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TMI Blog2012 (7) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... ade by the AO without appreciating the fact that the adjustment was made as per Explanation 1(f) to Section 115JB of the IT Act. (ii) Giving part relief to the assessee without assigning any specific reasons. (iii) Deleting the addition of Rs. 39,68,062/- without appreciating the provisions of section 36(2) of the IT Act and the fact that no explanation was tendered by the assessee during the course of the assessment proceedings with regard to the claim of bad debt. (iv) Granting relief to the assessee subject to the verification by the AO when no such power is vested with the CIT(A) under the provisions of the Act. (v) Deleting the addition to the extent of Rs. 13,68,671/- without appreciating the fact that no explanation was tendered by the assessee during the course of the assessment proceedings with regard to the claim of prior period expenses. (vi) Considering the employee benefit expense as ascertained liability instead of contingent liability without appreciating the fact of the case. (vii) Allowing the deduction u/s 80IB and 80IC on the facts and circumstances of the case. (viii) Appreciating the decision of the Hon'ble Supreme Court in the case of Textile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not derived from the industrial undertaking. 5. Deduction u/s 80IB/80IC on bought out components: a. That the ld. CIT(A) has erred in confirming the treatment of AO on Rs. 1,08,12,103/- as profit from sale of bought out components as being ineligible for deduction u/s 80IB and 80IC. b. The ld. CIT(A) has erred in accepting the method of calculation of ineligible profit used in above point No. 5(a), which has been computed at the assumed rate of 15% of the total purchase price of Rs. 6,12,68,584/- and is arbitrary and bad in law. 6. Consequential: a. That the AO erred in levying interest u/s 234B/234D and withdrawing interest u/s 244A of the Act. b. That AO erred in initiating penalty proceedings u/s 271(1)(c). 7. That the appellant craves leave to add, alter, amend, modify or forego any ground of appeal with the permission of the Hon'ble Bench of Income Tax Appellate Tribunal, before or at the time of hearing/final disposal of this appeal. Any other point as may be necessary at the time of hearing of appeal. That the above grounds are independent and without prejudice to one another." 5. The assessee in ITA No. 1021/Chd/2011 has raised the following grounds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the amount at Point No. 8(a) being treated as ineligible has been computed at the assumed rate of 30% of the total amount of Rs. 64,52,083/- which is arbitrary and bad in law. 9. Deduction u/s 80IB / 80 IC on bought out components: a. That the ld. CIT(A) has erred in confirming the treatment of AO on Rs. 1,15,07,683/- as profit from sale of bought out components as ineligible for deduction u/s 80IB and 80IC. b. The ld. CIT(A) has erred in accepting the method of calculation of ineligible profits used in above point No. 9(a), which has been computed as the difference of sale and purchase of bought out components and is arbitrary and bad in law. 10. Deduction u/s 80IB/80IC on High Sea Sales: That the ld. CIT(A) has erred in confirming the treatment of AO on Rs. 16,26,261/- as profit from High Sea Sales as being ineligible for deduction u/s 80IB and 80IC. 11. Deduction of profits eligible for Section 80 - Hon'ble High Court in AT calculation: Despite being fully covered by Hon'ble Supreme Court, the ld. CIT(A) has erred in confirming the addition of Rs. 2,35,61,691/- in Book Profits u/s 115JB which was claimed as deduction as amount of profits eligible u/s 80HHC v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee to its employees. The AO noted that special resolution was passed at the extra ordinary general meeting held on 31.3.2006 for the purpose of issue of equity shares to the employees as Sweat equity. The fair value of the equity share was adopted at Rs. 106.26p and the shares were issued under the scheme with lock in period of five years. No allotment to issue such shares was done and the same was pending on 31.3.2006. The said shares were included in shares outstanding account. In case any of the employees left the employment before the expiry of lock in period of five years, his shares were to be forfeited by the Management. As per the AO, the said expenditure booked to the profit and loss account, was not an ascertained liability but was a contingent liability, as it was not benefit conferred on the employees without any restrictions. Accordingly the same was not allowed as an expenditure during the year. 6.1. The assessee had claimed deduction u/s 80IC/80IB of the Act. The plea of the assessee was that it had started its commercial production w.e.f. 1.12.2004 after taking over as going concerns, two running manufacturing partnership firms namely M/s Spray Engineering De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... services and AMC services and estimated the same to be 30% and deduction u/s 80IB and 80IC on the income of Rs. 12,52,627/- was not allowed. Further the assessee had shown other income of Rs. 23,39,114/- on which a sum of Rs. 8,36,020/- was claimed as deduction u/s 80IB/80IC of the Act. The AO held that the nature of income shown under other income could not be derived from manufacturing activity. Interest on income tax refund was held to be income from other sources and other amounts were the income u/s 41 of the Act and rental income were not derived from manufacturing activities. The word 'derived from' being narrower, the claim of deduction u/s 80IB/80IC on other income of Rs. 8,36,620/- was rejected. 