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TMI Blog2015 (6) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... ng unit at Manpura (Baddi) Himachal Pradesh and branches at Ghaziabad and Patna. The head office is in New Delhi. The assessee claimed deduction u/s 80 IC on the profits and gains earned from its business income of its Manpura Unit. The issue before us is the computation of relief u/s 80 IC of the Act. 3. The First Appellate Authority has given the following factual findings. "The trading and profit & loss a/c of the Manpura unit was examined to verify the facts. Unit/Branch office Stock transferred in Unit/Branch from which transferred Stock transferred out Unit/Branch from which transferred Manpura (Baddi) Rs.18,15,009/- Delhi Rs.18,67,305/- Rs. 43,73,839/- Ghaziabad Delhi (H.O.) Delhi Rs.43,73,839/- Rs. 8,60,325/- Manpura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fans which are manufactured at Manpura are being transacted by the various branches and the head office. It is only at the Patna unit that no mutual transfer of goods has taken place during the year. These facts show that the entire profits of the Manpura unit are not attributable to manufacturing activity but is also partly derived from trading activity. Considering the above facts the AO decision of reducing the loss on patna unit from net profit of the manpura unit for computation of admissible deduction u/s 80IC is deleted. The decision of the AO of reducing loss in respect of Ghaziabad unit i.e. Rs. 1,46,591/- from the net profit of Manpura unit for computation of deduction u/s 80IC is thus confirmed." 5. Aggrieved the assessee is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt in form no.10 CCB certifying the claim of deduction u/s 80IC was filed along with the return of income. (iii) There is no discrepancy found or alleged on the inventory of the assessee. (iv) The books of accounts have been accepted and hence the profits disclosed therein cannot be interfered with by way of estimation etc. (v) The unit at Baddi had transferred the goods in question at cost. This fact that Baddi Unit had transferred the goods at cost was brought to the notice of the AO vide letter dt. 8.11.2010. Similar submissions were made vide submissions dt. 1.12.2011 before the Ld.CIT(A). The Ld.CIT(A) at para 5.7 page 7 reiterated the same. Under these circumstances there cannot be a hypothetical deduction of 1% of the profits for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is." 9.1. The Ld.CIT(A) in his order at para 5.1 page 7 recorded as follows. "5.1. Further, the ld.AR vide written submission dt. 1.12.2011 has argued as under: "During the AY 2008-09, the Baddi (Sales) unit has transferred the finished manufactured goods to Delhi Unit for Rs. 43,73,839.55 to Ghaziabad branch for Rs. 18,67,305.00. All the freight expenses to transfer the goods to its other units were borne by the Baddi unit itself and no expense of freight were borne by its other units which can be verified from the individual profit and loss account of its units. There is no expenditure incurred by Delhi unit which has made expenses against the trading sales of Rs. 20,92,52,796/-. The Ghaziabad branch has incurred Rs. 24,169/- on cartage ..... X X X X Extracts X X X X X X X X Extracts X X X X
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