2013 (2) TMI 524

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.... for A.Y.1992- 93 u/s.147 of the Income-tax Act, 1961? B. Whether on the facts and in the circumstances of the case, Income-tax Appellate Tribunal, was right in law in upholding that the claim of deduction u/s.80-I of Rs.3,65,147 was excessive and as such admissible? C. Whether on the facts and in the circumstances of the case, Income-tax Appellate Tribunal, was right in law in upholding the basis of allocation of expenses for the purpose of computing deduction u/s.80-I of the Income-tax Act, 1961 without any reasoned order? D. Whether on the facts and in the circumstances of the case, the conclusion reached by the Income Tax Appellate Tribunal to hold the basis of allocation of expenses to computed deduction u/s.80-I of the Income....

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..../s.80I. As against gross total income of Rs.1,59,16,470/- from all the four units, the deduction u/s.80I was computed in the return at Rs.1,59,31,868/- indicating thereby that entire profit was from Baroda Unit and all other units put together making losses. It was found that the profit of Baroda unit was computed by allocating a proportion of total income and expenditure on some basis best known to the assessee. Following discrepancies are noticed:- a) The assessee has not allocated printing expenses and feature expenses to Baroda unit. b) Establishment expenses debited to the Head Office at Ahmedabad have not been proportionately allocated to Baroda Unit. c) The proportion of subscription income and raw material consumption is....

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....dings. In the original proceedings only the prior period expenses were considered and adjusted. Therefore there cannot be case of change of opinion as to whether head office expenses were properly and reasonably allocated to Baroda Unit or not. It has not been pointed out by the assessee that the issue of allocation of expenditure was considered by the Assessing officer in the original assessment proceedings and he was satisfied on such allocation. Explanation 2 of Section 147, as amended with effect from 01-04-1989, provides that if allowances under this act have been computed excessively, then it will be the case of deemed escapement assessment. For the sake of convenience we reproduce section 147 of the act as under. Section 147.... ....