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TMI Blog2011 (6) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... as under:- "1. The ld. CIT(A) has erred both in law and on facts of the case in holding that the income for ₹ 11,53,922/- and ₹ 1,17,180/- from 'Sale of Raddi' and 'Printing got done from outside' respectively form part of 'Eligible Profit' on which deduction u/s.80IC is allowable to the assessee." 3. Briefly stated, the facts of the case are that the assessee derives income from printing, publishing and sale of books. The total turnover shown by the assessee is ₹ 13,92,23,831/-, which comprises of the following income:- a) Interest Received : ₹ 4,427.00 b) Printing Income : ₹ 2,78,73,370.00 c) Sale of Books : ₹ 9,85,88,875.00 d) Sale of Raddi : ₹ 11,53,922.00 e) Sale of Paper: ₹ 2,578.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the industrial undertaking. They have noted the judgment of Hon'ble Supreme Court in the case of Pandian Chemicals Ltd. 262 ITR 278 (SC) in which it was held that the words "derived from" in section 80HH of the I.T.Act must be understood as something which has a direct or immediate nexus with the assessee's industrial undertaking. 2.3 In the case of Sundaram Inds. Ltd. (supra) the Hon'ble High Court held that deduction u/s.80HH in respect of misc. income derived from sale of scrap would be eligible for deduction u/s.80HH of the Act. They followed the decision in the case of Fenner (India) Ltd. 241 ITR 803 (Mad) in which scrap material had the saleable value and which was a bye product of the manufacture of other rubber articles was income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ws purchase of consumables, fuel and oil, wages and other manufacturing expenses totaling R.6.95 cores which includes printing outside of ₹ 1.17 lacs. In my opinion, just because the assessee has got a small portion of its printing work done from outside, it should not be disentitled to deduction u/s.80IC in respect of such amount. The disallowance made by the appellant in is respect of, therefore, directed to be deleted." 5. We have heard the rival parties and have also perused the material available on record. Shri Tarsem Lal, the learned D.R. heavily relied upon the order of the A.O. and on the other hand, Shri Prem Singh, Advocate, the learned counsel for the assessee submitted that sale the sale of Raddi actually in the real sen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s issue, the learned CIT(A) has correctly observed that the assessee has got a small portion of its printing work done from outside, it should not be disentitled to deduction u/s.80-IC of the Act in respect of such amount. While holding so, we are fortified by the decision of the Hon'ble Calcutta High Court in the case of CIT(Central), Calcutta Vs. W.H. Harton and Co. Ltd.(1978) 113 ITR 708 (Cal), wherein it has been held that a publisher got its books printed outside from any printer under its supervision and it can be said that the assessee had taken an active role by coordinating its activities as well as activities of the printer in a business like a manner. Considering the entire facts and the circumstances of the case, we uphold the o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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