2011 (6) TMI 865 - AT - Income Tax

Summary

Issues involved:
The judgment involves an appeal by the Revenue and a cross objection by the assessee against the order of the CIT(A), Jalandhar, relating to the assessment year 2005-06.

Ground raised by Revenue:
The Revenue challenged the inclusion of income from 'Sale of Raddi' and 'Printing got done from outside' in 'Eligible Profit' for deduction u/s.80IC.

Facts of the case:
The assessee's income is derived from printing, publishing, and sale of books, with a total turnover of &8377; 13,92,23,831. The Assessing Officer (A.O.) disallowed deduction u/s.80-IC for 'Sale of Raddi' and 'Printing done from outside.'

CIT(A)'s decision - Sale of Raddi:
The CIT(A) allowed the claim for 'Sale of Raddi,' citing precedents establishing a direct nexus between income and the industrial undertaking. The sale of Raddi, being a by-product of the manufacturing activity, was deemed eligible for deduction u/s.80IC.

CIT(A)'s decision - Printing done from outside:
The CIT(A) upheld the deduction for 'Printing done from outside,' reasoning that the assessee, being an industrial undertaking, should not be disentitled to the deduction for a small portion of work done externally.

Appellate Tribunal's decision:
The Tribunal upheld the CIT(A)'s decisions, emphasizing the direct nexus between income and the industrial undertaking for eligibility under section 80-IC.

Cross Objection by the assessee:
The assessee raised grounds related to the belated appeal filing by the Deputy Commissioner of Income Tax, which were dismissed by the Tribunal.

Conclusion:
The appeal by the Revenue and the Cross Objection by the assessee were both dismissed by the Tribunal, upholding the CIT(A)'s decisions regarding the eligibility of deductions u/s.80IC for 'Sale of Raddi' and 'Printing done from outside.'