ACIT, New Delhi v. M/s. Legacy Food Pvt. Ltd., New Delhi

ITA 6197/DEL/2016 | 2011-2012
Pronouncement Date: 28-02-2020 | Result: Allowed

Appeal Details

RSA Number 619720114 RSA 2016
Assessee PAN AAACL9887F
Bench Delhi
Appeal Number ITA 6197/DEL/2016
Duration Of Justice 3 year(s) 2 month(s) 26 day(s)
Appellant ACIT, New Delhi
Respondent M/s. Legacy Food Pvt. Ltd., New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 28-02-2020
Appeal Filed By Department
Order Result Allowed
Bench Allotted D
Tribunal Order Date 28-02-2020
Assessment Year 2011-2012
Appeal Filed On 02-12-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: D NEW DELHI BEFORE SHRI AMIT SHUKLA JUDICIAL MEMBER AND SHRI O.P. KANT ACCOUNTANT MEMBER ITA NO.6196/DEL./2016 ASSESSMENT YEAR: 2010-11 AND ITA NO.6197/DEL./2016 ASSESSMENT YEAR: 2011-12 ACIT CIRCLE-15(1) NEW DELHI VS. M/S. LEGACY FOOD PVT. LTD. C-48 KAILASH APARTMENTS KAILASH COLONY NEW DELHI PAN :AAACL9887F (APPELLANT) (RESPONDENT) ORDER PER O.P. KANT AM: THESE TWO APPEALS BY THE REVENUE ARE DIRECTED AGAIN ST COMMON IMPUGNED ORDER DATED 05/09/2016 PASSED BY TH E LEARNED COMMISSIONER OF INCOME -TAX (APPEALS)-5 DE LHI [IN SHORT THE LD. CIT(A)] FOR ASSESSMENT YEAR 2010-11 AND 2 011-12. IN THESE APPEALS IDENTICAL GROUNDS HAVE BEEN RAISED I N SAME SET OF FACTS AND CIRCUMSTANCES ACCORDINGLY BOTH THESE AP PEALS WERE APPELLANT BY SHRI J.K. MISHRA CIT(DR) RESPONDENT BY DR. RAKESH GUPTA ADV. SHRI SOMIL AGARWAL ADV. DATE OF HEARING 14.01.2020 DATE OF PRONOUNCEMENT 28.02.2020 2 ITA NO. 6196 & 6197/DEL./2016 HEARD TOGETHER AND DISPOSED OFF BY WAY OF THIS CONS OLIDATED ORDER FOR CONVENIENCE AND AVOID REPETITION OF THE FACTS. FOR BREVITY THE GROUNDS RAISED BY THE ASSESSEE IN ITA NO. 6197/DEL/ 2016 FOR ASSESSMENT YEAR 2011-12 ARE REPRODUCED AS UNDER: 1. WHETHER ON THE FACTS AND IN LAW THE LD CIT(A) WAS RIGHT IN DELETING THE ADDITION OF RS. 2 59 58 108/- MADE BY THE AO BY WAY OF DISALLOWANCE OF BENEFIT OF DEDUCTION U/S 80I C. 2. THE LD. CIT (A) ERRED ON FACTS AND IN LAW IN DE LETING THE ADDITION OF RS. 2 59 58 108/- MADE U/S 801C NOT TAKING INTO CONSIDERATION THE FACT THAT AS PER ACTION POINT NO. 5 MENTIONED I N THE RULES THE REPORT IN FORM 10CCB OUGHT TO HAVE BEEN ACCOMPANIED WITH COPY OF AGREEMENT WITH ANY CENTRAL GOVERNMENT/STATE GOVERNMENTS/LOCAL AUTHORITY FOR CARRYING AN ELIGIBL E BUSINESS. 3. THE LD. CIT (A) OUGHT TO HAVE CONSIDERED THE LE GAL ISSUE RAISED BY THE AO FOR THE A. Y. 2010-11 WHILE DECIDING THE ISS UE FOR THE A. Y. 2011-12 AS WELL AS THE FACTS AND LEGAL POSITION RE MAINS THE SAME FOR BOTH THE YEARS. THE LD CIT (A) HAS ERRED IN DEL ETING THE ADDITION WHICH IS UNJUSTIFIED AGAINST THE FACTS OF THE CASE AS WELL AS AGAINST THE PROVISION OF LAW. 4. THE LD. CIT (A) ERRED ON FACTS AND IN LAW ON AC COUNT OF VIOLATION OF SECTION 80-1C (7) R.W.S 80-IA (7) OF INCOME-TAX ACT 1961 AND SIMULTANEOUS VIOLATION OF RULE 18BBB OF INCOME-TAX RULE 1962. 