The Income-tax Officer, UDHAMPUR V. M/s. Kashmir Cement, UDHAMPUR

ITA 531/ASR/2011

• Counselvise Citation: 53120914 RSA 2011
• Duration Of Justice: 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2007-2008
• Appeal Filed On: 31-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIK CHAND
• Keywords: Capital receipt
• Section: 43B; 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.531(ASR)/2011 ASSESSMENT YEAR:2007-08 PAN:AAHFK3694D THE INCOME TAX OFFICER, VS. M/S. KASHMIR CEMENT, UDHAMPUR. BATTAL BALLIAN, UDHAMPUR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. AMRIK CHAND, DR RESPONDENT BY: NONE DATE OF HEARING :08/05/2012 DATE OF PRONOUNCEMENT:08/05/2012 ORDER PER BENCH: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST ORDER OF CIT(A), JAMMU, DATED 24.08.2011 FOR THE ASSESSMENT YEAR 200 7-08. 2. THE GROUNDS OF APPEALS RAISED BY THE REVENUE A RE AS UNDER:- A. REGARDING DISALLOWANCE OF DEDUCTION U/S 80IB ON ACCOUNT OF CENTRAL EXCISE DUTY REFUND: 1 ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN ALLOWING RELIEF ON ACCOUNT OF DEDUCTION U/ S 80IB ON CENTRAL EXCISE DUTY REFUND BY RELYING UPON ORDERS OF HON'BL E HIGH COURT IF J&K, JAMMU WHICH HAS BEEN DELIVERED NOT ON MERITS O F THE ISSUE BUT HOLDING THE RECEIPT TO BE A CAPITAL RECEIPT ONLY BE CAUSE THE POLICY UNDER WHICH THE SAME WAS PAID ENVISAGED TACKLING TH E UNEMPLOYMENT IN THE STATE WHICH CANNOT BE SAID TO BE A GOOD TEST FOR DECIDING WHETHER A RECEIPT IS A TRADING RECEIPT OR A CAPITAL RECEIPT. 2 2. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT APPRECIATING THE JUDGMENTS OF HON'BLE SUPREME COURT OF INDIA IN THE CASE OF PONNI SUGAR & SAWHNEY STEEL AND PRESS WORKS LTD, WHEREIN THE HON'BLE SUPREME COURT HAD HELD SUCH RECEIPTS TO BE THE REVE NUE RECEIPTS IN AS MUCH AS IN THAT CASE PAYMENTS WERE MADE ONLY AFTER THE INDUSTRIES HAD BEEN SET UP AND PAYMENTS WERE NOT MADE FOR PURPOSE OF SETTING UP OF INDUSTRIES. 3. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT CONSIDERING THE DECISION IN THE CASE OF SEAHAM HARBOUR DOCK COMPANY WHICH LAYS DOWN TWO IMPORTANT TESTS FOR DETERMINING WHETHER RE CEIPTS IS A TRADING RECEIPT OR A CAPITAL RECEIPT. 4. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. C IT(A) WAS RIGHT IN FACTS AND CIRCUMSTANCES AND IN LAW IN NOT APPRECIATING AND APPLIED THE PURPOSE TEST AS LAID DOWN BY THE JUDGME NTS OF THE HON'BLE SUPREME COURT. IN THE CASE OF ASSESSEE, THE MONEY RECEIVED BY THE ASSESSEE ON ACCOUNT OF REFUND OF CENTRAL EXCISE WAS NOT SUPPOSED TO BE SPENT IN A PARTICULAR MANNER FOR PURPOSE OF SUBS TANTIAL EXPANSION OF THE INDUSTRY. B. REGARDING DISALLOWANCE OF DEDUCTION U/S 40(A)( IA) ON ACCOUNT OF TDS DEFAULT. 