- (1.) This order will dispose of IT Appeal Nos. 839 and 840 of 2010 as it has been stated by the learned Counsel for the Revenue that both the appeals relate to same Assessee and involve some common questions.
(2.) IT Appeal No. 840 of 2010 has been preferred by the Revenue under Section 260A of the IT Act, 1961 (for short the Act) against the order dt. 29th Jan., 2010 of the Tribunal, Chandigarh Bench B, Chandigarh in ITA No. 602/Chd/2008 for the assessment year 2004-05 proposing to raise following substantial questions of law: (i) Whether on the facts and circumstances of the case, Honble Tribunal is justified in law in allowing deduction under Section 80-IB on labour job receipts ignoring the fact that such income is not derived from the eligible business of industrial undertaking of the Assessee company ? (ii) The Honble Tribunal has not correctly appreciated the fact that appeal against the decision of Honble Punjab & Haryana High Court in the case of CIT v. Impel Forge & Allied Industries Ltd. passed in IT Appeal No. 543 of 2008, dt. 5th Dec, 2008 was not filed by the Department before the Honble Supreme Court due to the reasons that the tax effect involved in that case was less than the monetary limits of Rs. 10 lakhs for filing SLP as per CBDT Instruction No. 5 of 2008, dt. 15 May, 2008 M. Natarajan Vs. State, 2008 217 CTR 1 (iii) Whether on the facts and circumstances of the case, Honble Tribunal is justified in law in allowing deduction under Section 80-IB on other miscellaneous income being miscellaneous receipts, rebate and discount and balances written off etc. whereas such income is not derived from the eligible business of industrial undertaking of the Assessee company ? (iv) Whether on the facts and circumstances of the case, Honble Tribunal is justified in law in allowing depreciation on the assets which were not owned by the Assessee company but were purchased in the name of managing director of the company and his wife ? (v) Whether on the facts and circumstances of the case, Honble Tribunal is justified in law in allowing depreciation on electric installation @ 25 per cent instead of 15 per cent allowed by the AO ignoring the fact that the additions made to the electric installation were relating to electric panels and other accessories which was not found to be part of plant and machinery ? (vi) The Honble Tribunal has misinterpreted the fact that the Department has accepted the issue at (v) above in Assessees own case for the assessment year 2003-04 as no appeal against the decision of learned CIT(A) was filed before the Honble Tribunal, whereas the fact is that the appeal against the decision of learned CIT(A) passed in Appeal No. 216-IT/CIT(A)-1/2005-06, dt. 29th April, 2008 in Assessees own case for the assessment year 2003-04 on the issue under consideration was not filed by the Department for the reasons that the tax effect involved in that case was less than the monetary limits for filing appeal before the Honble Tribunal as per Boards Instruction No. 5 of 2008, dt. 15th May, 2008 ? (vii) Whether on the facts and circumstances of the case, Honble Tribunal is justified in law in allowing exemption on the income i.e., dividend income which was not claimed as exempt in the return of income filed by the Assessee and the AO had rightly not allowed exemption of dividend income under Section 10(35) in view of the decision of Honble Supreme Court in the case of Goetze (India) Ltd. v. CIT,2006 204 CTR(SC) 182,
(3.) While assessing the income of the Assessee for the assessment year in question, the AO made certain additions on account of following: (i) Deduction claimed under Section 80-IB in respect of receipt from the job work/processing charges was disallowed on the ground that the said income was not derived from specified industrial undertaking. (ii) Deduction under Section 80-IB in respect of miscellaneous receipts, rebate and discount and balances written off etc. was also disallowed on the ground that the same were not derived from eligible business. (iii) Deduction under Section 80-IB in respect of interest income was disallowed on the same ground. (iv) Depreciation on air conditioners was disallowed on the ground that same were in the name of managing director of the company and his wife and not in the name of the Assessee, (v) Depreciation on electrical installations claimed at the rate applicable to plant and machinery was not allowed on the ground that the electric installations were separate from plant and machinery attracting less rate of depreciation. (vi) Dividend income though exempt under Section 10(35) was not treated as exempt in absence of claim in the return following the judgment of Honble Supreme Court in Goetze (India) Ltd. v. CIT,2006 204 CTR(SC) 182.;