIED ON WITHOUT THE AID OF POWER. 26. FROM THE ABOVE PROVISIONS IT IS CLEAR THAT THE FIRST CONDITION TO BE FULFILLED IS THAT THE ASSESSEE SHAL L NOT BE FORMED BY SPLITTING OR RECONSTRUCTION OF A BUSIN ESS ALREADY IN EXISTENCE. IN THE PRESENT CASE, NOTHING WAS BROUGHT ON RECORD TO SUBSTANTIATE THAT THE ASSESSEE WAS FORMED BY SPLITTING OR RECONSTRUCTION OF A BUSINESS ALREADY IN EXISTENCE. THE ASSESSEE INSTALLED ITS MACHINERY AT THE PREMISES SITUATED AT E-4, IST PHAS E, INDUSTRIAL AREA, BALOTRA AND E-3, RIICO, INDUSTRIAL AREA, PHASE-3, BALOTRA FOR MANUFACTURING OF POPLIN FROM GREY CLOTH. THE LD CIT(A) CATEGORICALLY STATED IN PARA 6.6 OF THE IMPUGNED ORDER THAT BALOTRA IS IN BARMER DISTRICT WHICH IS DECLARED AS INDUSTRIALLY BACKWAR D DISTRICT AS PER NOTIFICATION NO.714 (E) DATED 7.10. 1997 17 ISSUED BY THE CBDT IN ACCORDANCE WITH THE PROVISION S OF SECTION 80IB(5) OF THE ACT. THE ASSESSEE INSTALLED PLANT AND MACHINERY IN THE PRECEDING YEARS RELEVANT TO TH E ASSESSMENT YEARS 2003-04 AND 2004-05, SO THERE WAS NO MERIT IN THIS CONTENTION OF THE LD DR THAT THE MACHINERY WAS INSTALLED IN THE MONTH OF FEBRUARY 20 05 AND IT WAS NOT POSSIBLE TO ACHIEVE THE TURNOVER OF RS. 8.01 CRORES. IN THE PRESENT CASE, THE ASSESSEE HAD TAKEN ONE VACANT PLOT AND ANOTHER WITH OFFICE BUILDING & TAKEN ELECTRIC CONNECTION FROM SHRI PURSHOTTAM DASS AND M/S PURSHOTTAM TEXTILES. THE INDUSTRIAL UNDERTAKIN G WAS ESTABLISHED BY THE ASSESSEE AND MANUFACTURING ACTIVITIES WERE STARTED, AS SUCH, THE ASSESSEE FULF ILLED THE FIRST CONDITION OF SECTION 80IB(2) OF THE ACT. AS PER THE SECOND CONDITION, THE INDUSTRIAL UNDERTAKING SH OULD NOT BE FORMED BY TRANSFER OF A NEW BUSINESS MACHINE RY OR PLANT PREVIOUSLY USED FOR ANY BUSINESS. IN THE PRESENT CASE, THE ASSESSEE HAD TAKEN A NEW MACHINER Y TO ESTABLISH A NEW INDUSTRIAL UNDERTAKING AND NOTHING CONTRARY WAS BROUGHT ON RECORD, THEREFORE, THE ASSE SSEE FULFILLED THE SECOND CONDITION ALSO. THE THIRD CON DITION IS THAT THE ASSESSEE MUST MANUFACTURE OR PRODUCE AN Y ARTICLE OR THING IN ANY PART OF INDIA EXCEPT THE AR TICLES OR THINGS SPECIFIED IN 11 TH SCHEDULE. IN THE PRESENT CASE, THE ASSESSEE MANUFACTURED POPLIN I.E. FINISHED PRODUCT OUT OF GREY CLOTH I.E RAW MATERIAL BY CARRY ING OUT ACTIVITIES SUCH AS WASHING, BLEACHING, DYEING, PADDING AND RAPPING ETC. AND THE FINISHED PRODUCT I S 18 ALTOGETHER DIFFERENT FROM THE RAW MATERIAL IN ITS PROPERTIES AND EVEN THE DEPARTMENT IN THE PRECEDING YEAR HAS ALLOWED THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80IB OF THE ACT BY CONSIDERING THAT T HE ASSESSEE WAS ENGAGED IN MANUFACTURING ACTIVITIES. MOREOVER, THE VARIOUS GOVERNMENT AUTHORITIES SUCH A S CENTRAL EXCISE, INDUSTRIAL DEPARTMENT, ESI AUTHORIT IES ETC. HAVE