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TMI Blog2022 (5) TMI 541X X X X Extracts X X X X X X X X Extracts X X X X ..... e time of scrutiny assessment is not tenable and accordingly cannot be sustained Interest earned by the assessee from late payment from the sundry debtors and VAT remission shown as miscellaneous income are not the part of the eligible profit u/s 80IE and therefore deduction u/s 80IE has been allowed in excess resulting into the mistake in the assessment order which has caused prejudice to the revenue - We find that the same is arising from business activity of the assessee and has been treated as part of the profit for the purpose of deduction u/s 80IE of the Act as the interest earned from the sundry debtors who has not made the payment during the credit period allowed them. Similarly the VAT remission is also part of and arising bec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER PER SHRI RAJESH KUMAR, AM: This is an appeal preferred by the assessee against the order of the Principle Commissioner of Income Tax-1, Kolkata [hereinafter referred to as PCIT ] passed u/s 263 of the Income Tax Act, 1961 (hereinafter referred to as the Act) dated 23.03.2018 for the assessment year 2013-14. 2. The assessee has raised following grounds of appeal: 1. That the Ld. PCIT-1, Kolkata s order u/s 263 of the Act dated 23.03.2018 is ab-initio void and bad in law and on facts. 2. That the Ld. PCIT has erred in law in initiating the proceedings u/s 263 of the Act without her own discretion, satisfaction and judgment but on the basis of audit objections and as such, the order u/s 263 of the Act passed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed before the Bench the PCIT records and it was examined by the Bench along with dispatch register and found that the plea taken by the ld. Counsel of the assessee has no merit as this was mere a mistake which does not go to the root of the matter and is of clerical nature. Accordingly, ground nos. 1 and 2 are dismissed. 6. The issue raised in ground no. 3 is against the order passed u/s 263 of the Act setting aside the assessment framed u/s 143(3) of the Act dated 25.03.2016 by wrongly upholding the said order is erroneous and prejudicial to the interest of the revenue. 7. The facts in brief are that the assessment in this case was framed u/s 143(3) of the Act vide order dated 25.03.2016 assessing the total income at Rs. 24,84,01,880 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls of miscellaneous expenses a copy of which is placed at page no. 177 of PB. The Ld. A.R. therefore submitted that issue has been raised by the AO and examined during the assessment proceedings and only after examination a plausible view was taken. The ld Counsel of the assessee submitted that the assumption of revisionary jurisdiction on this point is invalid and against the provisions of law as the PCIT has no authority to intervene and disturb the assessment which has been framed after examination/enquiry of evidences filed by the assessee in response to notice issued u/s 142(1) of the Act during the assessment proceedings. On the second issue the Ld. A.R. submitted that the other income comprised of two constituents: i) interest income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of Hon ble Apex Court in the case of CIT vs. Meghalaya Steels Ltd. reported in [2016] 67 taxmann.com 158 (SC) wherein it has been held that the transport subsidy, interest subsidy, power subsidy and insurance subsidy are part of the income derived from business as there was certainly direct nexus of profits of assessee s business and reimbursement of such subsidies. The Ld. A.R. submitted that the similarly applying the same analogy in the present context the remission which is a kind of incentive to the assessee arising from the said Industrial unit by virtue of its manufacturing activity carried on in the backward area is certainly a part of the eligible profit u/s 80IE of the act and thus the finding of the PCIT that there should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proceedings by issuing notice u/s 142(1) dated 25.06.2015 which was replied by the assessee by submitting complete and comprehensive details of miscellaneous expenses which contained CSR expenses also. The copy of reply is filed at page no. 169 to 198 of PB. On the basis of this, we are of the view that the AO has examined the issue and has taken a plausible view and therefore the conclusion of PCIT that issue has not been examined by the AO at the time of scrutiny assessment is not tenable and accordingly cannot be sustained. So far as the issue of interest from sundry debtors is concerned, we find that the same is arising from business activity of the assessee and has been treated as part of the profit for the purpose of deduction u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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