5. THE LD.CIT(A) IS SILENT ON SUB RULE 4 OF RULE 18 BBB WHICH REQUIRES THAT FORM NO. 10CCB SHALL BE ACCOMPANIED W ITH COPY OF AGREEMENT WITH ANY CENTRAL GOVERNMENT /STATE GOVERNMENT/LOCAL AUTHORITY FOR CARRYING AN ELIGIBLE BUSINESS. 6. THE LD. CIT (A) ERRED ON FACTS AND IN LAW DID N OT APPRECIATE THE EFFORTS AND MATERIAL BROUGHT TO THE RECORD BY THE A SSESSING OFFICER IN THE REMAND REPORT FOR THE A.Y.2010-11. ALTHOUGH THE ASSESSING OFFICER HAS CORRECTLY RAISED THE LEGAL ISSUES BEFOR E THE LD.CIT (A) THE LD.CIT(A) HAS REJECTED THE CONTENTION OF THE AO BY MERELY STATING THAT THIS IS FOUND TO BE A NON-ISSUE. 7. THAT THE GROUNDS OF APPEAL ARE WITHOUT PREJUDICE TO EACH OTHER. 8. THAT THE APPELLANT CRAVES LEAVE TO ADD ALTER A MEND OR FOREGO ANY GROUND(S) OF THE APPEAL RAISED ABOVE AT THE TIME OF THE HEARING. 3 ITA NO. 6196 & 6197/DEL./2016 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSES SEE WAS ENGAGED IN RENDERING SERVICES OF THE JOB WORK TO M/ S GLAXO SMITHKLINE CONSUMER HEALTHCARE LTD.(IN SHORT THE G LAXO). ACCORDING TO THE ASSESSING OFFICER THE JOB WORK WA S ONLY OF PACKAGING OF HORLICKS BOOST AND ANOTHER PRODUC TS OF THE COMPANY GLAXO WHEREAS ACCORDING TO THE ASSESSEE IT WAS ENGAGED IN CONTRACT MANUFACTURING OF THOSE PRODUCTS FOR THE SAID COMPANY. 2.1 THE ASSESSEE FILED RETURN OF INCOME FOR ASSESSMENT YEAR 2010-11 ON 06/10/2010 DECLARING NIL INCOME AND FOR ASSESSMENT YEAR 2011-12 ON 29/09/2011 DECLARING TOTAL INCOME O F 6 07 98 667/-. THE ASSESSMENTS UNDER SECTION 143(3) OF THE INCOME-TAX ACT 1961 (IN SHORT THE ACT) FOR ASSES SMENT YEARS 2010-11 AND 2011-12 WERE COMPLETED ON 31/03/2013 AN D 24/03/2014 RESPECTIVELY. DURING THE ASSESSMENT PROC EEDING THE ASSESSING OFFICER NOTICED CLAIM OF DEDUCTION BY THE ASSESSEE UNDER SECTION 80IC OF THE ACT AMOUNTING TO 8 33 74 722/- @ 100% OF THE PROFIT OF THE ELIGIBLE BUSINESS FOR ASS ESSMENT YEAR 2010-11 AND AMOUNTING TO 2 59 58 108/- @ 30% OF THE PROFIT OF THE ELIGIBLE BUSINESS FOR ASSESSMENT YEAR 2011-12. THE CLAIM OF THE ASSESSEE WAS EXAMINED BY THE ASSESSING OFFICER IN THE LIGHT OF THE NATURE OF THE ACTIVITIES CARRIED OUT BY THE ASS ESSEE. THE ASSESSING OFFICER NOTED THAT NATURE OF THE BUSINESS WAS SHOWN IN FORM NO. 3CD OF THE TAX AUDIT REPORT IS OF RENDERIN G SERVICES OF THE JOB WORK (PACKAGING OF HORLICKS BOOST ETC.) FO R THE GLAXO. THE PROFIT AND LOSS ACCOUNT OF THE ASSESSEE SHOWED JOB WORK RECEIPT OF 26 41 75 048/- FOR ASSESSMENT YEAR 2010-11 AND 30 58 84 250/- FOR ASSESSMENT YEAR 2011-12. IN RESP ONSE TO THE 4 ITA NO. 6196 & 6197/DEL./2016 QUERY RAISED BY THE ASSESSING OFFICER TO JUSTIFY TH E CLAIM OF DEDUCTION THE ASSESSEE SUBMITTED A DETAILED REPLY ALONG WITH COPY OF THE EXCISE REGISTRATION CERTIFICATE AND THE PROCESS FLOWCHART. IT WAS CLAIMED BY THE ASSESSEE THAT IT W AS CONTRACT MANUFACTURE AND HAD ENTERED INTO A MOU WITH THE GL AXO BY WAY OF WRITTEN AGREEMENT DATED 11/10/2004 FOR THE PROCE SSING OF RAW MATERIAL SUPPLIED BY THE GLAXO BY USE OF ITS OWN PL ANT AND MACHINERY FOLLOWED BY PACKAGING OF THE FINAL PRODUC TS. THE ASSESSEE