TaxTMI 
TaxTMI 
2018 (9) TMI 711
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....009) as per which the "income derived from industrial undertaking has been held to be eligible for the said deduction and not the income attributable to industrial undertaking". 2. The Ld. CIT (A) has erred in law and on facts in holding that customer advances written back amount to sale and can be said to be derived from the eligible business u/s 80IC ignoring the ratio established by the Hon'ble Supreme Court in the case of Liberty India Vs. CIT 183 Taxman 349 (2009) as per which the "income derived from industrial undertaking has been held to be eligible for the said deduction and not the income attributable to industrial undertaking". 3. The Ld. CIT (A) has erred in law and on facts in holding that sundry balances of provisions written back amounting to Rs. 30,74,769/- are eligible for deduction u/s 80IC ignoring the ratio established by the Hon'ble Supreme Court in the case of Liberty India Vs. CIT k83 Taxman 349 (2009) as per which the "income derived from industrial undertaking has been held to be eligible for the said deduction and not the income attributable to industrial undertaking." 3. The assessee has raised the following grounds of appeal in CO No....
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.... and customer advance written back. However, he held that on misc income assessee is not eligible for deduction. Therefore, assessee and AO both are in appeal before us. 6. Vide ground No. 1 the revenue has challenged that foreign exchange fluctuation amounting to Rs. 28559697/- is not eligible for deduction u/s 80IC. 7. The ld Departmental Representative supported the order of the ld Assessing Officer and submitted that such income is not derived from the industrial undertaking. He further relied on the decision of the Hon'ble Supreme Court in case of Liberty India Vs. CIT. 8. The ld Authorised Representative relied on para No. 10 of the order of the ld CIT(A). He further stated that in CIT Vs. Nobel Software Development India Pvt. Ltd 260 CTR 272, Hon'ble Karnataka High Court after considering the decision of the Hon'ble Supreme Court held that assessee is eligible for deduction on such income. It was further stated that identical issue has been considered in assessee's own case for Assessment Year 2008-09 and it has been held that such foreign exchange gain is eligible for deduction u/s 80IC of the Act. 9. We have carefully considered the rival contention....
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....king during the year. It was stated by ld Assessing Officer that it does not have a first degree nexus with the eligible business of the assessee. Hence, he denied deduction thereon. The ld CIT(A) decided the issue in favour of the assessee. As the provision made was considered as reduction in eligible profit its reversal should be considered as income of undertaking. 14. We do not find any infirmity in the order of the ld CIT(A), hence ground No. 3 is dismissed. 15. Accordingly, ITA No. 207/Del/2015 filed by the AO is dismissed. 16. The CO No. 250/Del/2015 is just supporting the order and does not agitate any specific issue but is general in nature hence, same is dismissed. 17. ITA No. 315/Del/2015 filed by the assessee is on the issue that miscellaneous income recovered from customer on account of business expenses and related cost has been held by the ld CIT(A) as income not derived from industrial undertaking. 18. The ld Authorised Representative submitted that same is allowable whereas, the ld DR relied upon the order of the ld Assessing Officer. 19. We have carefully considered the rival contentions and also perused the orders of the ld CIT(A) who vide para ....
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....ND IN CIRCUMSTANCES OF THE CASE, THE CIT (A) 1 DEHRADUN HAS ERRED BY NOT APPRECIATING THE SUBMISSIONS MADE BY THE ASSESSEE AS WELL AS BRUSHING ASIDE THE VARIOUS COURT PRONOUNCEMENTS & MATERIAL MADE AVAILABLE TO HIM. 3. THAT THE ASSESEE RESERVES THE RIGHT TO INTRODUCE ANY OTHER GROUND OF APPEAL AND NEW FACTS WITH THE KIND PERMISSION OF YOUR HONOURS." 23. At the time of hearing the ld Authorised Representative submitted that in appeal of the revenue the solitary ground raised is against the order of the ld CIT(A) where the customer's advance returned of Rs. 1439750/- held by the ld Assessing Officer that same is not income derived from industrial undertaking and therefore, not eligible for deduction u/s 80IC of the Act was reversed. The ld CIT(A) held that such income is income derived from industrial undertaking following the order of his predecessor for Assessment Year 2009-10. It was stated that the tax effect involved in the appeal is Rs. 478249/- and therefore, it is covered by Circular No. 3/2018 dated 11.07.2018. 24. The ld Departmental Representative also agreed with the same. 25. At the outset of the hearing itself, the ld. DR brought to our attention that ....