1. ON THE FACTS AND CIRCUMSTANCES WHETHER THE LD. CIT( A) WAS RIGHT IN DELETING THE ADDITION OF RS.1,25,10,856/- RS.1,49,400/- & RS.8,07,278/- ON ACCOUNT OF FREIGHT , SALARY TO SEC URITY GUARDS AND REPAIR & MAINTENANCE, MADE IN RESPECT OF DISALLOWA NCE OF DEDUCTION CLAIMED U/S 40(A)(IA) BY RELYING ON THE DECISION OF HONBLE ITAT, AMRITSAR IN THE CASE OF M/S. SUN PHARMACEUTICAL IND USTRIES IN ITA NO.184(ASR)/2009 AND NOT APPRECIATE THE DECISION OF SAME BENCH IN THE CASE OF KASHMIR TUBES REPORTED IN ITA NO.145(AS R)/2005 DATED 07.12.2007 WHERE SUCH DISALLOWANCES WERE UPHELD BY THE HONBLE ITAT, AMRITSAR 3. BRIEFLY STATED, THE GROUNDS NO. 1 TO 4 ( IN PART A) REVOLVE AROUND THE ISSUE OF EXCISE DUTY REFUND WHICH WAS CLAIMED AS EX EMPT IN VIEW OF SECTION 80IB OF THE INCOME-TAX ACT, 1961 (IN SHORT THE ACT ) BEING ALLOWABLE TO THE ASSESSEE. THE AO HAS NOT ALLOWED THE CLAIM OF THE ASSESSEE AND HELD THAT THE 3 RECEIPTS ON ACCOUNT OF EXCISE DUTY REFUND GRANTED I N VIEW OF GOVERNMENT NOTIFICATION WAS NOT ELIGIBLE TO BE CONSIDERED FOR THE PURPOSE OF DEDUCTION U/S 80IB OF THE ACT. 4. ON APPEAL, THE LD. CIT(A) FOLLOWING THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHREE BALA JI ALLOWS V. CIT AND ANOTHER (2011) 333 ITR 335 (J&K) HELD THAT THE EXCI SE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT AND NOT LIABLE TO BE T AXED. NOW THE REVENUE IS IN APPEAL BEFORE THIS TRIBUNAL AGAINST THE ORDER OF TH E LD. CIT(A). 5. THE LD. DR, RELIED UPON THE ORDER OF THE ASSES SING OFFICER. 6. AFTER HEARING THE LD. DR AND PERUSING THE MATERI AL AVAILABLE ON RECORD, WE FIND THAT THE ISSUE IN DISPUTE IS SQUARE LY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHREE BALA JI ALLOWS V. CIT AND ANOTHER (2011) 333 ITR 335 (J&K). THE ISSUES BEFOR E THE HON'BLE JURISDICTIONAL HIGH COURT FOR DETERMINATION WERE A S UNDER:- (1) WHETHER THE AMOUNT OF EXCISE REFUND AND INTERES T SUBSIDY RECEIVED BY THE APPELLANTS-ASSESSEES, IN PURSUANCE OF THE INCENTIVES ANNOUNCED AND SANCTIONED VIDE GOVERNMENT OF INDIA, MINISTRY OF COMMERCE AND INDUSTRY (DEPARTMENT OF INDUSTRIAL POL ICY AND PROMOTION)S OFFICE MEMORANDUM NO. 1(13)2000-NER D ATED JUNE 14,2002 AND CENTRAL EXCISE NOTIFICATION NOS. 56 AND 57, DATED NOVEMBER 14, 2002 AND OTHER NOTIFICATION ISSUED ON THE SUBJECT, PERTAINING TO THE INDUSTRIAL POLICY INTRODUCED IN T HE STATE OF JAMMU AND KASHMIR, IS A CAPITAL RECEIPT AND, THUS, NOT LI ABLE TO TAX UNDER THE PROVISIONS OF THE ACT, OR REVENUE RECEIPT, AS OPINE D BY THE AUTHORITIES UNDER THE ACT? 4 (2) WHETHER THE APPELLANTS-ASSESSEES ARE ENTITLED T O DEDUCTION UNDER SECTION 80IB OF THE ACT ON THE EXCISE DUTY RE FUND AND INTEREST SUBSIDY ETC., BEING THE INCOME DERIVED FROM THE IND USTRIAL UNDERTAKING, IN CASE THE EXCISE REFUND AND INTEREST SUBSIDY WERE FOUND TO BE REVENUE RECEIPT. 