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TMI Blog2015 (10) TMI 250X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has filed Form No.10CCB on the last date of hearing due to which AO could not have verified the same to appreciate the correctness of the claim. As regards the third objection, we find that the CIT (A) has relied on section 80IA(10) dealing with similar provisions as section 80IAB to hold that the AO in computing the profit and gains of the eligible business for the purpose of the deductions u/s 80IA, can take the amounts of profit as may be reasonably deemed to have been derived therefrom. Thus, it is clear that even if the assessee is not maintaining separate books of accounts for eligible units, the AO shall compute the deduction on a reasonable basis provided the business transacted between eligible business and any other person produces to the assessee more than the ordinary profits which might be expected to arise in such eligible business. In the case before us, the CIT (A) has simply applied the said provision without examining whether the assessee satisfies the conditions prescribed thereunder. Therefore, for verification as to whether the assessee satisfied the conditions u/s 80IA(10) of the Act and for computation of deduction u/s 80IAB of the Act, we deem it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings u/s 143(3) were initiated and notice u/s 143(2) was issued and served on the assessee on 3.8.2010. During the pendency of the scrutiny assessment proceedings, assessee filed a revised return of income in physical mode on 30.05.2011 admitting the taxable income of ₹ 16,36,73,160. AO observed that the revised return was filed beyond the time permitted and therefore, is legally invalid. However, since the assessee disclosed higher income as per the revised computation, he considered it for the purpose of determination of the taxable income. AO observed that in the revised return, assessee has claimed deduction of ₹ 53,88,807 u/s 80IAB of the Act towards income from notified SEZ. He observed that assessee has not made the claim u/s 80IAB in the original return of income. He also observed that the assessee has filed Form 10CCB in support of claim u/s 80IAB only on the last date of hearing. Observing that the assessee has failed to furnish the P L a/c and balance sheet of the respective units eligible for the claim u/s 80IAB, he observed that it is not possible to determine the eligible profit. Therefore, he disallowed the deduction by relying upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed provisions of section 40(a)(ia) of the Act to the facts of the case, even though such provision was applicable prospectively and was not applicable to the year before us. He submitted that the CIT (A) ought not to have considered that NTPC has offered the interest income and therefore, ought not to have held that the disallowance u/s 40(a)(ia) is not to be made in the hands of the assessee. 4. The ld Counsel for the assessee, on the other hand, supported the order of the CIT (A) and submitted that as regards deduction u/s 80IAB is concerned, it is true that the assessee did not make any claim u/s 80IAB in its original return of income, but the assessee had made the claim in its revised return filed on 30.05.2011. He submitted that filing of Form No.10CCB alongwith the return of income was only a technical requirement and the assessee had filed the same before the AO though on the last date of hearing. He submitted that inspite of observing that it was a belated return, by taking into account the taxable income returned in the revised return of income, AO has accepted the same and therefore, it was a valid return. Therefore, according to him, the AO was wrong in saying that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of profit as may be reasonably deemed to have been derived therefrom. Thus, it is clear that even if the assessee is not maintaining separate books of accounts for eligible units, the AO shall compute the deduction on a reasonable basis provided the business transacted between eligible business and any other person produces to the assessee more than the ordinary profits which might be expected to arise in such eligible business. In the case before us, the CIT (A) has simply applied the said provision without examining whether the assessee satisfies the conditions prescribed thereunder. Therefore, though we agree with the order of the CIT (A) that the assessee s claim u/s 80IAB needs to be considered, we find that the CIT (A) has not considered the correctness of the claim of the assessee u/s 80IAB of the Act. Therefore, for verification as to whether the assessee satisfied the conditions u/s 80IA(10) of the Act and for computation of deduction u/s 80IAB of the Act, we deem it fit and proper to remand the issue to the file of the AO. This ground of the appeal is treated as allowed for statistical purposes. 8. As regards the deletion of disallowance of the interest paid to NTPC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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