Linc Pen & Plastics Ltd., Kolkata V. D.C.I..T CC - VII,kolkata., Kolkata

ITA 43/KOL/2013

• Counselvise Citation: 4323514 RSA 2013
• Duration Of Justice: 2 year(s) 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 07-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KALYAN NATH
• Assessee Lawyers: S L KOCHAR
• Keywords: Business income; Depreciation; Share purchase agreement; Opportunity of being heard
• Section: 143(3); 10AA; 80IB; 6; 263

Judgement Text

I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 1 OF 10 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA B BENCH, KOLKATA BEFORE SHRI S.V. MEHROTRA , ACCOUNTANT MEMBER AND SHRI MAHAVIR SINGH , JUDICIAL MEMBER I.T.A. NO S . 43 & 44 / KOL / 20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 LINC PEN & PLASTICS LIMITED,.. ... ........ .... ........ . .......... APPELLANT 3, ALIPORE ROAD, KOLKATA - 700 027 [PAN : AAACL 6426 C] - VS. - DEPUTY COMMISSIONER OF INCOME TAX,............................. . RESPONDE NT CENTRAL CIRCLE - VII, KOLKATA, AAYAKAR BHAWAN (POORVA), 110, SHANTI PA LLY, KOLKATA - 700 107 & I.T.A. NO. 2409/KOL / 20 13 ASSESSMENT YEAR : 2009 - 2010 DEPUTY COMMISSIONER OF INCOME TAX,............................. . APPELLANT CENTRAL CIRCLE - 11 , KOLKATA, AAYAKAR BHAWAN (POORVA), 110, SHANTI PALLY, KOLKATA - 700 107 - VS. - LINC PEN & PLASTICS LIMITED,......................... ........... RESPONDENT 3, ALIPORE ROAD, KOLKATA - 700 027 [PAN : AAACL 6426 C] APPEARANCES BY: SHRI S.L. KOCHAR, ADVOCATE & SHRI ANIL KOCHAR, ADVOCATE, FOR THE ASSESSEE SHRI KALYAN NATH , JCIT, SR. D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : AUGUST 12 , 2 01 5 DATE OF PRONOUNCING THE ORDER : AUGUST 13 , 201 5 O R D E R PER S.V. MEHROTRA : WE FIRST TAKE UP THE ITA NO. 43/KOL/2013 . THIS A PPEAL HA S BEEN FILED BY THE ASSESSE E AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 2 OF 10 (APPEALS) , CENTRAL - I, KOLKATA D ATED 0 2 . 11 .20 1 2 FOR THE ASSESSMENT YEAR 200 6 - 0 7 . 2. BRIEF FACTS OF THE CASE ARE THAT IN THE ORIGINAL ASSESSMENT, THE ASSESSING OFFICER ALLOWED THE DEDUCTION OF ENTIRE AMOUNT CLAIM ED BY THE ASSESSEE. HOWEVER, IN PURSUANCE TO HIS ORDER PASSED ON 17.10.2011 UNDER SECTION 263 READ WITH SECTION 143(3) HE WITHDREW THE CLAIM UNDER SECTION 80IB AMOUNTING TO RS.69,86,940/ - AFTER DETERMINING THE ELIGIBLE CLAIM AT RS.1,73,39,563/ - . THIS WITHD RAWN WAS MADE IN VIEW OF THE DECISION OF THE HON BLE SUPREME COURT IN THE CASE OF LIBERTY INDIA VS. - CIT REPORTED IN 317 ITR 218. BEFORE WE PROCEED FURTHER WE MAY OBSERVE THAT THE ASSESSING OFFICER HAD WITHDRAWN THE ENTIRE AMOUNT OF RS.2,43,26,503/ - AFTER OBSERVING THAT THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 80IB FOR THREE BRANCHES WHICH WERE CREATED AT LATER DATES SINCE