7. THE HON'BLE HIGH COURT OF JAMMU AND KASHMIR WHIL E DECIDING THE MATTER HAS DISCUSSED THE SALIENT FEATURES OF THE NE W INDUSTRIAL POLICY, AMENDMENTS INTRODUCED THERETO AND STATUTORY NOTIFIC ATION ETC. THE HON'BLE HIGH COURT FURTHER DISCUSSED THE DECISION OF HON'B LE SUPREME COURT IN THE CASE OF SAHNEY STEEL AND PRESS WORKS LTD (1997) 228 ITR 253 (S.C) AND OBSERVED AS UNDER:- 26 A PERUSAL OF THE OFFICE MEMORANDUM DATED JUNE 1 4, 2002 INDICATING NEW INDUSTRIAL POLICY AND OTHER CONCESSI ONS FOR THE STATE OF JAMMU AND KASHMIR, MAKES IT EXPLICIT THAT THE CONCE SSIONS WERE ISSUED TO ACHIEVE TWIN OBJECTS VIZ. (I) ACCELERATIO N OF INDUSTRIAL DEVELOPMENT IN THE STATE OF JAMMU AND KASHMIR, WHIC H HAD BEEN FOUND LAGGING BEHIND IN SUCH DEVELOPMENT, AND (II) GENERATION OF EMPLOYMENT IN THE STATE OF JAMMU & KASHMIR. 27 AMENDMENT INTRODUCED TO THE OFFICE MEMORANDUM VI DE NOTIFICATION OF NOVEMBER 28, 2003 OF THE GOVERNMENT OF INDIA, MINISTRY OF COMMERCE AND INDUSTRY (DEPARTMENT OF IN DUSTRIAL POLICY AND PROMOTION) ELOQUENTLY DEMONSTRATES THE CENTRAL GOVERENMENTS INTENTION IN EXTENDING THE INCENTIVES. THE GOVERNM ENTS OBJECTIVE, AS CONVEYED BY THE HONBLE PRIME MINISTER A SRINAGAR O N APRIL 19, 2003, WAS, FOR CREATION OF ONE LAKH EMPLOYMENT AND SELF-EMPLOYMENT OPPORTUNITIES IN JAMMU AND KASHMIR STATE. 28 TO ACHIEVE THE PURPOSE AND OBJECTIVE REFERRED TO HEREINABOVE, IT WAS, INTER ALIA, PROVIDED IN THE CENTRAL EXCISE NOT IFICATIONS THAT THE EXEMPTIONS CONTAINED IN THE NOTIFICATIONS WOULD BE AVAILABLE ONLY ON PRODUCTION OF CERTIFICATE FROM GENERAL MANAGER OF T HE CONCERNED DISTRICT INDUSTRIES CENTRE TO THE JURISDICTIONAL DE PUTY COMMISSIONER OF CENTRAL EXCISE OR THE ASSISTANT COMMISSIONER OF CENTRAL EXCISE, AS 5 THE CASE MAY BE, TO THE EFFECT THAT THE UNIT HAD CR EATED REQUIRED ADDITIONAL REGULAR EMPLOYMENT, WHICH WOULD NOT, HOW EVER, INCLUDE EMPLOYMENT PROVIDED BY THE INDUSTRIAL UNITS TO DAIL Y WAGERS OR CASUAL EMPLOYEES ENGAGED IN THE UNITS. 29 A CLOSE READING OF THE OFFICE MEMORANDUM AND THE AMENDMENT INTRODUCED THERETO WITH PARAGRAPH NO. 3 APPEARING I N THE CENTRAL EXCISE NOTIFICATION NOS. 56 AND 57 OF NOVEMBER 11, 2002, THUS, MAKES IT AMPLY CLEAR THAT THE ACCELERATION OF DEVEL OPMENT OF INDUSTRIES IN THE STATE WAS CONTEMPLATED WITH THE OBJECT OF GENERATION OF EMPLOYMENT IN THE STATE OF JAMMU AND KASHMIR AND THE GENERATION OF EMPLOYMENT, SO, CONTEMPLATED, WAS NOT ONLY CASUA L OR TEMPORARY; BUT WAS ON THE OTHER HAND, OF PERMANENT NATURE. 