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TMI Blog2024 (1) TMI 559X X X X Extracts X X X X X X X X Extracts X X X X ..... lant/revenue has sought condonation of delay of 245 days in re-filing the appeal No. ITA 157/2023 after curing the defects raised by the Registry of this court. The delay is explained largely on account of collation of relevant records. There being no serious objection, the application is allowed and accordingly the delay in refiling the appeal is condoned. 1. These two appeals between same parties are based on similar factual and legal matrix, so taken up together for disposal. The appeal bearing ITA No. 1021/2019 pertains to the Assessment Year 2011-12 while the other appeal bearing ITA No. 157/2023 pertains to the Assessment Year 2012-13. Both these appeals brought by revenue under Section 260A of the Income Tax Act seek to assail order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turned a finding of fact that the assessee sold books to its holding company i.e., S.Chand Co. Ltd., albeit, at a discount. 4. The Tribunal has also noted that the discount offered by the respondent/assessee was in the nature of trade discount and not commission. 5. Clearly, given this finding of fact, the respondent/assessee, as correctly ruled by the Tribunal, was not required to deduct tax at source under Section 194H of the Income Tax Act, 1961 [in short, "the Act"]. Therefore, the conclusion arrived at by the Tribunal, which is also the view taken by the CIT(A), is that the disallowance under Section 40(a)(ia) of the Act could not be sustained. 6. We may note that this view has been accepted by the Supreme Court in Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tial year in which the petitioner had claimed the benefit under the provisions of Section 80IC of the Act. 4.1. Mr Bhatia affirms the position that the AO had in fact allowed the deduction. However, it is Mr Bhatia's contention that new facts had been found in the succeeding AY i.e., AY 2011-12. 4.2 It is also Mr Bhatia's contention that in the initial AY i.e., AY 2010-11, the return of the respondent/assessee has been processed under Section 143(1) of the Act. 5. We have perused the impugned order. Prima facie, according to us, the facts found by the Tribunal in AY 2011-12 do not appear to have undergone a change. Therefore, the AO's view that deduction should be denied under Section 80IC of the Act, seems to be untenable. 5.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nding etc. and no manufacturing activity had actually taken place in the Rudrapur premises, therefore, the deduction of Rs. 7,28,63,013/- under Section 80IC of the Act could not be allowed. Further, pertaining to the Assessment Year 2011-12, the Assessing Officer also made an addition of Rs. 6,04,45,025/- under Section 40(a)(ia) of the Act on account of trade discount offered by the respondent/assessee to the buyer M/s S. Chand & Co. holding that the said discount was in the nature of commission on which tax deductable at source (TDS) under Section 194H of the Act was not deducted by the respondent/assessee. 3.3 As regards the deduction under Section 80IC of the Act claimed by the respondent/assessee for the Assessment Year 2012-13, the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scount and not in the nature of commission, so there was no necessity to deduct TDS under Section 194H of the Act and as such, addition under Section 40(a)(ia) of the Act was not sustainable. 3.5 The appeals filed by the appellant/revenue pertaining to both assessment years were dismissed by the Tribunal by way of the orders, impugned in the present two appeals. 4. As mentioned above, these appeals revolve around two common issues, namely the deduction claimed by the respondent/assessee under Section 80IC of the Act and the addition made by the Assessing Officer under Section 40(a)(ia) of the Act. As also mentioned above, the issue under Section 40(a)(ia) of the Act stands already covered in favour of the respondent/assessee by way of jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking of the respondent/assessee at Rudrapur, and there being no manufacturing activity, the respondent/assessee is not entitled to the deduction under Section 80IC of the Act. On the other hand, according to the respondent/assessee, as also held in the impugned orders, the process of printing and binding of books is certainly carried out in the eligible undertaking of the respondent/assessee at Rudrapur. 7. The question as to whether the exercise of printing and binding of books is carried out at the eligible undertaking of the respondent/assessee is a question of fact, on which findings of CIT(A) in favour of the respondent/assessee were confirmed by the Tribunal. 7.1 The relevant findings delivered by CIT(A) are extracted as follows: ..... X X X X Extracts X X X X X X X X Extracts X X X X
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