THE ORIGINAL BUSINESS STARTED AND FUNDS AND ASSETS WERE DISTRIBUTED AND ACCOUNTED FOR BY THE HEAD OFFICE WHICH PREPARED THE CONSOLI DATED ACCOUNTS AND ACTED AS THE SOLE ASSESSEE AND NONE OF UNITS WAS AN ASSESSEE, AND AS SUCH THE DEDUCTION UNDER SECTION 80IB WAS NOT ALLOWABLE. HOWEVER, THE LD. CIT(APPEALS) HAS DECIDED THE ISSUE REGARDING ELIGIBILITY FOR DEDUCTION UNDER SECTION 80IB IN R ESPECT OF ASSESSEE S THREE UNITS IN FAVOUR OF ASSESSEE AND, THEREFORE, AS FAR AS ELIGIBILITY OF ASSESEE FOR DEDUCTION UNDER SECTION 80IB IS CONCERNED, THE SAID ISSUE IS NOT BEFORE US. THE ONLY ISSUE BEFORE US IS REGARDING THE DISALLOWANCES MADE WHILE COMPU TING THE DEDUCTION UNDER SECTION 80IB OF THE ACT. 3. LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET, REFERRED TO PARA 9 OF LD. CIT(APPEALS) ORDER AND POINTED OUT THAT THE LD. CIT(APPEALS) HAS EXCLUDED FROM THE PROFITS ELIGIBLE FOR DEDUCTION UNDER SECTION 80 IB , ON THE FOLLOWING TWO ITEMS : - (A) REBATE ON CENTRAL SALES TAX PAYABLE AT RS.17,05,208.76 AS PER SCHEDULE 10 OF PILERNE UNIT; I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 3 OF 10 (B) COMMISSION ON HIGH SEA SALES PAYABLE AT RS.64,052/ - AS PER SCHEDULE 11 OF OTHER OPERATIONAL INCOME . LD. COUNSEL FOR THE A SSESSEE POINTED OUT THAT FOR THESE TWO ITEMS, THERE IS NO DISCUSSION EITHER IN THE ASSESSMENT ORDER OR IN THE ORDER OF LD. CIT(APPEALS) . HE HAS FILED A NOTE BEFORE US IN REGARD TO REBATE ON CENTRAL SALES TAX PAYABLE WHICH IS REPRODUCED HEREUNDER: - 8. THE APPELLANT SUBMITS RELEVANT SCHEDULE OF PILERNE UNIT AS APPEARING IN THE AUDITED ACCOUNTS. COMMISSION ON HIGH SEA SALE IS IN RESPECT OF THE TRANSACTIONS RELATING TO EXPORT. FURTHER, ASSESESE S INDUSTRIAL UNDERTAKING AT PILERNE IS UNDER THE JURISDICTION OF G OA SALES TAX AUTHORITIES AND REBATE WAS RECEIVED. BACK GROUND : EARNER NEW SSI MANUFACTURING UNITS WERE EXEMPTED FROM SALES TAX IN GOA UNDER ENETRY 68 UNDER GOA SALES TAX ACT, 1964, BUT DURING THE IMPLEMENTATION OF NATIONWIDE VAT SYSTEM, EXEMPTIONS WERE WI THDRAWN AND A NEW SCHEME CALLED NPV WAS DESIGNED FOR THE EXEMPTED UNITS FOR THE BALANCE PERIOD OF EXEMPTION. UNDER THE NPV SCHEME THE ASSESSEE WAS ALLOWED TO CHARGE FULL RATE OF TAX AND GET 75% REBATE FROM PAYMENT OF TAX . AS REGARDS COMMISSION ON HIGH S EAS SALE, LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT IMPORTS MADE BY THE ASSESSEE WERE SOLD ON HIGH SEA ON WHICH COMMISSION WAS EARNED. HOWEVER, THIS ASPECT HAS NOT BEEN CONSIDERED BY THE LOWER AUTHORITIES WHILE APPLYING THE DECISION OF THE HON BLE SUPR EME COURT IN THE CASE OF LIBERTY INDIA (SUPRA). 4. LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE RELIED ON THE ORDER OF LD. CIT(APPEALS). 