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Issues Involved:
1. Deletion of addition of Rs. 30,34,521 regarding disputed liability with M/s. MFL. 2. Computation of deduction under section 80-IB after setting off the loss of Rs. 18,06,402 from the Goa Unit. Issue-wise Detailed Analysis: 1. Deletion of Addition of Rs. 30,34,521: The revenue appealed against the Commissioner of Income-tax (Appeals)'s decision to delete the addition of Rs. 30,34,521, which was claimed by the assessee as a deduction for the provision of M/s. MFL gas bill. The Assessing Officer had initially disallowed this deduction, considering it a contingent liability since the excess bill raised by M/s. MFL was not accepted by the assessee. Upon appeal, the Commissioner of Income-tax (Appeals) noted the ongoing dispute between the assessee and M/s. MFL and ruled that it was not a contingent liability, relying on the Supreme Court decision in Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363. The revenue contended that this decision was not applicable and cited various case laws, including CIT v. Raj Motors [2006] 284 ITR 489 and Alembic Chemical Works Ltd. v. Dy. CIT [2004] 266 ITR 47 (Guj.), arguing that a contractual liability accrues only when it is finally settled. The Tribunal reviewed the contractual terms and the historical context of the billing dispute, noting that M/s. MFL had suddenly changed the basis for raising invoices after 27 years, which led to a dispute. The Tribunal concluded that the liability arises only upon settlement of the dispute, aligning with the cited case laws. Consequently, the Tribunal set aside the order of the Commissioner of Income-tax (Appeals) and restored that of the Assessing Officer. 2. Computation of Deduction under Section 80-IB: The second issue revolved around the computation of deduction under section 80-IB, where the assessee claimed a deduction of Rs. 69,54,954 from the profits of its Goa Unit before setting off a carry-forward loss of Rs. 18,06,402 from the previous year. The Assessing Officer, relying on section 80AB, held that the carry-forward loss must be set off before allowing the deduction under section 80-IB. The Commissioner of Income-tax (Appeals) directed the Assessing Officer to verify if the loss had been fully set off in the previous year and, if so, to allow the deduction in full. The revenue argued that section 80-IB(13) makes the provisions of section 80-IA(5) applicable, which requires setting off the loss before computing the deduction. The Tribunal, referencing the Special Bench decision in Asstt. CIT v. Goldmine Shares & Finance (P.) Ltd. [2008] 113 ITD 209, held that the eligible deduction under section 80-IB must be computed after setting off the loss of the Goa Unit for the previous year. The Tribunal found that the Commissioner of Income-tax (Appeals) had not properly appreciated the provisions of law and remitted the issue back to the Assessing Officer for reconsideration. Separate Judgment by Judicial Member: The Judicial Member disagreed with the Accountant Member regarding the second issue on the computation of deduction under section 80-IB. The Judicial Member argued that the eligible deduction should be computed after setting off the loss, in line with the Special Bench decision. The Third Member, agreeing with the Judicial Member, concluded that the order of the Commissioner of Income-tax (Appeals) should be reversed and that of the Assessing Officer restored. Final Order: Following the majority opinion, the Tribunal decided against the assessee on the second issue, and the revenue's appeal was allowed.
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