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TMI Blog2015 (11) TMI 1268X X X X Extracts X X X X X X X X Extracts X X X X ..... scharged on the issue of quantum of exemption. The order of the First Appellate Authority, in our view is not well reasoned. The order has not given any reason as to why the A.O. was wrong on each of his conclusions. We set aside the matter to the file of the Ld.CIT(A) with a direction to pass a speaking and reasoned order on each of the observations of the Ld.A.O. - Decided in favour of revenue for statistical purposes. - ITA No. 4504/Del/2012 - - - Dated:- 11-9-2015 - I. C. Sudhir, JM And J. Sudhakar Reddy, AM For the Petitioner : Shri Vikram Sahay, Sr DR For the Respondent : Shri V K Jain, CA ORDER Per J. Sudhakar Reddy, Accountant Member This is an appeal filed by the Revenue and is directed against the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axable income of the appellant. 2.2. In view of the above findings, the Assessing Officer allowed the deduction at 50% of the profits of M/s. M.J. Pacing at ₹ 65,21,971/- in respect of the claim of deduction u/s.80IC wvith regard to the deduction u/s.80IC in respect of profits of M/s. M.J.Industries, the Assessing Officer observed that the issue of machinery used by the appellant (with reference to the conditions laid down in clause (ii) of sub section (4) of section 80 IC was examined in detail in the assessment year 2006-07, and it was found that the value of old machinery was more than 20% of the total value of the machinery used. Thus, the appellant was held to be ineligible for claim of deduction u/s.80lC in respect of profits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is wrong to encourage or entertain the belief that it is a honorable to device payment of taxes by resorting to dubious method. 2. Whether Ld. CIT (A) was justified in allowing the disallowance of deduction u/s 80IC in respect of unit M/s MJ. Industries, which was disallowed by the Ld.AO on the basis of decision of AO passed u/s 143(3) LT. Act, 1961 for A.Y. 2006-07, in the assessee's own case on the same issue for which revenue appeal is pending before the ITAT. 3. The appellant craves leave to add, alter or amend any/all the grounds of appeal before or during the course of hearing of the appeal . 5. We have heard Shri Vikram Sahay, the Ld.Sr.D.R. on behalf of the Revenue and Shri VK Jain, the Ld.Counsel for the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e for sister concerns, which have shown heavy losses. (iv) M/s MJ Packaging has got plant machinery, the written down value of which is only ₹ 14,10,631/-, as on 1.4.2007. The assessee HUF has shown rental income of ₹ 3 lakhs from Plot no.59, HBSIDC, Baddi, which shows that, the assessee has let out this plot on rent. Hence these two proprietary concerns claim that they are located and functioning from this plot is false. (v) In the case of M/s MJ Industries , manufacturing receipts of ₹ 78.20 lakhs have been shown in the current year. The net profit was ₹ 61.36 lakhs, which is 78.46% of the gross receipts of manufacture. (vi) The written down value of M/s MJ Industries as on 1.4.2007 is nil EPF co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s M.J.. Global Ltd. 277.28 239.23 (-)156.82 LOSS (-)245.82 LOSS (-) 56 (-)102 M/s M.J.. Packaging, Plot No.59, HPSIDC. 308.45 353.75 130 PROFIT 197.24 PROFIT 42.2 55.8 Baddi, HP M/s M.J. Industries, Plot-59,HPSIDC. Baddi, HP 78.20 127.59 61.36 PROFIT 89.43 PROFIT 78.5 70.1 (viii) The argument of the assessee that the net profit is high because the management has made all ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. It is well settled that when the assessee claims an exemption, burden lies on it, to prove that he is entitled to exemption. In this case the burden has not been discharged on the issue of quantum of exemption. 9.1. S.80 IA(10) reads as follows. S.80(IA) (10) Where it appears to the Assessing Officer that, owing to the close connection between the assessee carrying on the eligible business to which this section applies and any other person, or for any other reason, the course of business between them is so arranged that the business transacted between them produces to the assessee more than the ordinary profits which might be expected to arise in such eligible business, the Assessing Officer shall, in computing the profits an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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