TaxTMI 
TaxTMI 
2010 (11) TMI 764
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....d electricity rebate as income from other source and not as income from business. Whether the assessing officer should have allowed the set off of losses from 10A unit as against the income assessable as "business income from other units"? 2. Brief facts of the case are that the assessee company filed its return of income on 20-11-2003 admitting total income of Rs.1,20,24,573. The loss computed in 10A Units was ignored and the other income of Rs.1,20,24,573 was offered to tax. The assessment was completed under section 143(3) on 23-2-2006 determining total income at Rs.30,49,35,419. On the appeal filed, the CIT (A) allowed partial relief and the total income was computed at Rs.19.84 crores vide consequential order dated 23-1-2007.....
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....om other sources for the reason that the same was not claimed in the original return of income. It was held that the provisions of section 148 are essentially for the benefit of revenue and not for according new benefits to the assessee as held by the Hon'ble Supreme Court in the case of Sun Engineering Works Pvt. Ltd. (198 ITR 297) and K. Sudhakar S. Shanbag (241 ITR 865) (Bom.). The assessing officer held that the loss of exempted unit should be allowed to be carried forward to the next year in terms of sub-section (6) of section 10A of the Act. Aggrieved by the order of the assessing officer, the assessee went in appeal before the CIT(A). Before the CIT(A), the learned authorized representative of the assessee in his written submissions ....
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....nagement Services treated as income from business should not have allowed set off against the loss of exempted undertaking and the loss of exempted undertaking could be carried forward in terms of section 10A(b) of the Act and these were not properly noticed by the CIT(A). In support of his contentions, he relied on the decisions of Hon'ble Supreme Court in the cases of Sterling Foods Limited (231 ITR 579) and Pandian Chemicals Limited (262 ITR 278). 4. On the other hand, the learned counsel for the assessee while relying on the order of the first appellate authority submitted that the project management services performed by the assessee's UK Branch, were services performed in connection with the back office and call center servi....
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....the assessee company. Hence, the income earned by UK Branch is earned from its business operations and as such should be treated as business income and not as income from other sources. We also find that the electricity rebate was received by the assessee company as per MOU with Government of Andhra Pradesh which was adjusted against power and fuel expenses under schedule (12) of the profit and loss account. In our opinion, the electricity rebate is directly connected with the industrial unit and accordingly, the same should be characterized as income from business. Considering the totality of facts and the circumstances of the case, both the incomes are to be considered under the head 'business income' and there is no valid reason to the a....