9911796707
TMI Blog2024 (11) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... the Paper unit HELD THAT:- AO has resorted to value the steam based on the Director s Report annexed to the financial statements, wherein the average cost of various raw materials i.e., husk, fire wood, saw dust, chipper dust was disclosed. AO proceeded to compute the average cost based on these disclosures and arrived at a cost of Rs. 1200/- per ton of fuel consumption for the purpose of generation of steam. The main contention of AR is that as per the Companies Act, 1956 only material cost for the power consumption is disclosed in the Directors Report annexed to the financial statements whereas the stores and spares and other overheads consumed in the process of generation of steam are not disclosed. There is merit in the argument of AR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeals are being clubbed and a consolidated order being passed. We now take up the appeal in ITA No. 195/VIZ/2024 for the A.Y.2010-11 as a lead appeal. ITA No. 195/VIZ/2023 (A.Y. 2010-11) 2. This appeal is filed by the assessee against order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter in short Ld.CIT(A) ] vide DIN Order No. ITBA/NFAC/S/250/2023-24/1052801702(1) dated 12.05.2023 for the A.Y.2010-11 arising out of order passed under section 143(3) of the Income Tax Act, 1961 (in short Act ) dated 28.03.2013. 3. Brief facts of the case are that, assessee is a Company engaged in the manufacture of paper besides running a captive power plant and filed its return of income for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal. 5. Aggrieved by the order of the Ld. CIT(A), assessee is in appeal before us by raising following grounds of appeal: - 1. The order of the learned Commissioner of Income Tax (Appeals) is contrary to the facts and also the law applicable to the facts of the case. 2. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs. 61,19,772 made by the assessing officer by partly disallowing the deduction claimed u/s 80IA of the Act. 3. The learned Commissioner of Income Tax (Appeals) is not justified in sustaining the addition of Rs. 3,34,242 made by the assessing officer u/s.40A(7) of the Act towards disallowance of outstanding gratuity. 4. The learned Commissioner of Income Tax (Appeals) is not j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onverted into low pressure steam which is being sent to the paper unit for drying of the paper. He further explained that therefore the cost of steam is being valued on the basis of average cost of fuel for the generation of such steam and accordingly arrived at Rs. 3,19,33,875/-. The Assessing Officer required the assessee to submit the cost of husk, chipper dust, fire wood, saw dust and coal which was used as the raw material for the generation of steam which was produced before the Assessing Officer. Ld.AR further submitted that Assessing Officer being not satisfactory with the vouchers, proceeded to arrive at the steam cost based on the Directors Report annexed to the financial statements for the impugned assessment year. He therefore a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We have heard both the sides and perused the material available on record. The case of the Assessing Officer is that the assessee has claimed deduction under section 80IA of the Act with respect to the steam cost supplied to the paper unit by considering it as income in the books of the account of the assessee, thereby enhancing the profit of the power plant which is eligible for deduction under section 80IA of the Act and claiming the same as cost in the hands of the Paper unit. However, the only contention of the Ld.AR is with respect to the valuation of the steam adopted by the assessee. The Assessing Officer has resorted to value the steam based on the Director s Report annexed to the financial statements, wherein the average cost of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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