8. The next issue considered by the AO were the items being purchased directly from the market and being supplied to the customers i.e. the Voltage stabilizers, motors etc. The AO was of the view that the benefit of deduction u/s 80IB/80IC on such items had been considered and was not part of goods manufactured, could not be allowed. The total purchases of such goods were Rs. 6.12 crores and profit earned on the said goods was estimated at 15% being Rs. 1.08 crores and o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal allowed the claim of the assessee in view of the assertion of the assessee that in case the employee leaves the organization, the assessee was offering to tax in the subsequent year, the value of forfeited shares by the Management. The CIT(A) thereafter considered the claim of the deduction u/s 80IB/80IC of the Act elaborately vide paras 72 to 80 of the appellate order. Placing reliance on the circular issued and the ratio laid down in Tech Books Electronics Services P.L., 100 ITD 125 (Delhi) where identical issue was involved held that the assessee was entitled to deduction u/s 80IB/80IC of the Act for the unexpired period. 11. The next issue before the CIT(A) was the disallowance of deduction u/s 80IB which relates to AMC and other incomes. The deduction claimed on AMC was not held to be derived from the business of undertaking in view of ratio laid down by any Coral Telecom Ltd. in ITA No. 203/Chd/2005. The order of the AO in estimating the expenditure allowable out of the aforesaid receipts was also upheld by the CIT(A). The CIT(A) also upheld the disallowance u/s 80IB/80IC on other income. The CIT(A) also upheld the order of the AO on not allowing deduction u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preme Court in Apollo Tyres (supra), are peri metria. As per the Explanation to section 115JB of the Act, book profit is defined to be the net profit shown in the Profit & Loss Account for the relevant previous years as increased/reduced by the amounts specified in the clauses mentioned thereunder. The disallowance worked in the hands of the assessee under the provisions of section 14A of the Act is not covered by the aforesaid clauses and consequently we are in conformity with the order of the CIT (Appeals) in allowing the claim of the assessee by holding that no addition of Rs. 14,05,700/- is warranted, while computing the book profits under section 115JB of the Act. The ground Nos. 1(i) and 1(ii) raised by the Revenue are thus dismissed. 15. The issue in ground No. 1(iii) and 1(iv) is in relation to the deduction claimed on account of bad debts. The Assessing Officer had made an addition of Rs. 39,68,062/- on account of bad debts as the assessee had failed to furnish any information in respect thereof. 16. Before the CIT (Appeals) the claim of the assessee was that by an error the aforesaid evidence was not filed before the Assessing Officer and no further query was raised by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of addition made on account of prior period expenses. The assessee during the year under consideration had claimed prior period expenses totaling Rs. 16,49,912/- and in the absence of the details, the said amount was disallowed by the Assessing Officer. 20. Before the CIT (Appeals), the claim of the assessee was that sum of Rs. 13,68,671/- was disallowed by the assessee itself and added back as its income in the computation of income filed for the year under consideration. The CIT (Appeals) vide para 56 noted that sums of Rs. 8,36,671/-, and Rs. 5,32,000/- were disallowed by the assessee under the head 'preliminary expenses written off in unit-I' and Rs. 9,63,000/- under the head 'gratuity'. The CIT (Appeals) in view thereof allowed the claim of the assessee to the extent of Rs. 13,68,671/- and the balance addition of Rs. 2,81,241/- was confirmed by the CIT (Appeals). 21. The Revenue is in appeal against the aforesaid deletion of Rs. 13,68,671/-. 22. We are in conformity with the observations of the CIT (Appeals) that where the amount relating to prior period has been offered to tax by the assessee itself by way of re-adjustment of profits while filing retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account in the balance sheet. The reason for creating this share outstanding account of Rs. 4,19,39,972/- in the balance sheet is that at the time of finalizing the balance sheet i.e. 31st March, 2006, the company had offered fro sale 3,94,692 sweat equity shares by passing a board resolution and disclosure have been made in the balance sheet under the head "issued share capital". 