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TMI Blog2021 (11) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the activity are eligible for deduction u/s 80P - some of the activity of the assessee are taxable. But the assessee is maintaining common books of accounts, common infrastructure, common facilities, manpower etc. Thus in such a situation, the only option available to the assessee is to apportion the expenses to different activities for determining the net profit of each activity. Accordingly, we are not convinced with the finding of the authorities below by treating the gross profit as taxable income of the assessee. It was the duty of the revenue to pinpoint the infirmity in the expenses apportion by the assessee towards the activity under consideration. To our understanding, all the expenses apportion by the assessee cannot be ig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered u/s 80P(2)(c). Hence, we set aside the finding of the learned CIT (A) and direct the AO to allow the deduction to the assessee under the provisions of section under section 80P(2)(c)(ii) of the Act. Hence the ground of appeal of the assessee is allowed. - ITA No. 224/AHD/2019 - - - Dated:- 28-10-2021 - Shri Rajpal Yadav, Vice President And Shri Waseem Ahmed, Accountant Member For the Assessee : Shri M.M. Salvi, A.R For the Revenue : Shri Purushottam Kumar, Sr.D.R ORDER PER WASEEM AHMED, ACCOUNTANT MEMBER: The captioned appeal has been filed at the instance of the Assessee against the order of the Learned Commissioner of Income Tax(Appeals), Gandhinagar, dated 11/12/2018 arising in the matter of assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount of ₹ 17,028/- which is not eligible for deduction under section 80P of the Act. The assessee against the sale of Ghee has claimed only purchase expenses and has shown gross profit of ₹ 48,830/- only. The assessee against such gross profit has appropriated certain expenses and offered the net profit to tax for ₹ 17,028/- only. However, the assessee during the assessment proceedings cannot point out the specific indirect expenses incurred for the activity of sale of Ghee. Therefore the AO has treated the entire amount of ₹ 48,830/- representing the gross profit as income of the assessee. 4. Aggrieved assessee preferred an appeal to the learned CIT (A). 4.1 The assessee before the learned CIT (A) submitted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions. These expenses may include the audit expenses, staff expenses, electricity expenses etc. In other words, it is not possible for any organization to run its activities without incurring the basic expenditures. Likewise, the assessee among other activity, is also carrying out the activity of trading in Ghee which is not possible to run without incurring the administrative expenses. The assessee is engaged in multiple activity and some of the activity are eligible for deduction under section 80P of the Act. At the same time some of the activity of the assessee are taxable. But the assessee is maintaining common books of accounts, common infrastructure, common facilities, manpower etc. Thus in such a situation, the only option available ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. 11. Aggrieved assessee preferred an appeal to the learned CIT (A). 11.1 The assessee before the learned CIT (A) submitted that it is engaged in various activities of purchase and sale of milk, Sagar dan, Sagar Ghee under cooperative sector. These activities entitle the assessee to claimed the deduction under section under section 80P(2)(c)(ii) of the Act for ₹ 50,000/-. 11.2 However, the learned CIT (A) observed that the activity of the assessee falls under clause (b), therefore the assessee cannot claim the deduction under section 80P(2)(c)(ii) of the Act. Thus the ground of appeal of the assessee was dismissed. 12. Being aggrieved by the order of the learned CIT (A), the assessee is in appeal before us. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - as provided for in section 80P(2)(c)(ii) must be granted. 15.2 It appears that, though the word 'activity' is not defined, yet the investment activity, activity of renting of immovable property, trading of Ghee etc., and the consequent income attributable to such activities would be covered under section 80P(2)(c). Hence, we set aside the finding of the learned CIT (A) and direct the AO to allow the deduction to the assessee for ₹ 50,000/- under the provisions of section under section 80P(2)(c)(ii) of the Act. Hence the ground of appeal of the assessee is allowed. 16. In the result the appeal filed by the assessee is allowed. Order pronounced in the Court on 28/10/2021 at Ahmedabad. - - TaxTMI - TMITax - Income ..... X X X X Extracts X X X X X X X X Extracts X X X X
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