IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 75/AHD/2014 (ASSESSMENT YEAR: 2010-11) ASSISTANT COMMISSIONER OF INCOME TAX,CIRCLE-4, BARODA V/S M/S. TRANSPEK SILOX INDUSTRY LTD. KALALI ROAD, ATLADRA,BARODA (APPELLANT) (RESPONDENT) PAN: AAACT3739J APPELLANT BY : SHRI PARDIP KUMAR MAJUMDAR, SR. D R RESPONDENT BY : WRITTEN SUBMISSION ( )/ ORDER DATE OF HEARING : 04 -04-201 7 DATE OF PRONOUNCEMENT : 06 -04-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A)- III, BARODA DATED 18.10.2013 PERTAINING TO A.Y. 201 0-11. 2. THE GRIEVANCE OF THE REVENUE READS AS UNDER:- ITA NO. 75/A HD/2014 . A.Y. 2010-11 2 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN HOLDING THAT FOREIGN TRAVEL, VEHICLE, BROAD BAND USAGE, SUB SCRIPTION, REST HOUSE EXPENSES, PANTRY EXPENSES, HOTEL/ RESTAURANT, ECGC PREMIUM AR E NOT IN NATURE OF COMMON OVERHEAD EXPENSES WITHOUT APPRECIATING THE FACT THA T THE ASSESSING OFFICER HAD ESTABLISHED IN THE ASSESSMENT ORDER THAT THESE EXPE NDITURES WERE COMMON IN NATURE AS THEY EFFECT DIRECTLY OR INDIRECTLY TO ALL UNITS OF THE COMPANY AND AFTER WORKING OUT THE COMMON OVERHEAD EXPENSES FOR SILVASA UNIT-II OF RS. 1,55,46,719/- INSTEAD OF RS. 57,27,245/- AS CLAIMED BY THE ASSESSEE, THE AO ACCO RDINGLY, WORKED OUT THE REVISED ALLOWABLE DEDUCTION U/S 80IB. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) ERRED IN DIRECTING THE AO TO ALLOCATE THE COMMON EXPENSES AS THE DECISION IN ASSESSEES OWN CASE FOR A.Y. 2009-10, WHEREIN THE! ID. CIT(A) HELD THE ACTION OF THE AO IN RE- ALLOCATING THE COMMON EXPENSES VIZ INSURANCE PREMIU M AND DOMESTIC TRAVELLING EXPENSES ON THE BASIS OF TURN OVER RATIO AS INCORRE CT WITHOUT APPRECIATING THE FACT THAT ALL THE FIVE UNITS OF THE ASSESSEE ARE CLOSELY CONNECTED, THEREFORE, THESE EXPENDITURES ARE REQUIRED TO BE ALLOCATED ON THE BA SIS OF TURN OVER RATIO FOR RE- WORKING THE ALLOWABLE DEDUCTION U/S 80IB FOR GETTIN G THE TRUE PICTURE OF THE PROFIT OF EACH UNIT. 3. THE ORDER GIVING EFFECT TO THE ORDER OF THE LD. CIT (A) IS AS UNDER:- OFFICE OF THE ASSTT. COMMISSIONER OF INCOME TAX CIRCLE-4,4 TH FLOOR, ROOM NO. 403 AAYAKAR BHAVAN, RACE COURSE CIRCLE, BARODA-390007 NAME AND ADDRESS OF THE ASSESSEE TRANSPEK SILOX IND USTRY LTD. KALALI ROAD, ATLADRA, BARODA PAN AAACT3739J ASSESSMENT YEAR 2010-11 STATUS COMPANY DATE 13.12.2013 ITA NO. 75/A HD/2014 . A.Y. 2010-11 3 ORDER GIVING EFFECT TO THE ORDER OF CIT(A) IN VIEW OF CIT(A)S ORDER IN APPEAL NO. CAB/III-259 /2012-13 DATED 18.10.2013, THE INCOME IS REVISED AS UNDER;- TOTAL INCOME AS PER ORDER U/S 143(3) DATED 04.01.2013 : RS. 45,90,35,340/- LESS-RELIEF ALLOWED BY CIT(A) (1) OUT OF 80IB RS. 4,43,506/- (2) OUT OF MISC. EXPENSES RS. 3,92,457/- RS. 8,35,963/- REVISED TOTAL INCOME RS. 45,81,99, 377/- REVISED ACCORDINGLY. ` GIVE CREDIT OF PRE-PAID PAID, AFTER DUE VERIFICAT ION. ISSUE REFUND/CHALLAN ACCORDINGLY. (KANUPRIYA DAMOR) ASSTT. COMMISSIONER OF INCOME-TAX CIRCLE-4, BARODA 4. THE TAX EFFECT IN REVENUES APPEAL IS AS UNDER:- TRANSPEK SILOX INDUSTRY LTD. A.Y. 2010-11 COMPUTATION OF TAX EFFECT FOR DEPARTMENTS APPEAL ITA NO. 75/AHD/2014 ITA NO. 75/A HD/2014 . A.Y. 2010-11 4 AMOUNT (RS.) AMOUNT (RS.) TOTAL INCOME AS PER AO ADD: RELIEF ALLOWED BY CIT(A) L)OUTOF80IB 2)OUTOFMISC EXP. SUB TOTAL 459035340 443506 392457 459871303 459035340 TOTAL INCOME 459871303 459035340 TAX @33.99 % ON ABOVE 156310256 156026112 TAX EFFECT 284144 5. A PERUSAL OF THE ABOVE CHART CLEARLY SHOWS THAT THI S APPEAL BY THE REVENUE HAS TO BE DISMISSED IN THE LIGHT OF THE CBDT CIRCUL AR NO. 21 OF 2015 DATED 10.12.2015 BY WHICH THE BOARD HAS DIRECTED THE REVE NUE AUTHORITIES NOT TO PREFER ANY APPEAL BEFORE THE TRIBUNAL WHERE THE TAX EFFECT IS LESS THAN RS. 10 LACS. 6. IN THE LIGHT OF THIS CIRCULAR OF THE BOARD, APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 06 - 04- 20 17 SD/- SD/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 06/04/2017