25. The Assessing Officer vide para 11.4 observed as under: "Now from above it becomes evident that the said expenditure booked to Profit and Loss account was not an ascertained liability of Rs. 4,19,39,972/- but a contingent liability. It is not a benefit conferred on the employees without any restrictions. The employee was not free to encash these shares. Further resolution was passed on 31-03-2006 and amount taken to share outstanding account. No option was given or exercised by the employees for these shares upto the end of the financial year. The liability of the company would get determined when the employee gives its option and is able to encash it without any restriction. However this is not so in the year under consideration. So, the amount of Rs. 4,19,39,972/- not being an ascertained liabil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s covered by the ratio laid down in Ranbaxy Laboratories Ltd. v. Addl. CIT [124 TTJ 771 (Del)], EIMC K.C.P. Ltd. v. CIT [242 ITR 659 (SC) and VIP Industries v. DCIT [ITA No. 7242/Mum/2008 - date of order 17.9.2010. The learned D.R. for the Revenue also pointed out that the facts are enumerated by the CIT (Appeals) at page 28 of the appellate order. 30. The learned A.R. for the assessee pointed out that liability had crystallized and it was not contingent liability. The above said expenditure was incurred for benefit of the employees and was to be allowed as a deduction. The learned A.R. for the assessee further pointed out that the reliance placed by the learned D.R. for the Revenue on the ratio laid down in Ranbaxy Laboratories Ltd. [124 TTJ 771 (Del)] was in respect of allotment of shares of technical know-how and it was not applicable. 31. We have heard the rival contentions and perused the record. The issue raised vide present grounds of appeal is in relation to the equity shares to be issued to the employees as sweat equity. The assessee vide special resolution passed at the extraordinary general meeting held on 31.3.2006 had allotted 394692 number of equity shares @ Rs. 106 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid down in VIP Industries v. DCIT (supra) where the issue raised was in respect of claim of expenditure being the difference between the market price of the shares and price at which shares were allotted to the employees under ESOP scheme. In the facts of the present case before us, what has been booked as expenditure, is the value of shares allotted to the employees under the sweat equity scheme. In the totality of the facts and circumstances of the case, we are in agreement with the CIT (Appeals) in allowing claim of deduction. 32. Ground Nos. 1((vii) to 1(ix) raised by the Revenue are against deduction claimed under section 80IB/80IC of the Act by the resultant company. 33. The assessee company had taken over the business of two partnership firms and as per the Assessing Officer because there was no demerger or amalgamation but reconstruction of the business of the assessee, it was not eligible for deduction under section 80IB of the Act. The CIT (Appeals) had allowed the claim of the assessee. 34. The learned D.R. for the Revenue stressed that the observations of the CIT (Appeals) are incorrect as where the status of partnership firm had changed to an Indian company, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee company, deduction under section 80IB/80IC of the Act for the remaining period was available to the assessee company. The Tribunal (supra) in assessee's own case while deciding appeal in assessment year 2005-06 have held that deduction under section 80IB/80IC of the Act was available to the undertaking and not the assessee as envisaged in CBDT Circular No. F15/5/63/IT (A-1) dated 13.12.1963. The Tribunal further held that the provisions of section 80IA(12) of the Act were not applicable to the facts of the present case as business of the two firms had been transferred under the scheme of the Income Tax Act. The Hon'ble Punjab & Haryana High Court in CIT v. Mega Packages (supra) had also laid down the proposition that the benefit admissible to an undertaking under section 80IC of the Act for the remaining period could not be denied to the assessee on the ground that section 80IA(12) of the Act embraces only the cases of amalgamation or demerger of Indian company. It was further held that where the proprietaryship business was taken over by the partnership concern, it could not be held to be the result of splitting or reconstructing of business already in existenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce under section 14A of the Act. The Assessing Officer vide para 4.8 considering the total expenditure and the investment made by the assessee which admittedly was made in the preceding years in relation to the total assets held by the assessee, computed the disallowance on account of interest under Rule 8D(2)(ii) of the Act at Rs. 12,55,100/- and further made disallowance of Rs. 1,50,600/- on account of other amount disallowable, resulting in disallowance of Rs. 14,05,700/-. The said observation of AO was upheld by the CIT (Appeals) vide para 2.1 of the appellate order against which assessee is in appeal. 