RUSAN PHARMA LTD,MUMBAI vs. ADDL CIT 9(3), MUMBAI

O R D E R

Per ASHWANI TANEJA, AM:

“In the facts and circumstances of the case and in law, the learned CIT Appeals erred in confirming that income of Rs. 24,550/- on account of Sale of Scrap does not qualify for deduction u/s I0A/10B of the IT Act, 1961.

Reasons given by the CIT Appeals for confirming that income of Rs. 24,550/- on account of Sale of Scrap does not qualify for deduction u/s IOA/IOB of the IT Act, 1961 are wrong, insufficient and contrary to the facts and evidences on record

3 In the facts and circumstances of the case and in law, the learned CIT Appeals erred in confirming that amount of Rs. 11,21,155/- being sundry balances written off at Ankleshwar Unit & Kandla Unit does not qualify for deduction u/s IOA/IOB of the IT Act, 1961. 4 Reasons given by the CIT Appeals for confirming that amount of Rs. 11,21,155/- being sundry balances written off at Ankleshwar Unit & Kandla Unit does not qualify for deduction u/s IOA/IOB of the IT Act, 1961 are wrong, insufficient and contrary to the facts and evidences on record In the facts and circumstances of the case and in law, the learned CIT Appeals erred in confirming the disallowance of Rs. 14,78,358/- on account of Commission & Brokerage being the amount not qualifying for deduction u/s 10A/10B of the IT Act,1961.

7 In the facts and circumstances of the case and in law, the learned CIT Appeals erred in confirming the disallowance of Rs. 17,16,620/- on account of Exchange Variation Gain being the amount not qualifying for deduction u/s IOAI10B of the IT Act, 1961.

8 R e a s o n s g i v e n b y t h e C I T A p p e a l s f o r c o n f i r m i n g t h e disallowance of Rs. 17,16,620/- on account of Exchange Variation Gain being the amount not qualifying for deduction u/s IOA/10B of the IT Act,

1961, are wrong, insufficient and contrary to the facts and evidences on record

9 In the facts and circumstances of the case and in law, the learned CIT Appeals erred in confirming that income of Rs. 9,68,789/- on account of DEPB Incentive pertaining to Kandla Unit does not qualify for deduction u/s IOA/IOB of the IT Act, 1961. 10 Reasons given by the CIT Appeals for confirming that income of Rs. 9,68,789/- on account of DEPB Incentive pertaining to Kandla Unit does not qualify for deduction u/s IOA/IOB of the IT Act, 1961 are wrong, insufficient and contrary to the facts and evidences on record.

12 Reasons given by the CIT Appeals for confirming that income of Rs. 17,16.620/- on account of miscellaneous receipts pertaining to Kandla Unit does not qualify for deduction u/s IOA/IOB of the IT Act, 1961 are wrong, insufficient and contrary to the facts and evidences on record.”

4.1 Grounds 1 & 2 are not pressed by the assessee, therefore, these are dismissed.

4.2 Grounds, 3, 4, 5, 6 7 & 8 : With regard to these grounds, it was submitted by the Ld. Counsel that similar issues were involved in the earlier years wherein the Tribunal has sent these issues back to the file of the Assessing Officer with a direction to re-adjudicate the same as per the directions given by the Tribunal. Ld. DR did not raise any objection in this regard.

4.3 We have gone through the orders of the Tribunal for earlier years and find the argument of the Ld. Counsel to be correct. Accordingly, we send these grounds back to the file of the Assessing Officer for fresh adjudication after giving opportunity of hearing to the assessee. The Assessing Officer is directed to follow the aforesaid orders of the Tribunal in assessee’s own case for earlier years. These grounds may be treated as allowed for statistical purposes.

4.4 Grounds 9 & 10: In these grounds, the assessee has challenged the action of lower authorities in not granting the benefit of deduction u/s 10A/10B on the amount of DEPB incentive pertaining to Kandla unit. It was submitted that this issue was decided by the Tribunal for earlier years in favour of the assessee. The Ld. DR did not raise any objection in this regard. It is noted by us that the Tribunal in earlier years’ orders has decided this issue in favour of the assessee by relying upon the decision of the Hon’ble Bombay High Court in the case of Arts & Crafts Exports Ltd vs ITO 246 CTR 463 (Bom). Therefore, respectfully following the decision of the Tribunal for earlier years, we decide this issue in favour of the assessee and direct the Assessing Officer to follow the order of the Tribunal for earlier years on this issue also. Accordingly, these grounds are allowed.

4.5 Grounds 11 & 12: In these grounds, the assessee has contested that there is no proper application of mind by the lower authorities, and therefore, these grounds need fresh adjudication. Per contra, the Ld. DR did not raise any objection in this regard.

4.6 We have gone through the orders of lower authorities and find that the Assessing Officer had not applied his mind on this issue specifically. Deduction u/s 10A / 10B was denied at the threshold. The benefit was denied as part of total miscellaneous receipts without making any specific discussion with regard to the impugned amount. The other issues have also been sent back to the file of the Assessing Officer and therefore, in the interest of justice, we deem it appropriate to send this issue also back to the file of the Assessing Officer for fresh adjudication. The Assessing Officer shall decide this issue in proper manner, after giving adequate opportunity of hearing to the assessee.

Order pronounced in the court on this 30th day of September, 2016.