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Income Tax Appellate Tribunal, “G” Bench, Mumbai
O R D E R Per Shamim Yahya (AM) :- This is in appeal by the Revenue is directed against order of learned CIT appeal dated 20.11.2018 and pertains to A.Y. 2010-11.
The grounds of appeal read as under :-
1. The CIT(A) has erred on facts and in law by allowing the deduction u/s 10B of the IT Act, 1961 after adjustment of losses of other units owned by the assessee? 2. It is submitted that since the re-computation of deduction u/s 10B was as per CBDT Circular No. 7/2013 dated 16.07.2013, the action of the Assessing officer falls within the preview ofSec.154 of the Act. "
2. The appellant craves leave to amend or alter any ground or add a new ground that may be necessary. 3. The Ld. CIT(A)'s order is contrary in law and on facts and deserves to be set aside.
In this case Assessing Officer passed an order under section 154 of the Income Tax Act. In this order he held that the assessee has been allowed deduction under section 10B of the act in the assessment order without adjustment of losses from other unit. Hence he made the adjustment of losses
2 M/s. Shaily Eng. Plastic Ltd. from other unit and thereafter computed the deduction under section 10B of the Act accordingly.
Against this order assessee appealed before the learned CIT(A).
Learned CIT(A) found that the decisions referred by the assessee in the case of CIT Vs. M/s. Yokogawa India Ltd. (Civil Appeal No. 8498 of 2013)(Supreme Court) was also in favour of the assessee on merits. Moreover he found that the issue is in any case debatable and an order under section 154 of the Act cannot be passed on the subject. We may gainfully referred to the order of learned CIT(A) in this regard as under :-
“I have considered the submission made by the assessee. It is observed that the AO has passed rectification order u/s. 154 of the Act and has allowed deduction u/s 10B of the IT Act to the appellant after adjustment of losses of other units owned by the appellant. The action of the AO is not in conformity with the decisions quoted by the appellant. Therefore, even if the AO has a case, the issue the decision quoted by the appellant. Therefore, even if the Assessing Officer has a case, the issue whether the decision under section 10B of the IT Act should be allowed in respect of a unit by considering the unit on a stand-alone basis or it should be allowed after adjustment of loss from other units is at best a debatable issue. Therefore, the rectification made by the AO in the order under 154 of the IT Act dated 23/03/2015 is beyond the scope of the provisions of section 154 of the IT Act. Accordingly, the order passed by the AO under section 154 of the IT Act is hereby quashed and set aside and the only ground of appeal raised by the appellant is allowed.
Against this order revenue is in appeal before us.
We have heard the learned departmental representative. None appeared on behalf of the assessee. Learned departmental representative could not controvert that the issue on merit itself is covered in favour of the assessee by the Supreme Court decision as above. Moreover as rightly pointed out by the learned CIT(A) this issue cannot be subject matter of order under section 154. As an order under section 154 can be passed only on a mistake apparent from record. By no stretch of imagination this issue can be said to be a mistake apparent from record.
3 M/s. Shaily Eng. Plastic Ltd.
Hence we do not find any infirmity in the order of learned CIT(A). Accordingly we uphold the same.
In the result this appeal by the revenue stands dismissed.
Pronounced in the open court on 6.4.2021.