30 CONSIDERED THUS, THE PARAMOUNT CONSIDERATION OF THE CENTRAL GOVERNMENT IN PROVIDING THE INCENTIVES TO THE NEW I NDUSTRIAL UNITS AND SUBSTANTIAL EXPANSION OF THE EXISTING UNITS, WAS TH E GENERATION OF EMPLOYMENT THROUGH ACCELERATION OF INDUSTRIAL DEVEL OPMENT, TO DEAL WITH THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STAT E, ADDITIONALLY CREATING OPPORTUNITIES FOR SELF-EMPLOYMENT, HENCE A PURPOSE IN PUBLIC INTEREST. 31 IN THIS VIEW OF THE MATTER, THE INCENTIVES PROVI DED TO THE INDUSTRIAL UNITS, IN TERMS OF THE NEW INDUSTRIAL PO LICY, FOR ACCELERATED INDUSTRIAL DEVELOPMENT IN THE STATE, FOR CREATION O F SUCH INDUSTRIAL ATMOSPHERE AND ENVIRONMENT, WHICH WOULD PROVIDE ADD ITIONAL PERMANENT SOURCE OF EMPLOYMENT TO THE UNEMPLOYED IN HE STATE OF JAMMU AND KASHMIR, WERE IN FACT, IN THE NATURE OF C REATION OF NEW ASSETS OF INDUSTRIAL ATMOSPHERE AND ENVIRONMENT, H AVING THE POTENTIAL OF EMPLOYMENT GENERATION TO ACHIEVE A SOCIAL OBJECT . SUCH INCENTIVES, DESIGNED TO ACHIEVE PUBLIC PURPOSE, CANNOT, BY ANY STRETCH OF REASONING, BE CONSTRUED AS PRODUCTION OR OPERATIONA L INCENTIVES FOR THE BENEFIT OF ASSESSES ALONE. 32 THUS, LOOKING TO THE PURPOSE, OF ERADICATION OF THE SOCIAL PROBLEM OF UNEMPLOYMENT IN THE STATE BY ACCELERATIO N OF THE INDUSTRIAL DEVELOPMENT AND REMOVING BACKWARDNESS OF THE AREA THAT LAGGED BEHIND IN INDUSTRIAL DEVELOPMENT, WHICH IS C ERTAINLY A PURPOSE IN THE PUBLIC INTEREST, THE INCENTIVES PROVIDED BY THE OFFICE MEMORANDUM AND STATUTORY NOTIFICATIONS ISSUED IN TH IS BEHALF, TO THE APPELLANTS-ASSESSEES, CANNOT BE CONSTRUED AS MERE P RODUCTION AND TRADE INCENTIVES, AS HELD BY THE TRIBUNAL. 6 33. MAKING OF ADDITIONAL PROVISION IN THE SCHEME TH AT INCENTIVES WOULD BECOME AVAILABLE TO THE INDUSTRIAL UNITS, ENT ITLED THERETO, FROM THE DATE OF COMMENCEMENT OF THE COMMERCIAL PRODUCTI ON, AND THAT THESE WERE NOT REQUIRED FOR CREATION OF NEW ASSETS CANNOT BE VIEWED IN ISOLATION, TO TREAT THE INCENTIVES AS PRODUCTION IN CENTIVES, AS HELD BY THE TRIBUNAL, FOR THE MEASURE SO TAKEN, APPEARS TO HAVE BEEN INTENDED TO ENSURE THAT THE INCENTIVES WERE MADE AVAILABLE O NLY TO THE BONA FIDE INDUSTRIAL UNITS SO THAT LARGER PUBLIC INTEREST OF DEALING WITH UNEMPLOYMENT IN THE STATE, AS INTENDED, IN TERMS OF THE OFFICE MEMORANDUM, WAS ACHIEVED. 34. THE OTHER FACTORS, WHICH HAD WEIGHED WITH THE T RIBUNAL IN DETERMINE THE INCENTIVES AS PRODUCTION INCENTIVES M AY NOT BE DECISIVE TO DETERMINING THE CHARACTER OF THE INCENTIVE SUBSI DIES, WHEN IT IS FOUND, AS DEMONSTRATED IN THE OFFICE MEMORANDUM, AM ENDMENT INTRODUCED THERETO AND THE STATUTORY NOTIFICATION T OO THAT THE INCENTIVES WERE PROVIDED WITH THE OBJECT OF CREATING AVENUES F OR PERPETUAL EMPLOYMENT, TO ERADICATE THE SOCIAL PROBLEM OF UNEM PLOYMENT IN THE STATE BY ACCELERATED INDUSTRIAL DEVELOPMENT. 