ACCEPTED BY ISSUING THE VARIOUS CERTIFICA TES THAT THE ASSESSEE IS AN INDUSTRIAL UNDERTAKING ENGA GED IN THE BUSINESS OF MANUFACTURING OR PRODUCTION OF FINI SHED PRODUCT NAMELY POPLIN OUT OF GREY CLOTH, WHICH IS A DIFFERENT ARTICLE OR THING FROM THE RAW MATERIAL, THEREFORE, THE ASSESSEE ALSO FULFILLED THE THIRD CO NDITION LAID DOWN IN SECTION 80IB (2) OF THE ACT. THE FOUR TH AND LAST CONDITION PROVIDES THAT THE INDUSTRIAL UNDERTA KING MUST EMPLOY 10 OR MORE WORKERS, IF MANUFACTURING PROCESS IS CARRIED OUT WITH THE AID OF POWER OR EMP LOY 20 OR MORE WORKERS IF THE MANUFACTURING PROCESS IS WITHOUT AID OF POWER. IN THE PRESENT CASE, THE LD CIT(A) AFTER VERIFYING FROM THE WAGES REGISTER FOUND THAT 12 WORKERS WERE WORKING CONTINUOUSLY FORM APRIL, 2004 TO THE END OF THE FINANCIAL YEAR RELEVANT TO ASSESSMEN T YEAR UNDER CONSIDERATION. THEREFORE, THE ASSESSEE FULFILLED THE CONDITION OF EMPLOYING MORE THAN 10 WORKERS AND MANUFACTURE THE GOODS WITH THE AID OF POWER. THE ASSESSEE DEDUCTED ESI ON THE PAYMENT OF WAGES TO THE WORKERS AND ESI ACT IS APPLICABLE ON T HE FACTORY WHICH IS ESTABLISHED AND ENGAGED IN 19 MANUFACTURING OF GOODS BY EMPLOYING MORE THAN 10 WORKERS. IN THE PRESENT CASE, THE ASSESSEE OBTAINE D A CERTIFICATES FROM THE DEPARTMENT OF FACTORY AND BO ILER SHOWING THAT THE ASSESSEE WAS HAVING 12 WORKERS, UTILIZED THE POWER UP TO 4 H.P. FOR MANUFACTURING OF FINISHED GOODS. THE SAID CERTIFICATE IS NOT DOUBTED AT ANY STAGE, THEREFORE, THE ASSESSEE ALSO FULFILLED T HE FOURTH CONDITION LAID DOWN IN SECTION 80IB(2) OF TH E ACT TO CLAIM THE DEDUCTION U/S 80IB(5) OF THE ACT. IN THE PRESENT CASE, THE MAIN OBJECTION OF THE ASSESSING OFFICER FOR DENYING THE DEDUCTION U/S 80IB OF THE ACT WAS THAT IT WAS NOT POSSIBLE FOR THE ASSESSEE TO AC HIEVE THE TURN OVER OF RS. 8,01,81,703/- WITH ELECTRICITY CONSUMPTION OF RS. 70,982/- ONLY. IN THIS REGARD, THE EXPLANATION OF THE ASSESSEE WAS THAT APART FROM THE ELECTRICITY EXPENSES OF RS. 70,640/-, GENERATOR EXP ENSE OF RS. 1,23,355/- WERE INCURRED WHICH WERE SUFFICIE NT TO RUN 4 H.P. MACHINE REQUIRED TO RUN 15 JIGGERS, WHI CH WAS CONNECTED WITH THE SHAFT FUNCTIONING WITH 2 H. P. MOTOR AND FOR PADDING PROCESS, ONE AND HALF HORSE POWER WAS SUFFICIENT. AS PER THE LAY OUT PLAN, A TW O HORSE POWER MOTOR CONSUMES 1.5 UNIT OF ELECTRICITY PER HOUR AND FOR PADDING PROCESS, ONE AND A HALF H.P. M OTOR CONSUME ONE UNIT OF ELECTRICITY PER HOUR. ANOTHER M OTOR OF ONE HORSE POWER USED FOR WATER PUMP CONSUMES ONE UNIT IN ONE HOUR AND THE ASSESSEE WAS RUNNING THE FACTORY ON SINGLE SHIFT BASIS OF EIGHT HOURS, THERE FORE, CONSUMPTION OF ELECTRICITY WOULD NOT BE MORE THAN 2 8 20 UNITS PER DAY. WHILE PROCESSING THE CLOTH, BOILED WATER WAS REQUIRED