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THROUGH THE ORDERS OF TAX AUTHORITIES BELOW ALONG WITH THE MATERIA L AVAILABLE ON RECORD. BY CONSIDERING THE TOTALITY OF THE FACTS, WE RESTORE BOTH THE ISSUES TO THE FILE OF ASSESSING OFFICER FOR CONSIDERING IT AFRESH REGARDING ELIGI BILITY OF THESE TWO ITEMS, DEDUCTION UNDER SECTION 80IB IN ACCORDANCE WITH LAW IN THE I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 4 OF 10 LIGH T OF DECISION OF THE HON BLE SUPREME COURT IN THE CASE OF LIBERTY INDIA VS. - CIT REPORTED IN 317 ITR 218. 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSE E IS ALLOWED FOR STATISTICAL PURPOSES . 7. NOW WE TAKE UP THE ITA 44/KOL/2013 . THIS APPEAL HAS BEE N FILED BY THE ASSESSEE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS), CENTRAL - I, KOLKATA DATED 02.11.2012 FOR THE ASSESSMENT YEAR 2009 - 10. 8. BRIEF FACTS OF THE CASE ARE THAT THE ASSESESE FILED ITS RETURN OF INCOME SHOWING TOTAL INCOME OF RS.3,63,23,363/ - . THE ASSESSMENT WAS COMPLETED AT A TOTAL INCOME OF RS.6,19,89,391/ - AFTER MAKING THE FOLLOWING ADDITIONS/ DISALLOWANCES: - DISALLOWANCE OF LOSS CLAIMED FROM SEZ UNIT......RS.10,40,736/ - SHORT TERM CAPITAL GAIN............................ ............RS.1,19,66,299/ - THE LD. CIT(APPEALS) CONFIRMED BOTH THE ADDITIONS. BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL ON THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL: - ( 1 ) FOR THAT THE LD. CIT(A) OUGHT TO HAVE ALLOWED DEDUCTIONS U/S. 80I B AS CLAIMED BY THE APPELLANT. ( 2 ) FOR THAT THE CLAIM FOR DEDUCTION U/S 80IB INCLUDED ITEMS OF INCOME NOTED UNDER THE HEAD OTHER INCOME AND THAT THE SAME FORMED PART OF THE INCOME DERIVED BY THE APPELLANT ELIGIBLE FOR DEDUCTION U/S. 80IB. ( 3 ) FOR THAT THE LD. CI T(A) ERRED IN CONFIRMING DISALLOWANCE OF RS.10,40,736/ - BEING LOSS SUFFERED BY THE APPELLANT IN ITS SEZ UNIT WHICH WAS CLAIMED BY THE APPELLANT ADJUSTABLE AGAINST BUSINESS INCOME. ( 4 ) FOR THAT THE LD. CIT(A) ERRED IN CONFIRMING ACTION OF THE AO IN WORKING OUT S.T. CAPITAL GAINS AT RS.1,19,66,299/ - AS AGAINST RS. NIL AS CLAIMED BY THE APPELLANT. I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 5 OF 10 9. GROUNDS NO. 1 & 2 HAVE NOT BEEN PRESSED BY THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING. THEREFORE, GROUNDS NO. 1 & 2 ARE BEING DISMISSED AS NOT PRESSED. 10. BRIEF FACTS APROPOS GROUND NO. 3 ARE THAT THE ASSESSEE HAD A UNIT IN FALTA - SEZ. IT HAD CLAIMED DEDUCTION UNDER SECTION 10AA. THE ASSESSING OFFICER NOTICED THAT ASSESSEE SUFFERED A LOSS OF RS.10,40,736/ - IN ITS LINK PEN & PLASTICS LIMITED - FALTA UNIT I N RESPECT OF WHICH HE CLAIMED ELIGIBILITY FOR EXEMPTION UNDER SECTION 10AA WHICH WAS INCLUDED IN THE CONSOLIDATE PROFIT. HE POINTED OUT THAT BEFORE FILING OF RETURN, THE ASSESSEE HAD NOT FILED ANY DECLARATION IN WRITING THAT TH E PROVISIONS OF THIS SECTION MAY NOT BE MADE APPLICABLE TO IT AS I S PROVIDED IN SUB - SECTION (8) OF SECTION 10. HE , ACCORDINGLY , DISALLOWED THE LOSS AND ADDED BACK TO THE TOTAL INCOME OF THE ASSESSEE. 