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TMI Blog2016 (7) TMI 572X X X X Extracts X X X X X X X X Extracts X X X X ..... Shah, AR ORDER Per Rajpal Yadav, Judicial Member The present two appeals are directed at the instance of the Revenue against the orders of the ld.CIT(A)-V, Surat dated 27.1.2011 and 17.10.2011 passed in the Asstt.Year 2007-08 and 2008-09 respectively. 2. The grounds of appeal taken by the Revenue are not in consonance with the Rule 8 of the Income Tax (Appellate Tribunal) Rules, 1963 - they are descriptive and argumentative in nature. In brief the common grievance in both the assessment years is that the ld.CIT(A) has erred in setting aside the finding of the AO, rejecting the book of accounts under section 145(3) of the Income Tax Act, and thereby allowing deduction under section 80JJA of ₹ 2,06,02,468/- and ₹ 2,19,16,847/- for the Asstt.Years 2007-08 and 2008- 09 respectively. 3. Brief facts of the case are that the assessee is a partnership firm constituted with five partners. It has filed its return of income on 20.10.2007 and 30.9.2008 for the Asstt.Years 2007-08 and 2008-09 respectively. It has declared NIL income in both the assessment years after claiming deduction of ₹ 2,06,02,468/- and ₹ 1,29,16,846/- under section 80JJA of the In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... drawn in the first year itself, in subsequent year it cannot be denied. There is no distinguishing fact highlighted by the AO. The ld.DR, on the other hand, relied upon the orders of the AO passed in these years. 6. We have duly considered rival contentions and gone through the record carefully. We find that the ld.CIT(A) has recorded almost identical finding in both the years. For the facility of reference, we take note of the finding recorded by the ld.CIT(A) in the Asstt.Year 2007-08. It reads as under: Decision: 6. I have gone through the Assessment Order and the submissions of the appellant. The actions of the A.O. of rejecting the book results u/sec. 145(3) of the Income-tax Act and of rejecting the claim of assessee for deduction u/s. 80JJA of the Act cannot be upheld due to following reasons: (i) The A. O. in para 3.6 (C) has observed that: In view of the above discussion which shows that there are many discrepancies and defects in the books of accounts of the assessee which lead to the invoking of the provisions u/sec. 145(3) of the Income-tax Act. On the perusal of the details submitted and contra confirmations received which lead to the conclus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejecting the books of accounts and the book results cannot be approved and accordingly this ground of appeal is allowed. (ii) The assessee claimed deduction u/sec. 80JJA of the Income-tax Act. The A. O. has rejected the books of accounts u/sec. 145 (3) of the Income-tax Act. I do not understand how the rejection of books of accounts is linked the claim of deduction u/sec. 80JJA of the Act. The A. O. has rejected the assessee's claim for deduction u/sec. 80JJA Act holding that the assessee has not manufactured and sold organic manure which would enable the assessee to claim deduction u/sec. 80JJA of the Act. Reliance of the A.O. on the letter of SGS India Private Limited, Mumbai for rejection of claim of the assessee for deduction u/sec. 80JJA of the Act appears to be totally misconceived. In the said letter itself it is clearly stated that the product manufactured by the assessee can be approved as organic inputs for use in organic farming. Again while the A. 0. has rejected the claim for deduction u/sec. 80JJA of the Act, he has accepted the business profits shown by the assessee to be correct without pointing out as to if the assessee has not carried ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmission of the assessee given to the ld.AO in the set aside assessment proceeding of the asstt.year 2006-07. The relevant part of the submission of the assessee as well as finding of the AO reads as under: (D) Regarding claim of the deduction u/s. 80JJA of the I.T. Act- Regarding the claim of deduction u/s. 80JJA of the I.T. Act, assessee contended that the letter/certificate from the SGS India Pvt. Ltd has never been produced by it. Further, it was stated that the copies of annexure I and II of letter dated 21.12.2009 of SGS India Pvt. Ltd have not been provided. The assessee furnished a copy of letter dated 26.07.2006 of SGS India Pvt. Ltd to prove that it manufacture organic input for utilizing it for organic farming which is the prime intention of legislature for the claim of deduction u/s. 80JJA of the I.T. Act. During the assessment proceedings, a notice u/s. 133(6) of the I.T.Act has been issued on SGS India Pvt. Ltd., Mumbai. The SGS India Pvt. Ltd. is a company which issues certificates to the manufacturers of organic fertilizers. On going through the details received from SGS India Pvt. Ltd, it is seen that the certificate was issued to assessee for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on but to cancel the certificate issued, with immediate affect. As stated earlier, please return the original certificate issued by SGS India and arrange to withdraw the products that contain either SGS Organic Logo or India Organic Logo. In event of failing action from your end, the case will be referred to the competent authority. - In case you have any concerns on the same please do revert back to us. The above reproduced letter addressed to Mr. Pravin D. Mangukiya, partner of assessee firm is nothing but the annexure-II, which was not provided to assessee. The contents of the letter dated 21.12.2009 of SGS India Pvt. Ltd given to the assessee, itself explains that the annexure-I and II are issued on assessee by the SGS India Pvt.Ltd. and same was available with assessee and therefore not provided. Further, despite of warnings vide letters dated 25.07.2006 and 21.03.2007 from the SGS India Pvt. Ltd, assessee has not taken care of the same and has not surrendered certificate which shows that assessee has followed the norms. Therefore, in view of the above discussion, since assessee has not carried out its activities in accordance with the requirements of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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