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TMI Blog1981 (11) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... account, but the bonus was claimed as business expenditure. So, the ITO held that the bonus payment did not form a charge against the assessee's business income. Hence, he disallowed the sum of Rs. 910. 4. In appeal, the CIT (Appeals) found that similar ground of appeal had been decided by him vide his order dt. 22nd April, 1980 in No. CIT (A)/VII/CC-III/67/1976-77 for the asst. yr. 1972-73, in the assessee's own case, and for the reasons discussed in detail in that order, he held that the ITO's action was fully justified. Hence, no interference with his order, on the issue, was called for. 5. In appeal before us, Shri Mehta accepted the factual position stating that the earlier year's order was accepted by the assessee being meagre amount, and the principle of res judicata and estoppel is not applicable in the income-tax proceedings, and, as such, the claim of the assessee on the issue, would be allowed in the year under consideration. 6. We do not see any force in the contention of Shri Mehta, since the amount involved in this year is also small one, amounting to Rs. 910, and the facts of this year are identical with those of asst. yr. 1972-73, and the CIT (Appeals) foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purpose of the wealth-tax assessments of the share-holders goes unrebutted, and as such, the amount of Rs. 2,000 is not expended wholly and exclusively for the assessee's business. Accordingly, we confirmed the order of the CIT (Appeals), on the issue. Moreover, the stand of the assessee for the claim are different before the authorities below and being so the stands on its failure to prove, hence the stand before us referred to above is after-thought and not substantiated. 12. The third ground in this appeal is that the CIT (Appeals) erred in disallowing cash of Rs. 18,849 embezzled by an employee of the company, on the ground that the same amount was in the nature of rent. 13. Shri Bashir Dawood, a peon of the assessee-company, embezzled the amount and the FIR was lodged on 5th June, 1975 in the Police. The ITO rejected the claim of the assessee on the ground that the claim of the assessee did not fall in the previous year; relevant for the assessment year under consideration, as the assessee came to know of the embezzlement on 5th June 1975, which day is out of the previous year, which ended on 31st March, 1975; that it was not claimed as deduction in the original retu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see before the CIT (Appeals), while Shri Joy, ld. Deptl Rep. reiterated that of the CIT (Appeals), and relied on the orders of the authorities below. 16. We have heard the rival contentions and gone through the record before us. We are of the opinion that the assessee should also fail on this issue. Firstly, the claim of the assessee did not fall in the previous year; relevant for the assessment year under consideration, and, as such, the same cannot be allowed in the year under consideration. Secondly, the claim of the assessee is not at all allowable as it is an admitted position that the amount embezzled was the collection of rent, which was to be deposited in the Bank, and, as such, it had no nexus to the business of the assessee, particularly, when the assessee has not claimed it as such, in the original return. Moreover, the assessee filed an affidavit before the Police stating therein than the amount embezzled did not relate to its business activities; so mush so that it was not shown as such in the business accounts. Hence, it is manifestly clear that this plea is an after-thought. Apart from it, the CIT (Appeals) has assigned cogent and relevant reasons, for arriving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this respect also, the freezing that was done by the assessee was in respect of its catch of fish for preventing the same from deterioration before delivering it in the market; that it had not conduced any business of cold storage catering to others and in the circumstances, it could not be treated as a cold storage plant even. Thus, the ITO, in view of the facts and circumstances stated above, held that the assessee's business of fishing with trawler was not industrial undertaking; it was not running the business of shipping; it was not conducting the business of cold storage and it was not a processing unit to be treated as an industrial undertaking for the purpose of s. 80J of the Act. He, therefore, rejected the claim of the assessee for relief under s. 80J of the Act. 19. In appeal also the assessee failed, as the CIT (Appeals) was of the view that the income -tax Officer had elaborately met all the arguments of the assessee in his order; that one of the basic conditions required to be satisfied for allowing relief under s. 80J of the Act was that the appellant should have an industrial undertaking, which manufactured or produced articles which condition was not at all sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heir Lordships of Bombay High Court answered this question referred above in the negative. This shows that there was no issue before their Lordships of the Hon'ble Bombay High Court that whether the business of the assessee which is catching fish and selling the fishes after processing is an industrial undertaking, and as such, relief under s. 80J is allowable or not. Since this issue was not there before their Lordships and as such, they had no occasion to decide it. However, this issue was there before Their Lordships of the Hon'ble Kerala High Court in the case in Cochin Company vs. CIT 1975 CTR (Ker) 104: (1978) 144 ITR 822 (Ker) where Their Lordships categorically held that the business of fishing and selling these after processing is nothing else than an industrial under-taking. The facts of this case are identical with that of the case decided by the Hon'ble Kerala High Court. Therefore, following it with respect, we hold that the business of the assessee is an industrial undertaking and when this is so, then, it is entitled to relief under s. 80J of the Act, on the basis of industrial undertaking. Now, the question arises of the quantification of the relief, which has to b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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