38. The learned A.R. for the assessee pointed out that the assessee company had made investment of Rs. 3.01 crores in M/s Shree Sai Baba Sugar Mills Ltd, which was a sick sugar mill and there was no intention to earn dividend income from such investment and further no dividend was received as the said company was in losses. It was further stressed by the learned A.R. for the assessee that no expenses were incurred during the year under consideration to safeguard such investment. The Ld. AR further stressed that the funds borrowed in the nature of term loan and CC limits were re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sick company in order to take over the said company for widening its operation of business, cannot be held to be investment per se. The decision making of a business man by way of strategy planning in allied line of business is a decision made in the course of carrying on the business and the Assessing Officer cannot sit in judgment seat to comment upon the same. Once the assessee has been found to have made a business investment by way of shares in related line of business, the said investment though held by way of shares in the said company cannot be subjected to disallowance under section 14A of the Act, which in any case is relatable to disallowance of the expenditure out of the exempt income earned by the assessee, by way of its investment in shares of other company. In the facts of the present case the investment was purely of business nature as the company in which the amount was invested was a loss making company and there was no question of earning any dividend income from such investment. In the totality of the facts and circumstances of the case we find no merit in the orders of the authorities below in disallowing any expenditure under the garb of section 14A of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was on account of commercial expediency and consequently the ratio laid down by the Hon'ble Supreme Court in S.A. Builders (supra) was applicable, we find that the assessee has raised secured advances against which it was paying interest, which is claimed an expenditure in the Profit & Loss Account. The perusal of the copy of account placed at Annexure A-3 reflects that the assessee had transferred funds for day-to-day running of the business of its subsidiary. The amounts have been advanced for the payment of salaries or for payment of rent and even for the payment to the parties i.e. for various bills raised by the subsidiary. In addition, on monthly basis the assessee had simply transferred funds to the bank account of the assessee on various dates for which there is no justification or no commercial expediency brought on record. In the case of the assessee where it has mixed funds available for its business activity, the plea of the assessee that it had interest free funds available for the purposes of advancing to its subsidiary cannot stand in view of the ratio laid down by the Hon'ble Punjab & Haryana High Court in CIT v. Abhishek Industries [286 ITR 1 (P&H)]. The t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich are eligible for deduction under section 80IC of the Act should be derived from the manufacturing or production activity carried on by the assessee. 49. Now coming to the facts of the present case, the explanation of the assessee vis-a-vis the AMC charges received by it is as under: "With regard to the above we would like to bring to your notice that we are providing customized cooling and condensing systems to the sugar systems to the sugar systems based on our own assessment of the clients' specific needs. Client needs are based on the sizes of the sugar mill and the type of the existing equipment of the sugar mill. We also provide automation of the above said equipments based on the client needs. Further the smooth running of the automation units the AMC of these units is provided to us. AMC contract normally covers the keep up of the equipments and all damages occurred in the routine operation." 50. The assessee has furnished on record communication with certain customers to whom it had supplied the cooling and condensing systems and Annual Maintenance Contract (AMC) of the said systems were to be carried out by the assessee at negotiated terms and conditions. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the year under consideration had claimed deduction under section 80IB/80IC of the Act on other income of Rs. 8,36,020/-, the detail of which are as under: Amount (Rs. ) Excess provision written back 1,29,662/- Bad Debts recovered 5,56,696/- Income tax Refund 92,090/- Amount written off 38,234/- Rental Income 18,000/- Excess and short 1338/- Total 8,36,020/- 53. The assessee has raised the issue vide ground No.4 against the addition on account of bad debts recovered being not eligible for deduction under section 80IB/80IC of the Act. Though the assessee has raised the grounds of appeal against the addition of Rs. 8,36,020/-, but the total amount of bad debts recovered was Rs. 5,56,696/-. The claim of the assessee in relation to the said amount is that it related to