8. THE HON'BLE JURISDICTIONAL HIGH COURT CONCLUDED AS UNDER:- 35 FOR ALL WHAT HAS BEEN SAID ABOVE, THE FINDING O F THE TRIBUNAL ON THE FIRST ISSUE THAT THE EXCISE DUTY REFUND, INTERE ST SUBSIDY AND INSURANCE SUBSIDY WERE PRODUCTION INCENTIVES, HENCE REVENUE RECEIPT, CANNOT BE SUSTAINED, BEING AGAINST THE LAW LAID DOW N BY THE HON'BLE SUPREME COURT OF INDIA IN SAHNEY STEEL CASE (1997) 228 ITR 253 AND PONNI SUGARS CASE (2008) 306 ITR 392. 36 THE FINDING OF THE TRIBUNAL THAT THE INCENTIVES WERE REVENUE RECEIPT IS, ACCORDINGLY, SET ASIDE HOLDING THE INCE NTIVES TO THE CAPITAL RECEIPT IN THE HANDS OF THE ASSESSES. 37 IN VIEW OF OUR ABOVE FINDING ON THE FIRST ISSUE, THERE IS NO NEED TO OPINE ON THE SECOND ISSUE, WHICH WAS RAISED IN T HE ALTERNATIVE. 9. RESPECTFULLY FOLLOWING THE JUDGMENT OF THE HON'B LE JURISDICTIONAL HIGH COURT(SUPRA), WE CONFIRM THE ORDER OF THE LD. CIT(A) IN HOLDING THAT 7 THE EXCISE DUTY REFUND IS TO BE TREATED AS CAPITAL RECEIPT IN THE HANDS OF THE ASSESSEE AND NOT LIABLE TO BE TAXED. 10. IN GROUND NO.1 (PART-B) THE REVENUE HAS RAISED THE ISSUE REGARDING DISALLOWANCE OF DEDUCTION U/S 40(A)(IA) ON ACCOUNT OF TDS DEFAULT. THE BRIEF FACTS OF THE CASE ARE THAT IN THE COURSE OF SCRUTIN Y, IT WAS FOUND BY THE AO THAT THE ASSESSEE HAS MADE PAYMENTS OF RS.1,25,10,8 56/-, RS.1,49,400/- & RS.8,07,278/- ON ACCOUNT OF FREIGHT , SALARY TO SEC URITY GUARDS AND REPAIR & MAINTENANCE AND OBSERVED THAT THE ASSESSEE WAS LI ABLE TO DEDUCTION OF TAX AT SOURCE ON THESE PAYMENTS. THE AO, THEREFORE, HEL D THAT THE PROVISIONS OF SECTION 40(A)(IA) OF THE ACT ARE CLEARLY ATTRACTED TO THESE PAYMENTS AND ACCORDINGLY MADE THE ADDITIONS. ON APPEAL, THE LD. CIT(A) DELETED THE ADDITIONS MADE BY THE AO VIDE PARA 7 OF HIS ORDER, OBSERVING AS UNDER: 7. I HAVE CAREFULLY CONSIDERED THE CONTENTION MADE AND FIND THAT THE ASSESSEE IS TO SUCCEED IN SECOND ALTERNATIVE AR GUMENT THAT EVEN IF THE DISALLOWANCE WAS TO BE MADE YET IT QUALIFIED FO R DEDUCTION U/S 80IB OF THE ACT. APART FROM THE DECISION CITED IN T HE WRITTEN SUBMISSIONS U/S THE ASSESSEE, IN SUPPORT OF I.T.ACT , THERE IS A DECISION OF THE JURISDICTIONAL BENCH OF HONBLE ITAT, AMRITS AR ON DEPUTATION U/S 80IB OF THE ACT ON SUCH DISALLOWANCE IN CASE OF M/S. SUN PHARMACEUTICALS IN ITA NO.184(ASR)/2009 FOR THE ASS ESSMENT YEAR 2005-06 PASSED ON 11.06.2010 WHICH DEALS WITH THE I SSUE AS UNDER: AS REGARDS TO THE ADDITIONAL GROUND NOS.1, 2 AND 3 CLAIMING CONSEQUENTIAL THE HIGHER DEDUCTION UNDER SECTION 80 IB ON ACCOUNT OF DISALLOWANCE OF REMUNERATION UNDER SECTI ON 40(B) AMOUNTING TO RS.33,20,15,856/-, DISALLOWANCE UNDER SECTION 43B AMOUNTING TO RS.18,46,427/- AND DISALLOWANCE UN DER SECTION 40(A)(IA) AMOUNTING TO RS.4,80,301/- FOR CO NTRIBUTION OF DEDUCTION UNDER SECTION 80IB. THE LEARNED D.R. REL IED UPON THE ORDERS OF THE LOWER AUTHORITIES. 