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TMI Blog1996 (5) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... g questions of law which arise from the order of the Tribunal for the opinion of this court : " (i) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is legally correct in applying its decision for the assessment year 1983-84 on the question of deduction under section 80-I of the Income-tax Act when the facts in the year under consideration are different from those in the assessment year 1983-84 ? (ii) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in allowing deduction under section 80-I as claimed by the assessee ignoring the fact that by manipulating the values of inter-unit transfers, the assessee had inflated the profits of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts, rounds, etc. 34,959 2764,01,249 7.90 The assessee maintained separate account books for each unit. The assessee claimed deduction under section 80-I at Rs. 31,84,420 as per details given below : Name of unit Gross income Deduction (i) Unit No. II 41,73,720 10,43,430 (ii) Industrial gases division 4,55,880 1,13,970 (iii) Special steel division (furnace 'S' and concast) 81,08,080 20,27,020 (iv) Special steel division (furnace 'T') Loss Nil ". During the course of assessment proceedings it was seen that the assessee has arranged the valuation of its inter-unit transfer in such a manner that more than 80 per cent. of the profits have been shown to accrue in the production of ingots/billets only and less than 20 per cent. of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... profession and as there was no income from the eligible business in which new machinery was installed, the assessee's claim under section 32AB was disallowed. Aggrieved against the order of the Assistant Commissioner of Income-tax, the assessee filed an appeal before the Commissioner of Income-tax (Appeals), Ludhiana, who vide its order dated January 15, 1991, allowed, as agreed to by the assessee, deduction under section 80-I at Rs. 26,64,937 as against Rs. 10,66,176 allowed by the Assessing Officer and Rs. 31,84,420 claimed by the assessee. The Commissioner of Income-tax (Appeals) further allowed deduction under section 32AB as claimed by the assessee holding that eligible business has to be seen as a whole and it does not mean the newl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ference application had been filed and that the matter had been decided on the basis of a formula accepted by the Revenue in the past. Question No. (iii) was declined by holding that the decision of the Tribunal was based on a correct interpretation of law. Counsel for the parties have been heard. In our considered view, the Tribunal has clearly erred in its approach. Simply because the Revenue did not claim reference for the earlier years would not debar the Revenue from claiming the reference if a question of law arises from the order of the Tribunal. The Revenue in the earlier years may not have claimed reference for a variety of reasons including that the tax effect for that year was very little. The question of law may be claimed for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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