9911796707
TMI Blog2006 (2) TMI 491X X X X Extracts X X X X X X X X Extracts X X X X ..... Sonde, learned Authorised Representative appeared for the assessee and Mr. Durgesh Sumrott, Departmental Representative appeared for the revenue. 4. We have heard the rival submissions. The brief facts of the case are that during the year under consideration the assessee had claimed deduction under section 80-IA of the I.T. Act at Rs. 1,10,70,072 for Achhad Unit-II at the 30 per cent of the gross total income of Rs. 3,69,00,240. The search and seizure operation under section 132 of the I.T. Act were conducted on the group concerns of the assessee mainly on the allegation of claim of wrong deduction under section 80HH/80-IA of the I.T. Act. No search and seizure operations were carried out at the premises of the assessee. The group conce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oth the cases and the assessment order in the case of the assessee is on similar lines to that in the case of M/s. Sanghavi Woods Ltd. In the assessment order the Assessing Officer has alleged that the assessee has not complied with the notices issued from time to time and the books of account were also not produced before the completion of the assessment. The Assessing Officer had made categoric allegations against the attitude of assessee in non-attendance and non-compliance during the course of assessment proceedings. The CIT(A) confirmed the disallowance of deduction claimed under section 80-IA of the Act as because of the non-appearance and non-production of books of account to substantiate the claims. The CIT(A) further observed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer with regard to the eligibility of claim of deduction under section 80-IA of the Act. In order to qualify for the claim of deduction under section 80-IA of the Act the following conditions are to be fulfilled as laid down by the provisions of the Act : 1.Not formed by splitting up or the reconstruction of the business already in existence. 2.Not formed by transfer to a new business of machinery or plant previously used for any purpose. 3.It manufactures or produces any article or thing. 4.Not employed 10 or 20 or more workers in a manufacturing process carried on with aid of power or without the aid of power. Without prejudice to the above, alternatively why the income should not be computed by invoking sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said provisions. The assessee is in the 6th year of its manufacturing activity and the said deduction has been allowed in all the years prior to the year under consideration. In the case of the sister-concern i.e., M/s. Hindustan Pencils Ltd., the claim of deduction under section 80-IA with regard to manufacturing of erasers has already been allowed by CIT(A), which has reached finality as revenue has not filed any appeal against the said order. We are of the view that the assessee is entitled to the deduction under section 80-IA of the Act. Regarding the allegation of the Assessing Officer that the assessee had employed workers whose number was less than ten, it is claimed by the assessee that during the year under consideration it emplo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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