11. LD. CIT(APPEALS) CONFIRMED THE ADDITION. LD. COUNSEL FOR THE ASSESSEE POINTED OU T THAT THE EXEMPTION HAS BEEN CLAIMED UNDER SECTION 10AA AND THERE I S NO MENTION FOR FURNISHING PARTICULARS IN THE SAID SECTION AS MENTIONED BY THE ASSESSING OFFICER IN HIS ORDER. HE POINTED OUT THAT THERE I S NO CORRESPONDING PROVISION TO SECTION 10A(8) IN SECTION 10AA OF THE I.T. ACT . 12. LD. SR. D.R. SUBMITTED THAT SINCE THE FACTS A R E NOT CLEAR ONLY THE ASSESSING OFFICER IS IN A POSITION TO POINT OUT UNDER WHICH SECTION HE WANTS TO TAKE ACTION . T HEREFORE, THE MATTER MAY BE RESTORED TO THE FILE OF ASSESSI NG OFFICER FOR FRESH ADJUDICATION. 13. HAVING HEARD THE RIVAL SUBMISSIONS AND AFTER PERUSING THE MATERIAL AVAILABLE ON RECORD, WE FIND THAT THE ASSESSING OFFICER AS WELL AS THE LD. CIT(APPEALS) HAVE NOT PROPERLY APPRECIATED UNDER WHICH PROVISION THE ASSES SEE WAS REQUIRED TO FURNISH THE DETAILS. THE ASSESSING OFFICER HAS I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 6 OF 10 HIMSELF OBSERVED THAT THE DEDUCTION WAS CLAIMED UNDER SECTION 10AA, BUT HE REFERRED TO THE DETAILS AS WERE REQUIRED TO BE FURNISH ED AS PER SECTION 10AA(8). UNDER SUCH CIRCUMSTANCES AND FOR PROPER APPRECIATION OF FACT S AND LAW , WE RESTORE THE MATTER BACK TO THE FILE OF ASSESSING O FFICER FOR FRESH ADJUDICATION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 14. BRIEF FACTS APROPOS GROUND NO. 4 ARE THAT DURING THE YEAR, M/S. SHREE WRITING AIDS PVT. LTD., A COMPANY WHICH WAS SUBSEQUENTLY AMALGAMATED WITH THE ASSESSEE - COMPANY HAD DISPOSED OFF THE OFFICE AT MUMBAI BEING UNIT NO. F, PHASE NO. 32 ON THE GROUND FLOOR IN THE SHREE LAXMI UNIT, VIJAY INDUSTRIAL PREMISES COOPERATIV E SOCIETY LIMITED, PHASE NOS. 30, 32, 34 & 35, LAXMI INDUSTRIAL ESTATE, NEW LINK ROAD, AHDHERI (WEST), MUMBAI ALONGWITH FIVE SHARES BEARING DISTINCTIVE NOS. 621 & 625 UNDER SHARE CERTIFICATE NO. 90 TO MRS. SAROJ B. SINGHALA FOR A TOTAL CONSIDERATION OF RS. 1,21,00,000/ - . THE ASSESSING OFFICER NOTICED THAT ON PERUSAL OF THE DEPRECIATION SCHEDULE OF THE INCOME TAX ACT AND DETAILS OF SALE OF FIXED ASSETS AS PER CLAUSE NO. 14(D), ANNEXURE - C, IT WAS FOUND THAT THE ASSESSEE DEDUCTED ONLY RS.6,34,845/ - INSTEAD OF R S.1,21,00,000/ - THE SALE CONSIDERATION RECEIVED ON SALE OF OFFICE AT MUMBAI WHICH WAS ONLY ASSET HAVING WRITTEN DOWN VALUE AT THE BEGINNING OF THE YEAR RS.1,33,701/ - IN THE BLOCK OF ASSETS BEING BUILDING USED FOR OTHER THAN RESIDENTIAL PURPOSES IN THE DEPR ECIATION SCHEDULE AS PER INCOME TAX ACT IN THE ACCOUNTS OF M/S. SHREE WRITING AIDS PVT. LTD., THE AMALGAMATING COMPANY. 