the recovery of bad debts written off earlier, which had direct relation to the income of the industrial undertaking. The learned A.R. for the assessee had placed reliance on the ratio laid down in Amar Radha Battery [91 ITD 280 (Hyd)] wherein it has been laid down that the amount of bad debts should be treated as amount derived by the industrial undertaking as the write off of bad debts we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... redient of the system as without proper foundation no such installation of heavy machinery is possible but the assessee is not into doing the said work. The contract is normally for supply of such manufactured components as well as the other bought out things and the assessee enters into a civil contract for the same. So claim of the assessee that it is claiming deduction for manufacture of sugar industry machinery or cooling systems is not correct. The Assessing Officer thus held that the assessee was not entitled to the benefit of deduction u/s 80IB/80IC on such items, which have been traded by it and were not the integral part of the goods manufactured by it. The Assessing Officer, however, was of the view that the benefit of certain items were to be allowed to the assessee, i.e. nuts or bolts or sheets purchased by it. From the perusal of the Profit & Loss Account the purchase price of the traded goods was Rs. 6.12 crores and in views of the net profit rate of the assessee being approximately 14.9%, gross profit rate being approximately 48.13%, the profits earned on the traded goods was estimated at 15%. Thus sum of Rs. 1,08,12,103/- was considered as profit from trading activi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under section 80-IA of the Act is restricted to the profits and gains derived from the business of an industrial undertaking being an eligible business, subject to conditions enumerated in sub-section (2) of section 80-IA of the Act. The clause (iii) to section 80-IA(2) of the Act provides that for the eligibility of deduction, the industrial undertaking should manufacture or produce any article or thing, other than those specified in Eleventh Schedule. The deduction under section 80- IA of the Act is limited to the items manufactured or produced by the assessee. The word manufacturing or production is not defined in the Act. The distinction of the word 'manufacturing' or 'production' was clarified by Hon'ble Supreme Court in CIT v. N.C. Budharaja & Co. [1993] 204 ITR 4121 wherein it has been held as under : "The word 'production' has a wider connotation than the word 'manufacture'. While every manufacture can be characterized as production, every production need not amount to manufacture. The test evolved for determining whether manufacture can be said to have been taken place is, whether the commodity which is subjected to the process of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be got done from outside agencies on payment of labour service charges. In fact certificate issued by the Punjab Government showed that the assessee was registered as a small scale industrial unit and the trading account showed the assessee's sales of Rs. 45.98 lakhs for the year under consideration. Since the assessee was engaged in the business of manufacturing cycle pedals, it would be entitled to deduction under section 80-I even though part of such operations was got done from outsiders. Thus, the assessee was engaged in the business of manufacturing bicycle pedals and, therefore, was an industrial undertaking entitled to deduction under section 80-I." 26. The Delhi Bench of Tribunal in the case of Jackson Engineers (P.) Ltd. v. ITO [1989] 31 ITD 79 had held as under : "From the perusal of pictures given by the assessee in respect of diesel generator sets assembled or manufactured by the assessee it was clear that the same was named as 'Jackson'. The said engines were required by large industrial house for meeting their power requirements. The logo which was placed mainly on the engine was 'Jackson' and the same were made in various kinds and ranges in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ides and nothing more in the conditions of people, even the words occurring in a statute are required to be interpreted differently keeping in mind the context in which such expressions have been used in the relevant provisions of law. Therefore, the aforesaid judgment did not in any manner support the revenue's contention. The provisions of section 80-I are intended to provide an incentive for investment in certain desired sectors and promote industrialization in developing countries which has adopted the policy of liberalization." It was further held as under : "In the instant case, the assessee was purchasing different components, different equipments and spare parts from various other parties and were assembling those components, equipments and accessories and thereby they were preparing fabricating and erecting a plant which was known as ETP. The ultimate end product which was prepared as a result of assembling of various components with the constant application of technical know-how was the ETP. The ETP was obviously distinct