WHICH WAS OBTAINED WITH THE AID OF FUE L AND THE ASSESSEE INCURRED EXPENSES OF RS. 5,53,948/ - ON ACCOUNT OF FUEL CHARGES. WE, THEREFORE, DO NOT SEE ANY JUSTIFICATION ON THE PART OF ASSESSING OFFICER WHIL E PRESUMING THAT THE EXPENSES CLAIMED BY THE ASSESSEE ON ACCOUNT OF ELECTRICITY WERE NOT SUFFICIENT TO ACHIE VE THE TURN OVER SHOWN BY IT. IN THE PRESENT CASE, THE ASSESSING OFFICER ACCEPTED THE PURCHASE OF GREY CLO TH WHICH WAS USED AS A RAW MATERIAL OF THE FINISHED PRODUCT I.E POPLIN WHICH WAS OBTAINED AFTER APPLY ING VARIOUS PROCESSES LIKE PADDING, WASHING, DYEING, FURNISHING AND WRAPPING OF THE CLOTH. THE ASSESSING OFFICER ALSO ACCEPTED THE SALE OF THE FINISHED GOOD S SHOWN BY THE ASSESSEE, SO THERE WAS NO REASON TO DE NY THE CLAIM OF DEDUCTION U/S 80-IB(5) OF THE ACT WHEN THE ASSESSEE FULFILLED ALL THE CONDITIONS LAID DOWN IN THE PROVISIONS OF SECTION 80IB(2) OF THE ACT. IN THE P RESENT CASE, THE ASSESSING OFFICER ALTHOUGH ALLEGED THAT T HE ASSESSEE MIGHT HAVE PURCHASED A FINISHED PRODUCT FR OM OTHER SOURCES AND DID NOT MANUFACTURE IN ITS UNIT, HOWEVER, THE PURCHASE OF GREY CLOTH WHICH IS A RAW MATERIAL IN THE ASSESSEES INDUSTRIAL UNDERTAKING H AS NOT BEEN DOUBTED. IT IS NOT THE CASE OF THE ASSESSING OFFICER THAT THE ASSESSEE SOLD THE GREY CLOTH IN RA W FORM AND DID NOT USE THE SAME IN MANUFACTURING POPLIN WHICH IS THE FINISHED PRODUCT. THEREFORE, THE ASSE SSING OFFICER WAS NOT JUSTIFIED WHILE ALLEGING THAT THE 21 POSSIBILITY OF ASSESSEES PURCHASING READY GOODS FR OM THE MARKET / SISTER CONCERN COULD NOT BE DENIED. FURTHERMORE, THE ASSESSING OFFICER ACCEPTED THE CLA IM OF THE ASSESSEE IN THE PRECEDING YEAR AND ALLOWED DEDUCTION U/S 80IB OF THE ACT. THEREFORE, KEEPING IN VIEW THE PRINCIPLE OF CONSISTENCY, THE DEDUCTION CO ULD NOT HAVE BEEN DISALLOWED FOR THE YEAR UNDER CONSIDERATION AS PER RATIO LAID DOWN BY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF M/S GRACE EXPORTS, AMBERI, UDAIPUR VS. ITO, WARD-2(1), UDAIPU R (SUPRA), WHEREIN IT HAS BEEN LAID DOWN AS UNDER:- IN VIEW OF WHAT HAS BEEN FOUND HEREINABOVE IN QUESTION NO.1 THERE APPEARS NO NECESSITY OF MUCH DILATATION ON QUESTION NO.2. SUFFICE IS TO OBSERVE THAT IF THE BENEFITS HAVE BEEN GRANTED FOR THE ABOVE YEAR 2003-04 UNDER SECTION 10-B OF THE ACT; AND THE BENEFIT IS AVAILABLE FOR A BLOCK OF 10 YEARS, IT CANNOT, ORDINARILY, BE WITHDRAWN WHEN THE NATURE OF WORK AND BENEFIT REMAIN THE SAME. 27. IN THE PRESENT CASE ALSO, THE DEDUCTION U/S 80I B IS AVAILABLE FOR TEN CONSECUTIVE ASSESSMENT YEARS AND THE ASSESSEE CLAIMED THE DEDUCTION FIRST TIME FOR THE ASSESSMENT YEAR 2004-05, THEREFORE, THE BENEFIT WAS AVAILABLE TO THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION WHEN NOTHING WAS BROUGHT ON