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TMI Blog2013 (9) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... gorised as a Small Scale Industrial Undertaking. 3. The learned Commissioner of Income Tax (Appeals) has erred in law and facts of the case in not appreciating the fact that the assessee could not be held to be a Small Scale Industrial Undertaking under the IDR Act as it has not satisfied all the conditions laid down for it in the IDR Act. 4. The learned Commissioner of Income Tax (Appeals) has erred in law and facts of the case in not appreciating the fact that the deduction u/s 80lB is to be allowed to the assessee on the basis of the declarations made by it in Form No.10CCB filed by it. 5. The learned Commissioner of Income Tax (Appeals) has erred in law and facts of the case in not appreciating the fact that the assessee has availed all the benefits granted by the State Government to Small Scale Industrial Undertaking located in the State on the basis of its claim of being a Small Scale Industrial Undertaking. 6. The learned Commissioner of Income Tax (Appeals) has erred in law and facts of the case in not appreciating the fact that as the assessee has not satisfied the conditions laid down in the IDR Act for being a Small ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income Tax (Appeals) erred in arbitrarily disallowing a sum of Rs. 4,83,414/- u/s 14A of the Act r/w Rule 8A of the Rules. In fact, no expenditure has been incurred by the appellant on earning the dividend. (vi) Levy of Interest under Sec. 234B, 234C is liable to be cancelled as the same is arbitrary, high and contrary to law. (vii) Any other ground raised at the time of personal hearing." 3. On behalf of the Revenue, it has been vehemently argued that the CIT(A) has wrongly interfered in the findings of the Assessing Officer qua disallowance of assessee's claim under section 80IB of the "Act". In support of the arguments, the DR has also reiterated the submission raised in the grounds and prayed for acceptance of the appeal. 4. Opposing the Revenue, the assessee has contended that the CIT(A) has rightly held that the assessee's claim under section 80IB is liable to be accepted. In addition to this, the AR representing the assessee has argued that so far as the CIT(A) order qua disallowance under section 14A is concerned, the same has wrongly confirmed the findings of the Assessing Officer. 5. In rebuttal, the Revenue argues on the one hand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A) has held as under: "(i) From the above provisions. it is clear that claiming the deductions, one has to fulfil the requirements laid down in subsection (2) of Section 80-IB of the Act. Once the said conditions laid down in the sub-section (2) are fulfilled the asses sees are eligible for deduction under various sub-sections(3) to (11B) of Sec.801B of the Act, based on the activities carried out by them. (ii) Once the industrial undertaking is located in an industrially backward State, all units (whether SSI or non-SS I) are equally eligible for deduction u/s 80lB of the Act. (iii) Thus, the assessees whose industrial undertakings are recognised as "Small Scale Industries" or "located in an industrially backward State" are eligible for deduction u/s 80-1 B of the Act, even if they manufacture "article or thing specified in the list in the Eleventh Schedule". (iv) Once, the industrial undertaking is located in an industrially backward State, the assessee is eligible for deduction u/s 80IB(4) of the Act. In such a situation, there is no need to fulfil the requirements of "SSI" nature. If the assessee wants to claim deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wing conditions, namely :- (i) it is not formed by splitting up, or the reconstruction, of a business already in existence : Provided that this condition shall not apply in respect of an industrial undertaking which is formed as a result of the re-establishment, reconstruction or revival by the assessee of the business of any such industrial undertaking as is referred to in section 33B, in the circumstances and within the period specified in that section; (ii) it is not formed by the transfer to a new business of machinery or plant previously used for any purpose; (iii) it manufactures or produces any article or thing, not being any article or thing specified in the list in the Eleventh Schedule, or operates one or more cold storage plant or plants, in any part of India : Provided that the condition in this clause shall, in relation to a small scale industrial undertaking or an industrial undertaking referred to in sub-section (4) shall apply as if the words "not being any article or thing specified in the list in the Eleventh Schedule" had been omitted. &nbs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... day of March, 1995 or such further period as the Central Government may, by notification in the Official Gazette, specify with reference to any particular undertaking; (ii) where it is an industrial undertaking being a small scale industrial undertaking, it begins to manufacture or produce articles or things or to operate its cold storage plant [not specified in sub-section (4) or subsection (5)] at any time during the period beginning on the 1st day of April, 1995 and ending on the 31st day of March, [2002]. (4) The amount of deduction in the case of an industrial undertaking in an industrially backward State specified in the Eighth Schedule shall be hundred per cent of the profits and gains derived from such industrial undertaking for five assessment years beginning with the initial assessment year and thereafter twenty-five per cent (or thirty per cent where the assessee is a company) of the profits and gains derived from such industrial undertaking : Provided that the total period of deduction does not exceed ten consecutive assessment years (or twelve consecutive assessment years where the assessee is a co-operative society) subject t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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