15. THE PLEA OF ASSESSEE WAS THAT SINCE THE FLAT WAS FULLY FURNISHED BY WAY OF FURNITURE & FIXTURES, ELECTRIC INSTALLATION, AIR CONDITI ONERS, OFFICE EQUIPMENT WHAT THE ASSESSEE - COMPANY DID WAS THAT THE TOTAL CONSIDERATION OF RS.1,21,00,000/ - WAS PRO - RATA DIVIDED IN PROPORTION OF THE WRITTEN DOWN VALUE AS APPEARING THE STATEMENT OF DEPRECIATION AS PER INCOME TAX ACT AND DEDUCTED THE SAME O UT OF THE WRITTEN DOWN VALUE I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 7 OF 10 BROUGHT FORWARD. THE ASSESSING OFFICER DID NOT ACCEPT THIS CONTENTION OF LD. COUNSEL OF THE ASSESSEE BY OBSERVING AS UNDER: - THEREFORE, SALE CONSIDERATION OF RS.1,21,00,000/ - RECEIVED BY THE SHREE WRITING AIDS PVT. LTD., AMALG AMATING COMPANY WITH ASSESSEE IS ONLY FOR SALE OF OFFICE AS DESCRIBED IN THE SCHEDULE AS ABOVE. THEREFORE, UNDER THE FACTS AND CIRCUMSTANCES AS DISCUSSED ABOVE, THE ASSESSEE WAS REQUIRED TO REDUCE THE ABOVE SALE CONSIDERATION IN THE BLOCK OF BUILDING OTHER THAN THE RESIDENTIAL AS PER PROVISIONS OF SEC. 43(6) READ WITH SEC. 50(1) OF THE I.T. ACT, 1961 INSTEAD OF APPORTIONING IT AMONGST BUILDING, PLANT AND MACHINERY AND FURNITURE PRO - RATA BASIS IN PROPORTION TO THEIR W.D.V. ACCORDINGLY, THE SHORT TERM CAPITAL GAIN ARISING FROM THE SALE OF SAID OFFICE AT MUMBAI AND ALLOWABILITY OF DEPRECIATION OF OTHER ASSETS ARE BEING RECALCULATED AS FOLLOWS: - SHORT TERM CAPITAL GAIN CHARGEABLE AS PER SEC. 50(1) OF THE I.T. ACT BLOCK - BUILDING USED FOR OTHER THAN RESIDENTIA L PURPOSES (RATE 10%) FULL VALUE OF CONSIDERATION RECEIVED ON ( 1 ) SALE OF MUMBAI OFFICE. RS.1,21,00,000/ - (BEING ONLY ASSET IN THIS BLOCK OF AMALGAMATING CO. M/S. SHREE WRITING AIDS PVT. LTD. IN THE BLOCK) W.D.V. OF THE BLOCK AT THE BEGINNING OF THE YEAR - RS. 1,33,701/ - ____________________ SHORT TERM CAPITAL GAIN ON SALE OF DEPRECIATION ASSETS : RS.1,19,66,299/ - THEREFORE, THE SHORT TERM CAPITAL GAIN OF RS.1,19,66,299/ - IS ADDED BACK TO THE TOTAL INCOME. 16. LD. CIT(APPEALS) CONFIRMED T HE ACTION OF THE ASSESSING OFFICER BY OBSERVING AS UNDER: - 13. I FIND THAT THE OFFICE WHICH WAS ACQUIRED IN MARCH, 1994 WAS DISPOSED OFF ON 16.03.2009. IT HAS BEEN HELD AS A BUSINESS ASSET. THE DEED OF CONVEYANCE RECORDS THE SALE OF OFFICE SPACE ONLY AND THERE IS NO MENTION OF OTHER FIXED ASSETS. IN THIS FACTUAL BACKGROUND, I AM OF THE OPINION THAT THE AO HAS COMPUTED THE CAPITAL GAIN IN ACCORDANCE WITH THE PROVISIONS OF LAW. THE ORDER OF THE AO IS UPHELD. GROUND NO. 9 & 10 IS DISMISSED. GROUND NO. 1,2,3,1 1 & 12 IS GENERAL IN NATURE . 17. