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TMI Blog2013 (7) TMI 614X X X X Extracts X X X X X X X X Extracts X X X X ..... elhi Press Samachar Patra [2006 (3) TMI 218 - ITAT DELHI-E] , apportionment of expenses between different units without any investigation and collection any material is arbitrary. - No disallowance in this regard has been made in the past and as such even in view of rule of consistency, the disallowance made is not tenable – Decided against the Revenue Interest received on FDR - Unclaimed creditors written back - Insurance claim – Held that:- Interest was received on FDR purchased for bank guarantee and as such the income is derived from industrial undertaking relying upon the decision in the case of Orchid Chemicals & Pharmaceuticals Ltd[2005 (7) TMI 334 - ITAT MADRAS-B]; Sundry creditors were outstanding for business transaction. Hence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim cumulatively amounting to Rs. 97,597/-." 3. Apropos ground no. 1:- The assessee firm has five units. Out of five units, two units are existing in exempted zones and three are existing in taxable zones. Assessing Officer noted that from the perusal of the books and records, it was noticed that assessee has debited the entire interest in the books of taxable units. Assessing Officer found the above unjustified and unreasonable. He noted that assessee firm had paid interest amount to Rs. 80,28,863/-. Therefore, interest of Rs. 26,88,182/- was allocated to the exempted units and the claim of deduction u/s. 80IB was reduced by Rs. 26,88,182/-. 4. Assessee submitted before the Ld. Commissioner of Income Tax (A) that no bank loan was tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 6. We have heard both the counsel and perused the records. Ld. Departmental Representative supported the order of the Assessing Officer . Ld. Counsel of the assessee on the other hand supported the order of the Ld. Commissioner of Income Tax (A) and submitted brief synopsis. We have heard the rival contentions in light of the material produced and precedent relied upon. We have carefully perused the same. We find that in this case the Assessing Officer has noted that from the consolidated accounts that assessee has debited the entire interest in the books of taxable units. Assessing Officer allocated the interest to taxable and exempted units on the basis of turnover. In this regard, it is the contention of the assessee that no bank lo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer noted that from the Unit-II at Barotiwala, the assessee has claimed deduction u/s. 80IB on its 100% profits at Rs. 11,57,28,902/-. Assessing Officer noted that from the perusal of the profit and loss account of the unit, it was noticed that following receipts had been considered for computation of profits of the undertaking:- i) Interest received on FDR Rs. 14,135/- ii) Unclaimed creditors written back Rs. 57,642/- iii) Insurance claim Rs. 25,820/- Total Rs. 97,597/- 7.1 Assessing Officer held a sum of Rs. 97,597/- cannot be said to be received derived from industrial undertaking. Accordingly, deduction u/s. 80IB was reduced by a sum of Rs. 97,597/-. 8. Upo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gards the claim of Rs. 25,820/-. It is noted that Barotiwala unit of the assessee has debited Rs. 1,11,199/- paid as insurance charges and against it claim of loss of Rs. 25,820/- was received during the year. It is the claim of the ld. Counsel of the assessee that since the insurance charges paid to insurance company are treated as business expenditure, then the claim received from the insurance company is also derived from industrial undertaking. In our considered opinion, this proposition is not correct. If the insurance is claimed in the realm of revenue transaction, it will be allowed as deduction. However, if the same is on capital field, the same cannot be sold out. Hence, we remit this issue to the file of the Assessing Officer. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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