8 WE HAVE CONSIDERED THE ARGUMENTS OF BOTH THE PARTIE S AND CAREFULLY EXAMINED THE RECORDS. WE FIND THAT SECTI ON 80AB STATES IN CLEAR TERMS AS UNDER:- SECTION 80AB. WHERE ANY DEDUCTION IS REQUIRED TO BE MADE OR ALLOW ED UNDER ANY SECTION INCLUDED IN THIS CHAPTER UNDER THE HEAD ING C.- DEDUCTIONS IN RESPECT OF CERTAIN INCOMES IN RESPEC T OF ANY INCOME OF THE NATURE SPECIFIED IN THAT SECTION WHIC H IS INCLUDED IN THE GROSS TOTAL INCOME OF THE ASSESSEE, THEN, NO TWITHSTANDING ANYTHING CONTAINED IN THAT SECTION, FOR THE PURPOSE OF COMPUTING THE DEDUCTION UNDER THAT SECTION , THE AMOUNT OF INCOME OF THAT NATURE AS COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THIS ACT (BEFORE MAKING ANY DEDUCTION UNDER THIS CHAPTER) SHALL ALONE BE DEEMED TO BE THE AMOUNT OF INCOME OF THAT NATURE WHICH IS DERIVED OR RECEIVED BY THE ASS ESSEE AND WHICH IS INCLUDED IN HIS GROSS TOTAL INCOME. UNDER THE CIRCUMSTANCES TO THE EXTENT DISALLOWANCE AND/OR THE ADDITIONS ARE MADE, WHICH ARE SUBJECT MATTER OF ADD ITIONAL GROUND, ORIGINAL PROFIT TO THE APPELLANT WOULD STAN D ENHANCED OR EVEN ON THIS PROFIT WOULD GET DEDUCTION UNDER SE CTION 80IB. ACCORDINGLY, THE ADDITIONS AMOUNTS (RS.32,20,15,856 /-, RS.18,46,427/- AND RS.4,80,301/-) ARE INCLUDED IN T HE GROSS TOTAL INCOME, CONSEQUENTLY DEDUCTION UNDER SECTION 80IB IS ALLOWABLE ON SUCH HIGHER AMOUNT. HENCE, THESE ADDI TIONAL GROUNDS OF APPEALS ARE ALLOWED SUBJECT TO THE PROVI SIONS OF SECTION 70A(2) READ WITH SECTION 80AB AND 80B(5) OF THE I.T. ACT. 7(A) RESPECTFULLY FOLLOWING THE DECISION OF HONBLE ITAT, AMRITSAR, IT IS HELD THAT DEDUCTION U/S 80IB OF THE ACT IS AL LOWABLE ON THE AMOUNT OF ENHANCEMENT OF INCOME IN VIEW OF THE DISA LLOWANCE MADE U/S 40(A)(IA) OF THE ACT. 11. WE HAVE HEARD THE LEARNED DR AND PERUSED THE FA CTS OF THE CASE, INCLUDING THE ORDER PASSED BY THE LD. CIT(A) ON THE ISSUE IN DISPUTE. WE FIND THAT THE LEARNED CIT(A) HAS GIVEN HIS FINDINGS BASED ON FACTS, LOGIC AND CORROBORATIVE EVIDENCE, AS REPRODUCE ABOVE, WHICH REQUIRES NO INTERFERENCE 9 ON OUR PART. ACCORDINGLY, WE UPHOLD THE FINDINGS OF THE LEARNED CIT(A) ON THE ISSUE IN DISPUTE AND DISMISS THE GROUND OF APPE AL RAISED BY THE REVENUE IN PART-B OF THE GROUNDS. 12. IN THE RESULT, THE APPEAL OF THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 8TH MAY, 2012. SD/- SD/- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 8TH MAY, 2012 /SKR/ COPY OF THE ORDER IS FORWARDED TO : 1. THE ASSESSEE:M/S. KASHMIR CEMENT, BATTAL BALLIAN, U DHAMPUR. 2. THE ITO, UDHAMPUR. 3. THE CIT(A), JAMMU. 4. THE CIT, JAMMU. 5. THE SR DR, ITAT, AMRITSAR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH : AMRITSAR.