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY IN THE BOOKS OF ACCOUNT THE ASSESSEE S BLOCK OF ASSETS WAS RS.1,33,701/ - WHICH WAS LIQUIDATED BY WAY OF SALE AT A I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 8 OF 10 TOTAL CONSIDER ATION OF RS.1,21,00,000/ - . THEREFORE, THERE WAS NO JUSTIFICATION IN ALLOCATING THE SALE CONSIDERATION AGAINST VARIOUS ITEMS, I.E. FURNITURE & FIXTURES, ELECTRIC INSTALLATION, AIR CONDITIONERS, OFFICE EQUIPMENTS, ETC. THE LD. CIT(APPEALS) HAS OBSERVED THAT IN THE SALE DEED, THERE IS NO SUCH BIFURCATION, THOUGH SUCH BIFURCATION WAS MADE AT THE TIME OF AMALGAMATION. UNDER SUCH CIRCUMSTANCES, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT(APPEALS). ACCORDINGLY THIS GROUND IS DISMISSED. 18. NOW WE TAKE UP THE ITA 2409/KOL/2013 . THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS), CENTRAL - I, KOLKATA DATED 02.11.2012 FOR THE ASSESSMENT YEAR 2009 - 10. 19. THERE IS DELAY ONLY FOR TWO DAYS. LD. D.R. SUBMITTED THAT DELAY MAY KINDLY BE CONDONED AND HAS OCCURRED DUE TO ADMINISTRATIVE REASON. LD. COUNSEL FOR THE ASSESSEE DID NOT SERIOUSLY OPPOSE IT. WE ACCORDINGLY CONDONE THE DELAY AND ADMIT THE APPEAL. 20. THE ONLY ISSUE IN THE PRESENT APPEAL IS REGARDING ALLOCAT ION OF EXPENSES AMONGST VARIOUS UNITS. THE ASSESSING OFFICER HAS OBSERVED AS UNDER: - FURTHER, THOUGH THE TWO UNITS OF THE ASSESSEE SITUATED IN KOLKATA AND GOA IS ENGAGED IN THE MANUFACTURING OF THE SIMILAR RANGES OF PRODUCT, THE PROFIT MARGIN IN KOLKATA U NIT IS MUCH LESS THAN IN COMPARISON TO GOA UNIT. THIS IS MAINLY DUE TO THE FACTS THAT THE ASSESSEE HAS NOT APPORTIONED PROPORTIONATELY THE EXPENDITURE WHICH ARE ALSO ATTRIBUTABLE AND COMMON TO THE MANUFACTURING UNIT AT GOA..... . 21. THE LD. CIT(APPEALS) F OLLOWING HIS EARLIER DECISION HELD THAT THE ORDER PASSED BY THE ASSESSING OFFICER WAS NOT SUSTAINABLE. BEING AGGRIEVED, THE DEPARTMENT IS IN APPEAL BEFORE THE TRIBUNAL BY TAKING THE FOLLOWING EFFECTIVE GROUND OF APPEAL: - I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 9 OF 10 THAT ON THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(APPEALS) ERRED IN ALLOWING APPORTIONMENT EXPENSES OF RS.1,34,08,126/ - WITHOUT APPRECIATING THE FINDINGS OF THE AO PUT FORWARD IN THE ASSESSMENT ORDER . 22. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE POINTED OUT THAT TRIBUNAL HAS RE STORED THE ISSUE IN ASSESSEE S OWN CASE IN ITA NOS. 1170 & 1171/KOL/2011 FOR THE ASSESSMENT YEAR 2005 - 06 & 2008 - 09 TO THE FILE OF ASSESSING OFFICER BY OBSERVING AS UNDER: - 3. THE LEARNED DR HAD NO OBJECTION TO SUCH PRAYER INSOFAR AS THE LEARNED COUNSEL OF THE ASSESSEE HAS RELIED ON THE APPORTIONMENT FOR BOTH THE ASSESSMENT YEARS IN ACCORDANCE WITH THE PROVISIONS OF THE I. T. ACT AND IN ACCORDANCE WITH THE HISTORY OF THE ASSESSEE'S CASE WHEN THE AUDITORS HAVE CERTIFIED THE APPORTIONMENT OF HEAD OFFICE EXPEN SES TO BE CONSIDERED FOR CLAIMING DEDUCTION U/S.80IB TO BE ON THE BASIS OF THE PROVISIONS OF SECTION 80LB HAS TO BE COMPUTED IN A JUDICIOUS MANNER AND NOT AS