COMMISSIONER OF INCOME TAX-V vs. AREEZ P KHAMBHATA

TAXAP/78/2012 1/3 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL No. 78 of 2012 With TAX APPEAL No. 79 of 2012 For Approval and Signature: HONOURABLE MR.JUSTICE V. M. SAHAI

HONOURABLE MR.JUSTICE N.V. ANJARIA ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment? No 2 To be referred to the Reporter or not? No 3 Whether their Lordships wish  to see the  fair copy of the judgment? No 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder? No 5 Whether it is to be circulated to the civil judge? No ========================================================= COMMISSIONER OF INCOME TAX-V Versus AREEZ P KHAMBHATA ========================================================= Appearance : MRS MAUNA M BHATT for Appellant(s) : 1, None for Opponent(s) : 1, ========================================================= CORAM : HONOURABLE MR.JUSTICE V. M. SAHAI and HONOURABLE MR.JUSTICE N.V. ANJARIA Date : 09/08/2012 ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE V. M. SAHAI) We   have   heard   Mr.   M.   R.   Bhatt,   learned   senior   standing counsel assisted by Ms.Mauna Bhatt, learned counsel for appellant.

TAXAP/78/2012 2/3 JUDGMENT 2. This tax appeal has been filed on the following two proposed substantial questions of law. “[A]. Whether the Appellate Tribunal is right in law and on facts in allowing assessee deduction u/s 80IB of I.T. Act without considering that the conditions laid down u/s 80IB of I.T.Act have not been fulfilled? [B] Whether the Appellate Tribunal is right in law and on facts in allowing assessee deduction of salary amount of Rs.1,50,000/­ being not actually spent? [C] Whether the Appellate Tribunal is right in law and on facts in setting aside the view of AO that   in   view   of   sectioned   80AB   no   profit   from Industrial   undertaking   is   included   in   the   gross total income and hence such deduction would not be permissible?” 3. Under Section 80IB of the Income Tax Act if the assessee has ten or more workers then assessee is entitled to claim of deduction. The Assessing Officer came to the conclusion that the assessee was not having more than 10 workers. This finding recorded by the Assessing Officer has been reversed by the Commissioner of Income Tax (Appeal). After analyzing statement recorded by the Assessing Officer during the course of   survey and inspection report of the Factory Inspector on two accounts. In the inspection report of ESI Inspector, number of workmen and names of workmen engaged in the   unit   had   been   mentioned.   The   CIT   (Appeal)   came   to   the conclusion   that   the   Assessing   Officer   only   considered   workers engaged in one unit whereas the assessee had another washing unit having   same   activity.   Therefore,   the   workers   engaged   in   total

TAXAP/78/2012 3/3 JUDGMENT washing unit was also required to be considered while computing total   number   of   workers   employed   by   the   assessee.   The CIT(Appeal) also found that wages register, attendance register and inspection reports of ESI Inspector also supports the version of the assessee.   Therefore,   CIT(Appeals)   allowed   the   appeal   of   the assessee  for  the  Assessment   Year  2003­04   and  Assessment   Year 2006­07. The Appeal filed by the revenue has been dismissed by the Tribunal being agreed with the view taken by the CIT (A). 4. After hearing learned counsel for the Revenue, we do not find that   the   question   raised   by   the   Revenue   raises   any   substantial question of law. The appeals are concluded finding of fact and accordingly these Tax Appeal are dismissed. [V.  M. SAHAI, J.] [N. V. ANJARIA, J.] Amit