RECORD TO SUBSTANTIATE THAT THERE WAS CHANGE IN THE ACTIVITIE S AND 22 NATURE OF THE WORK OF THE ASSESSEE FOR THE YEAR UND ER CONSIDERATION VIS-A-VIS THE PRECEDING YEAR I.E. 200 4-05. SIMILAR VIEW HAS ALSO BEEN TAKEN BY THE ITAT, LUCKN OW B BENCH IN THE CASE OF TAHREEM ELECTRICALS (P) LT D VS. ACIT (2007) 112 TTJ (LUCK) 586 (SUPRA),WHEREIN IT A HS BEEN HELD AS UNDER:- IT IS AN ADMITTED FACT THAT THE ASSESSEE- COMPANY IS CLAIMING DEDUCTIONS UNDER SS. 80HH AND 80-I SINCE ASSESSMENT YEAR 1992- 93.THE DEPARTMENT HAS ALLOWED DEDUCTIONS UNDER SS. 80HH AND 80-I FOR THE ASSESSMENT YEARS 1992-93, 1993-94, 1994-95, 1995-96, 1996-97 AND 1997-98. EVEN THE ASSESSING OFFICER ALLOWED DEDUCTIONS UNDER SS.80HH AND 80-I TO THE ASSESSEE FOR THE ASSESSMENT YEAR 1998-99. THE DEDUCTIONS, IN QUESTION, ARE AVAILABLE TO AN ASSESSEE FOR 8 YEARS AND THE YEAR UNDER CONSIDERATION IS THE LAST YEAR. THE CIT(A) HAS NOT BROUGHT ANY MATERIAL ON RECORD TO SHOW THAT THERE WAS ANY CHANGE IN THE ACTIVITIES OF THE ASSESSEE AS COMPARED TO THE EARLIER YEARS. THUS, IT IS CLEAR THAT SINCE ASSESSMENT YEARS 1992-93 TO 1997-98, THE ASSESSEE HAS BEEN CONSISTENTLY GETTING DEDUCTIONS UNDER SS. 80HH AND 80-I, CIT(A) WAS NOT JUSTIFIED IN WITHDRAWING THE DEDUCTIONS IN QUESTION. 23 28. IN THE PRESENT CASE ALSO, THE ASSESSING OFFICER ALLOWED THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S 80IB OF THE ACT FOR THE ASSESSMENT YEAR 2004-05 AND THER E IS NO CHANGE IN THE FACTS FOR THE ASSESSMENT YEAR UNDE R CONSIDERATION AS WELL AS IN THE ACTIVITIES OF THE A SSESSEE AS COMPARED TO THE SAID EARLIER YEAR, THEREFORE, TH E ASSESSING OFFICER WAS NOT JUSTIFIED IN DENYING THE CLAIM OF THE ASSESSEE. IN OUR OPINION, THE LD CIT(A) HAS PASSED A JUST AND WELL REASONED ORDER WHICH REQUIRES NO INTERFERENCE ON OUR PART. IN THAT VIEW OF THE MATT ER, WE DO NOT SEE ANY MERIT IN THIS APPEAL OF THE DEPARTMENT. THE FACTS OF THE GIVEN CASE ARE IDENTICAL TO THE FA CTS OF THE ABOVE ORDER. THE ASSESSEE HAS DISCLOSED EXPENSES TOWARDS ELECTRICITY DIESEL, FUEL, ETC. AND IN THIS LINE OF BUSINESS CONSUMPTION OF POWER IS NOT THAT HIGHER AS HAS BEEN DISCUSSED IN THAT ORDER. THE AS SESSEE HAS EMPLOYED AT LEAST 10 WORKERS. THEREFORE, BOTH THE ABOVE CON DITIONS STAND FULFILLED. THEREFORE, BY RESPECTFULLY FOLLOWING THE ABOVE ORDER, WE HAVE TO CONFIRM THE IMPUGNED FINDING OF THE LD. CIT (A). HENCE WE CANNOT ALLOW THIS APPEAL OF THE REVENUE AS THE SOLE GROUND RAISED STANDS DISMISSED. 24 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 7 TH MARCH, 2013. SD/- SD/- [N.K. SAINI] [HARI OM MARATHA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 7 TH MARCH, 2013. VL/ COPY TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR ASSISTANT REGISTRAR