COMPUTED BY THE ASSESSING OFFICER INSOFAR AS THE ASSESSING OFFICER HAS COMPUTED THE INCOME FROM BU SINESS AS PER THE NET PROFIT ACCOUNT OF THE HEAD OFFICE BUT HAS COMPUTED THE CLAIM OF DEDUCTION/S.80IB UNIT - WISE. IT WAS SUBMITTED THAT THE ASSESSING OFFICER'S OBSERVATION THAT THE THREE UNITS WERE CREATED AT A LATER STAGE SINCE ORIGINAL BUSINESS WAS START ED AND THAT THE JOINT ASSETS WERE DISTRIBUTED AND ACCOUNTED FOR BY THE HEAD OFFICE WERE NOT ONLY AGAINST FACT FINDING AS PER AUDITED ACCOUNTS AND CERTIFICATE FOR MATTER OF DEDUCTION CLAIMED U/S.80IB INSOFAR AS ALL THE UNITS ARE INDEPENDENT. THE LEARNED COU NSEL OF THE ASSESSEE THEREFORE PRAYED THAT THE ASSESSING OFFICER MAY BE DIRECTED TO REWORK THE DEDUCTION ALLOWABLE U/S.80IB BY CONSIDERING THE DISCOUNT IN PURCHASES ALSO FORMING PART OF INCOME FOR THE PURPOSE OF DEDUCTION U/S.80IB FOR THE ASSESSMENT YEAR 2 005 - 06 INSOFAR AS THE ASSESSEE HAS PRAYED TO WITHDRAW THE GROUND RELATING TO COMPUTING THE DEDUCTION WITHOUT INCLUDING DUTY DRAW BACK AND EXPORT BENEFITS. WITH RESPECT TO THE ASSESSMENT YEAER 2008 - 09, THE ASSESSING OFFICER IS DIRECTED TO CONSIDER THE APPOR TIONMENT OF THE HEAD OFFICE EXPENSES IN ACCORDANCE WITH THE PROVISIONS OF THE I.T. ACT TO ALLOW DEDUCTION U/S. 80IB . 23. WE HAVE HEARD THE RIVAL SUBMISSIONS AND GOING THROUGH THE ORDER OF THIS TRIBUNAL DATED 23.05.2013 IN ITA NOS. 1170 & 1171/KOL/2011 IN ASSESSEE S OWN CASE. BY RESPECTFULLY FOLLOWING THE ORDER OF THIS TRIBUNAL, WE RESTORE THIS ISSUE TO THE FILE OF ASSESSING OFFICER FOR DECIDING THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING REASONABLE OPPORTUNITY OF I.T.A. NO S . 43 & 44 / KOL ./20 1 3 ASSESSMENT YEAR S : 200 6 - 20 0 7 & 2009 - 2010 & I.T.A. NO. 2409/KOL/2013 ASSESSMENT YEAR : 2009 - 2010 PAGE 10 OF 10 BEING HEARD TO THE ASSESSEE. R ESULTANTLY, THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 24. TO SUM UP, I N THE RESULT, THE APPEAL BEING ITA NO. 43/KOL/2013 FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THE APPEAL BEING ITA NO. 44/KOL/2013 FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. THE APPEAL BEING ITA NO. 2409/KOL/2013 FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH AUGUST , 201 5 . SD/ - SD/ - MAHAVIR SINGH S.V. MEHROTRA ( JUDICIAL MEMBER) ( ACCOUNTANT MEMBER) KOLKATA, THE 13 TH D AY OF AUGUST , 201 5 COPIES TO : (1) LINC PEN & PLASTICS LIMITED, 3, ALIPORE ROAD, KOLKATA - 700 027 (2) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - VII, KOLKATA, AAYAKAR BHAWAN (POORVA), 110, SHANTI PALLY, KOLKATA - 700 107 (3) COMMISSIONER OF INCOME - TAX (APPEALS) , CENTRAL - I , KOLKATA (4) COMMISSIONER OF INCOME TAX - , KOLKATA ( 5 ) THE DEPARTMENTAL REPRESENTATIVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA B ENCHES, KOLKATA LAHA/SR. P.S .