9911796707
TMI Blog1998 (6) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case, the Tribunal was right in law in holding that the assessee is entitled to relief under sections 80HH and 80J in respect of bus body building activities as there was no material brought on record to show that the conditions of sections 80HH(2)(ii) and section 80J(4)(ii) were not fulfilled by the assessee ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in rejecting the ground raised by the Department that the conditions laid down in section 80HH(2)(ii) and section 80J(4)(ii) were not fulfilled by the assessee on the ground that the same did not arise out of any finding by the Departmental authorities ?" The assessee is a public limited company doing business in tyre retreading, engine re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... body building, the assessee would be entitled to relief under sections 80J and 80HH of the Act on proportionate profits attributable to such activity, which could be arrived at on an estimate basis. The Department has challenged the order of the Commissioner of Income-tax (Appeals) before the Income-tax Appellate Tribunal. The grounds raised by the Revenue before the Tribunal was that the assessee did not satisfy the conditions laid down in section 80HH(2)(iii) and section 80J(4)(ii) of the Act and, therefore, the assessee was not eligible for deduction under both the sections. The case of the Revenue was that the assessee started the unit with old machinery and, therefore, the unit did not satisfy the conditions mentioned in both the se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 80HH of the Act, and the Tribunal was not justified in refusing to entertain the claim of the Revenue. We have carefully considered the submissions of learned counsel for the Revenue. It is, no doubt, true that the Inspecting Assistant Commissioner rejected the claim of the assessee by holding that the assessee was not entitled to the deduction both under section 80J and section 80HH of the Act on the ground that the assessee was not maintaining separate books of account in respect of the bus body building activities. The order of the Inspecting Assistant Commissioner proceeds on the basis that the assessee was not eligible for deduction under sections 80J and 80HH of the Act for the lapse on the part of the assessee in maintaining separ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Revenue in respect of its plea that the assessee had not fulfilled the requirements found in sections 80HH and 80J of the Act and in the absence of any material before the Tribunal, the Tribunal bid exercised its discretion not to entertain the new plea put forward by the Revenue before the Tribunal. We are of the opinion that it cannot be said that the Tribunal had exercised the discretion arbitrarily or unreasonably and on finding that there are no materials produced by the Revenue to support its plea, the Tribunal had exercised its discretion not to entertain the new plea. We are of the view that it is a case of exercise of the discretion of the Appellate Tribunal to entertain the new plea raised by the Revenue, and this court sitt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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