TaxTMI 
TaxTMI 
TaxTMI 
2017 (2) TMI 1008
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....- Div-I 2006-07 Rs.18,07,735/- Div-I 2007-08 Rs.10,39,467/- Div-II 2005-06 Rs.8,40,497/- Div-II 2006-07 Rs.2,00,237/- Div-II 2006-07 Rs.21,93,256/- 3. The ld. Departmental Representative relied on the order of the Assessing Officer. 4. Ld. Counsel for the assessee contends that the brief facts are both the assessees are partnership firm, i.e., Division-I & II, situated in the backward area of Dadra & Nagar Haveli and engaged in the manufacturing of Paper Tubes. Both the units are claimed to be eligible for deduction u/s 80IB of the Act @ 100% of income for initial five years from the date of commencement of its manufacturing activities. Returns of incomes were filed alongwith the requisite audit report provided u/s 44AB alongwith the prescribed CA certificate for eligibility u/s80IB. Survey proceedings were conducted on 17.03.2006 in the group cases of Shri Rashid Ahmed Shaikh, Vapi and the assessees are the group entities. During the course of Survey Proceedings, it was seen that on the date of survey proceedings, only the activities of Honey India Corporation Div-II are under progress and there were no activities of Div-I and Div-III. Verification of the ....
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....80IB. 4.1 Alongwith the above submission, the assessee has put a detailed argument regarding eligibility of deduction u/s 80IB. In support of his claim, the assessee has given copies of Electricity bills from April, 2004 to March, 2005, and copies of pages of wages register and also relied upon the details already furnished with earlier submission. The assessee has argued that 'it can be seen from the attendance register (in Department Custody) and the Wages Register that the assessee has been employing 8-11 workers at the Unit'. It is stated that for major part of the year 10 or more than 10 workers have been employed at the unit and have been involved in the manufacturing of Paper Tube. 4.2 The Assessing Officer further observed that, though depreciation was claimed in the P&L A/c in Schedule 'D' of fixed asset, there was no opening stock of machinery. The assessee replied that they were purchased in this year from Gajanan Engineering Works. The Assessing Officer pointed out that in Form No. 10CCB the date of commencement was certified as 28.03.2005. The assessee replied that the same was a typographical error and the production was actually commenced on 28.03.2004. The assess....
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....y of Rs. 48,47,236/- which accepts the fact that the goods are manufactured by the appellant. Under the said Central Excise Regulations, the dispatches of the finished foods are accompanied with a gate pass made from the premises of the manufacturing unit. The stipulation of the Central Excise Regulation is not found violated. In the circumstances, the outsourced processed goods also form part of the goods manufactured by the appellant. The proposal of AO to disallow the profit artificially computed on working out averages is not justified in the circumstances. The same is rejected. 5.19. In view of the aforesaid discussion ground No. 1 and 2 are decided in favour of the appellant. I hold that the disallowance of the claim u/s. 80IB was incorrect in the facts and circumstances of the case. AO is directed to allow the deduction u/s. 80IB. The assessee succeeds in these grounds of appeal." 6. Aggrieved, the Revenue is in appeal before the Tribunal. 7. The ld. DR contends that... (a) The assessee's CA certified that the date of commencement of manufacturing operations was from 28.03.2005. Thereafter, when Assessing Officer pointed out the inconsistencies, the assessee changed ....
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....sallowed. 7.3 In the remand report also, the ld. AO has clearly made out a case that the assessee's claim of purchasing of semi-finished goods from the HPT is incorrect and in fact only resale has been carried out & to create a smokescreen, the theory of payment of excise duty has been put forth. 8. The ld. Counsel for the assessee, on the other hand, contends that the assessee's pointed out that the CA by mistake has put the date 28.03.2005 as date of commencement which was a typographical error and the same is 28.03.2004. The electricity bills and other necessary evidences were examined by ld. CIT(A) and the finding of facts has been recorded in this behalf. The ld. AO in alternate has contended that proportionate deduction u/s 80IB should be given which indicates that the fact of part manufacturing by HPT and part manufacturing by assessee has been accepted. Therefore, the deduction u/s 80IB has been rightly allowed by ld. CIT(A). Reliance is placed on the decision of ITAT, Ahmedabad Benches in the case of M/s. Subhalachal Print & Pack vs. ACIT in ITA No.2128/Ahd/2007 dated 08.12.2009, wherein it was held as under:- "7. When we consider the narrow approach adopted by the low....
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.... in the case of CIT vs. Trans Asia Plast in Tax Appeal No. 1755 of 2009 ii. Hon'ble Gujarat High Court judgment in the case of CIT vs. 1- UP Clothing Co. in Tax Appeal No. 1382 of 2009 iii. ITAT, Ahmedabad decision in the case of DCIT vs. Rameshbhai C. Prajapati, [2013] 29 taxmann.com 64 (Ahd.) iv. ITAT, Ahmedabad decision in the case of ITO vs. M/s. Keval Construction in ITA No.3175/Ahd/2009. 9. I have heard the rival contentions, perused the material available on record and gone through the orders of the authorities below. As the facts emerge, the Audit Report/From No.10CCB issued by the CA is unsigned and undated. There is no other evidence placed by the assessee on the paper-book to corroborate the fact that the manufacturing activity of the assessee concern commenced from 28.03.2004. Besides, according to survey reports, the assessee could not demonstrate any manufacturing activity. Due to unsigned and unverified 10CCB certificate of CA, the verification of schedule 'D' of fixed asset also could not be made. The survey statement has not been filed by the assessee in the paper-book. Therefore, it could not be ascertained as to whether the assessee or its employees na....