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TMI Blog2004 (9) TMI 568X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 263 of the Act. The relevant grounds read as under : 1."The learned CIT(A) erred in assuming the jurisdiction under section 263 of the Act, when the conditions prescribed by the said section were not satisfied." 2."The learned CIT(A) erred in holding that the order of the assessing officer is erroneous." 3."The learned CIT(A) erred in setting aside the entire assessment order." 6."Having regard to the facts and circumstances of the case and the provisions of law, the appellant s submits that the order under section 263 of the Act is erroneous and without jurisdiction and that the same requires to be cancelled." 3. The brief facts of the case are that : the assessee company is engaged in the business of manufacturing and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ese bonds from Norton Co., USA. Even after starting a separate bond plant, the assessee company does not manufacture all types of bonds required for the manufacture of grinding wheels. Hence, even now, the assessee company imports the bonds, which are not manufactured by them, from Norton company. The company is not supposed to disclose the technology for the manufacture of bonds to any outsider. The company, based on its experience, developed two bonds, which it is exporting to Singapore Dubai. The assessee company is claiming deduction under section 80-IA for the Bond Plant in a sum of Rs. 95,75,001 for the assessment year 1998-99 and the same has been allowed by the Assessing Officer by his order dated 8-12-2000 under section 143(3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s presents exceptional difficulties, the Assessing Officer may compute the profits on such reasonable basis as he may deem fit and that what is reasonable is to consider all the costs incurred by the assessee and to allow a reasonable profit percentage and the other alternative is to consider the gross profit and the net profit percentages of the overall business of abrasives conducted by the assessee and to allow the same profit percentage to the eligible business under section 80-IA. For the assessment year 1998-99, the assessee company had claimed a total profit of Rs. 3,98,03,337 on a total expenditure of Rs. 1,34,16,395. This has been on account of sale revenue taken at import invoice price of bonds used in-house at Rs. 4,53,19,732. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 80-IA was highly exaggerated and the allowance of deduction under section 80-IA by the Assessing Officer in the assessment year 1998-99 on the basis of that price was erroneous in so far as it is prejudicial to the interest of revenue. Thus, the Commissioner of Income-tax-I set aside the assessment for assessment year 1998-99 and directed the Assessing Officer to make a fresh assessment in accordance with the law in the light of stand taken in assessment year 2000-01. Aggrieved by this order of the Commissioner of Income tax, the assessee moved the matter in appeal before us both on jurisdiction and on merits and of course, we are now dealing with the grounds relating to jurisdiction. 4. At the time of hearing, the learned counsel for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two views are possible and the Assessing Officer takes one view, the order of Assessing Officer cannot be said erroneous and prejudicial to the interest of the revenue. On this proposition, the following case-laws are relied upon. Sl. No. Particulars Reported in 1. Malabar Industrial Co. Ltd. v. CIT [2000] 243 ITR 83 (SC) 2. CIT v. Max India Ltd. [2004] 268 ITR 128 (P H) 3. CIT v. Mehsana Dist. Co-op. Milk 263 ITR 645 (Guj.) Producers Union Ltd. [2003] 4. CIT v. Arvind Jewellers [2003] 259 ITR 502 3 (Guj.) 5. IPCA Laboratories Ltd. v. Asstt. CIT [IT Appeal No. 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rton Co., USA, this has been accepted by the Assessing Officer in the relevant assessment year, while processing the return under section 143(3) of the Act. Further, there is no dispute about the fact that for the last 8 assessment years, i.e. up to 1999-2000, the same method has been accepted by the department, while framing assessment under section 143(3) of the Act. All these facts show that the method adopted by the assessee is a method accepted by the department up to assessment year 1999-2000 in computing the deduction under section 80-IA of the Act. May be the Commissioner of Income-tax s method be another method of arriving at the market value. Thus, in our opinion, there is more than one method of arriving at the market value for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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