2015 (2) TMI 315 - AT - Income Tax

Disallowance u/s 10B - CIT(A) deleted the addition - Held that - Respectfully following the judgement of Regency Creations Ltd. 2012 (9) TMI 627 - DELHI HIGH COURT , we allow the grounds of Revenue and restore the order of the AO disallowing the claim made by the assessee u/s 10B of the Act. - Decided against assessee. Eligibility for deduction u/s 10A - Cross objection - Held that - As relying on the case of ITO vs. Neetee Clothing (P) Ltd. 2010 (1) TMI 53 - ITAT DELHI-A it is decided cross Objections cannot be raised, wherein an entirely new claim is sought to be made.Thus we dismiss the grounds of C.O. as not maintainable .- Decided against assessee.

Summary

Issues:
1. Delay in filing Cross Objections for AY 2009-10
2. Eligibility for deduction u/s 10B of the Act
3. Computation of deduction u/s 10B for AY 2008-09
4. Maintainability of Cross Objections for AY 2008-09

Issue 1: Delay in filing Cross Objections for AY 2009-10:
The delay of 179 days in filing Cross Objections was contested by the assessee, citing reasons such as lack of knowledge regarding relevant judgments until advised by legal counsel. The assessee sought condonation of delay based on precedents and argued for admission of Cross Objections. The Tribunal, after considering the facts and sequence of events, condoned the delay and admitted the Cross Objections.

Issue 2: Eligibility for deduction u/s 10B of the Act:
The assessee, a 100% export-oriented unit, claimed deduction u/s 10B for the AY 2008-09 and 2009-10. The AO disallowed the deduction, but the First Appellate Authority allowed it based on a Tribunal decision. However, the Tribunal, following the decision of the Jurisdictional High Court, ruled against the assessee, disallowing the claim for deduction u/s 10B for both assessment years.

Issue 3: Computation of deduction u/s 10B for AY 2008-09:
The Revenue appealed for the AY 2008-09, challenging the computation of deduction u/s 10B, specifically related to setting off brought forward losses and unabsorbed depreciation. As the Tribunal held the assessee was not entitled to deduction u/s 10B, these grounds became irrelevant, and the appeal for AY 2008-09 was allowed in favor of the Revenue.

Issue 4: Maintainability of Cross Objections for AY 2008-09:
The assessee filed Cross Objections for AY 2008-09, claiming eligibility for deduction u/s 10A as an alternative to u/s 10B. The Revenue opposed the maintainability of the Cross Objections, citing precedents and legal principles. The Tribunal, following the decision in a similar case, dismissed the Cross Objections as not maintainable, as the issue raised did not arise from the order of the Appellate Authority.

In conclusion, the Tribunal allowed the appeals of the Revenue for both assessment years and dismissed the Cross Objections of the assessee, emphasizing the adherence to legal precedents and jurisdictional decisions in determining the eligibility for deductions under the Income Tax Act.