and different plant than the various components, equipments, purchased or got manufactured according to the tailor made requirement from the dif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The objection of the learned DR for the revenue that situs of assembly is important, has been dealt with by the Pune Bench of Tribunal in Indocan Engg. Systems (P.) Ltd. v. Dy. CIT [1997] 60 ITD 649. There is no merit in the contention of the learned DR for the revenue that main activity of the assessee is of erection at client's site. The end-product is an integrated unit. The assessee is required by its clients to supply a cooling tower, parts of which are manufactured by assessee and certain parts/components are bought from outside. The end-product is the cooling tower supplied to the client. The assessee in its Quotation made to its client's requisitions, also Guarantees the above-said equipment by way of Warranty as incorporated in the Quotation at page 245 of the paper book. The Warranty is against defect in materials and workmanship when erected and operated in a manner provided by us (the assessee). 30. The Pune Bench of Tribunal in Indocan Engg. Systems (P.) Ltd. v. Dy. CIT [1997] 60 ITD 649 had held as under : "It has been held by the Supreme Court in the case of CIT v. N.C. Budharaja & Co. [1993] 204 ITR 412 / 70 Taxman 312 , that an article or thing must be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s various bought out components, which along with manufacturing components are assembled at the client's site and the cooling tower is erected. The ultimate product erected by the assessee was a cooling tower, which was a distinct product from the various components, bought from outside or manufactured by it. The aforesaid activities of the assessee were covered within the definition of manufacture of an 'article' or 'thing'. The assessee had undertaken the job of erecting a cooling tower as per the individual specification of the client, and after erection, the assessee guarantees the performance of the cooling tower as a whole and not that of manufactured items only. All the activities carried on by the assessee fall within the ambit of 'manufacture' or 'production' of an article or thing. The end-product being the cooling tower, the assessee is entitled to claim of deduction under section 80-IA of the Act on the whole including profits on manufactured items and bought out components. As held by Tribunal in Sond Bharat Pedals (India) v. ITO [2003] 84 ITD 89 (Chd.), it is not necessary that the assessee should carry out all the manufacturing ope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us the assessee is not engaged in the trading of any items, but is purchasing certain items from the market like electric motors, Watt. conductor, cables, etc. In order to complete its project of supply the customers cooling and condensing system for the sugar industry on the specific need of its clients, the bought out components are part of the assembly unit assembled by the assessee and made operational at the premises of its clients. We find no merit in the observation of the Assessing Officer that the assessee has dispatched the manufactured items alongwith bought out components for the clients of the assessee to assemble. The claim of the assessee in this regard was to the contrary. Even after assembling the unit the assessee was also providing the services by the Annual Maintenance Contractor of the said unit in entirety and we find no merit in the observation of the Assessing Officer to the contrary. Relying upon the ratio laid down in Mihir Engineers Ltd. (supra) we direct the Assessing Officer to allow the claim of the assessee on the net profits declared without deducting the profits relating to bought out components, as being, eligible for deduction under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee in assessment year 2006-07 the facts being identical, we allow the claim of the assessee. Ground No.5 raised by the assessee is thus allowed. 71. Ground No.6 raised by the assessee is not pressed hence the same is dismissed as not pressed. 72. The issue in ground No.7 raised by the assessee is against the computation of deduction under section 80IB/80IC of the Act on AMC charges. In line with our decision to ground No.3 raised by the assessee in assessment year 2006-07 the facts being identical, we allow the claim of the assessee. Ground No.7 raised by the assessee is thus allowed. 73. Ground No.8 raised by the assessee is not pressed hence the same is dismissed as not pressed. 74. The issue in ground No.9 is also against the computation of deduction under section 80IB/80IC of the Act on bought out component. In line with our decision to ground No.5 raised by the assessee in assessment year 2006-07 the facts being identical, we allow the claim of the assessee. Ground No.9 raised by the assessee is thus allowed. 75. The issue in ground No.10 raised by the assessee is in respect of computation of deduction under section 80IB/80IC of the Act on high sea sales. 76. The br ..... X X X X Extracts X X X X X X X X Extracts X X X X
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