AI Drafter 
TaxTMI 
TaxTMI 
2013 (10) TMI 1020
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....s.2,03,68,535/- for Co-generation plant by invoking the provisions of subsection (8) of section 80IA of the Act. Ld. CIT(A) completely erred in not appreciating the fact that the Hon'ble Tribunal in A.Y.2006/07adjudicated ground against disallowance of deduction claimed u/s. 80IA in case of new power plant only (covered before him vide ground No.8) whereas deduction denied in respect of captive power plant as well as co- generation plant through oversight is not at all discussed in the said order of the Hon'ble Tribunal. Ld. CIT(A) ought to have independently adjudicated these issues instead of setting them aside to AO to follow order of the earlier year. 2. Ld. CIT(A) erred in law and on facts in confirming action of AO in making addition of irrecoverable balances written off of Rs.89,000/- following order of the Hon'ble Tribunal for A.Y.2006/07. Ld. CIT(A) failed to appreciate that the amount written off during the year was on account of old balance of call & allotment money receivable whereas in A.Y. 2006/07 write off was in respect of advances given against purchase ground on merits instead of following Tribunal order of earlier year based on entirely different set of facts.....
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.....903/te 14,58,28,557/- - Electricity 2,35,33,028 @ 5.835/Unit 13,73,05,315/- 28,31,33,872/- Less: Actual cost of generation of steam & Electricity 18,14,19,979/- GAIN/LOSS as per books before depn & lease rent : 10,17,13,893/- The Ld. A.O. has calculated the gain at 35.70%. The same seemed inordinately high and the A.O given the reasonable opportunity of being heard on this issue which was responded by the appellant before him. After analyzing the assessee's reply and Auditor's certificate, it was found to the A.O. that the credit for steam has been taken at rate of Rs. 564.903 which was the actual cost of generation of steam. Hence, no profit is accounted for on the generation of steam. As such, the entire profit arises from the credit for electricity which was 74.08% as per the Auditor's Certificate. Since, the Ld. A.O. found high rate of profit, therefore, he applied to ascertain the methodology. The rate of credit for electricity was taken at Rs.5.835 and the basis for the same was called for. It was submitted before the Ld. A.O. that the same was the Gujarat Electricity Board rate which was adopted for taking credit. The Ld. A.O. had not fo....
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.... the gain arises at 17.20%. On the same rationale as in case of Captive Power Plant discussed above, it is seen that the entire profit arises from the credit for electricity which was 22.23% as per the Auditor's Certificate. Considering the assessee's own computation as per the Auditor's Certificate, the deduction u/s. 80IA was computed by the Ld. A.O. as under :- Particulars Qty. Rate Amount Cost Profit Credit for steam 9.399 564.9 5309608 5309608 NIL Credit for Electricity 16380000 5.594 91629720 74958580 16671140 TOTAL 16671140 Add: Depreciation as claimed 4133274 Less: Depreciation on lease rent as claimed 435879 20368535 The Ld. A.O has applied both the methods on Co-generation plant which is reproduced as under :- (a) Reducing the notional rate of credit from Rs.5.835 to Rs. 4.335 Steam 9399 X 559.224 53,09,668/- Electricity 16380000 X 4.335 7,10,07,300/- 7,63,16,908/- Less Cost of generation 8,02,68188/- (-) 39,51,280/- (b) Reducing the profit re-computed at 22.23% to 17.20% Electricity as claimed 16380000 X 5.594 9,16,29,720/- Profit @ 17.20% ....
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....ing around deduction u/s. 80IA and matter had been sent back to the A.O. in A.Y.2006-07, the identical issue is involved in the year under consideration, therefore, we are restoring back this entire issue to the Ld. A.O. for de novo. This ground is allowed for statistical purpose only. 6. Ground No.2 is against confirming the addition on account of irrecoverable balance written off of Rs.89,0000/- following the order of the Hon. ITAT in A.Y.2006-07 by the Ld. CIT(Appeals). The Ld. A.O. found that the assessee had written off of Rs.89,0000/- irrecoverable against old balance of allotment and call money. The Ld. A.O. given the reasonable opportunity of being heard and the assessee admitted before the Ld. A.O its capital expenditure which was not found satisfactory to the A.O. He made the addition of Rs.89,000/- 7. The Ld. CIT(Appeal) confirmed the addition by observing that the similar addition made in A.Y. 2006-07 has been dismissed by the ITAT vide order dated 13.07.2012 in ITA No.3118/Ahd/2010. The Ld. Consul fairly accepted that the decision of the Hon. ITAT is against the assessee which was confirmed by the Ld. A.R. In A.Y. 2006-07 the amount given to M/s. Sando Industries....
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....cision in case of Daga Capital Management Pvt. Ltd vide ITA No.805/Mum/2003 for A.Y. 2001-02 SB, decision of Hon. ITAT and Hon. Bombay High Court in case of M/s. Godrej & Boyce Manufacturing Ltd. And also SB decision of ITAT Delhi bench in case of Cheminvest Ltd. The Ld. A.O. calculated the disallowance on the basis of Rule-8D. The Ld. CIT(Appeal) had followed the ITAT order on this issue for A.Y. 2006-07 and Ld. A.O. was directed to decide the case as per the order of the ITAT in A.Y.2006-07. 11. The Ld. CIT(Appeal) had followed the ITAT order on this issue and Ld. A.O. was directed to decide the case on the basis of ITAT decision in A.Y.2006-07 as discussed above. Both the sides has agreed that this issue is identical with A.Y.2006-07 and may be sent back to the Ld. A.O. Respectfully, following the decision of A.Y. 2006-07 of Coordinate 'D' Bench, being the identical issue involved under the year under consideration, therefore, we set aside the issue to the Ld. A.O. for de novo. This ground of appeal is allowed for statistical purposes. 12. The second ground of appeal of revenue is against deleting the positive adjustment of Rs.3,25,92,000/- to book profit u/s. 115JB. The L....