CLAIMED THAT PRODUCT MANUFACTURED BY THE C OMPANY WERE TREATED AS MANUFACTURING ACTIVITIES UNDER THE CENTRAL EXCISE RULES FALLING WITHIN CHAPTER 19 OF CENTRAL EXCISE T ARIFF ACT. 2.2 THE ASSESSING OFFICER PERUSED THE MANUFACTURING EX PENSES OF THE ASSESSEE AND FOUND THAT NO SIGNIFICANT MATER IAL WAS BEING PUT TO USE IN THE PROCESS UNDERTAKEN BY THE ASSESSE E IN RESPECT OF THE TOTAL JOB WORK RECEIPTS OF 26 41 75 048/- FOR ASSESSMENT YEAR 2010-11 AND 30 58 84 250/- FOR ASSESSMENT YEAR 2011-12 AGAINST WHICH THE MANUFACTURING EXPENSES OF ONLY 7 87 48 768/-AND 8 53 10 054/- HAD BEEN CLAIMED AS INCURRED. THE ASSESSING OFFICER NOTICED THAT EVEN OUT OF THO SE EXPENSES THE MAJORITY OF THE EXPENSES RELATED TO GENERATOR ELECTRICITY EXPENSES. THE ASSESSING OFFICER REFERRED TO THE DEF INITION OF THE MANUFACTURING PROVIDED IN SECTION 2(29BA) OF THE AC T AND OBSERVED THAT THE ACTIVITY OF THE ASSESSEE DO NOT S ATISFY THE MANUFACTURING DEFINED IN SAID SECTION. THE ASSESSIN G OFFICER MENTIONED THAT THE SIMILAR ISSUE WAS IN THE ASSESSM ENT FOR ASSESSMENT YEAR 2009-10 WHEREIN THE DEDUCTION UNDE R SECTION 80IC HAD BEEN DENIED TO THE ASSESSEE. 5 ITA NO. 6196 & 6197/DEL./2016 2.3 IN VIEW OF THE ABOVE OBSERVATIONS THE LEARNED ASS ESSING OFFICER DISALLOWED CLAIM OF DEDUCTION UNDER SECTION 80IC OF THE ACT AMOUNTING TO 8 33 74 722/- FOR ASSESSMENT YEAR 2010-11 AND 2 59 58 108/- FOR ASSESSMENT YEAR 2011-12. 2.4 AGGRIEVED THE ASSESSEE FILED APPEAL BEFORE THE LD . CIT(A) AND SUBMITTED THAT IN ASSESSMENT YEAR 2009-10 THE LD. CIT(A) AS WELL AS THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOU R OF THE ASSESSEE. THE ASSESSEE ALSO SUBMITTED THAT IT HAS C OMPLIED ALL THE NECESSARY CONDITION FOR CLAIM OF DEDUCTION UNDER SE CTION 80IC I.E. IT WAS DOING MANUFACTURING ACTIVITIES AND HAD CONSE QUENTLY CORRECTLY CLAIM THE DEDUCTION UNDER THE SAID SECTIO N. THE DETAILED SUBMISSION OF THE ASSESSEE HAVE BEEN REPRODUCED BY THE LEARNED CIT(A) IN THE IMPUGNED ORDER. 2.5 THE LD. CIT(A) REFERRED THE MATTER TO THE ASSESSING OFFICER REGARDING THE POSSIBLE APPLICATION OF THE PROVISION OF SECTION 80IC(7) OF THE ACT. IN THE REMAND REPORT THE ASSES SING OFFICER SUBMITTED THAT THE ASSESSEE HAS NOT COMPLIED THE RU LE 18BBB OF THE INCOME-TAX RULES 1962 (IN SHORT THE RULES) A ND DID NOT FILE DETAILS OF THE APPROVAL/PERMISSION ISSUED BY THE CE NTRAL GOVERNMENT/STATE GOVERNMENT/LOCAL AUTHORITY FOR CAR RYING OUT THE ELIGIBLE BUSINESS VIDE COLUMN 13 OF THE FORM NO . 10CCB OF THE INCOME-TAX FORMS. THE LD. CIT(A) FORWARDED THE REMA ND REPORT TO THE ASSESSEE. IN THE REJOINDER THE ASSESSEE SUBMIT TED THAT RELEVANT REQUIREMENT OF APPROVAL/PERMISSION ISSUED BY THE CENTRAL GOVERNMENT/STATE GOVERNMENT/LOCAL AUTHORITY WAS NOT IN RELATION TO DEDUCTION UNDER 80IC AND IT WAS RELATED ONLY TO SECTION 80IA/80IB OF THE ACT. 6 ITA NO. 6196 & 6197/DEL./2016 2.6 THE LD. CIT(A) IS OF THE VIEW THAT THE ASSESSING O FFICER HAS RELIED ON THE FINDING IN ASSESSMENT YEAR 2009-10 W HEREIN THE LEARNED FIRST APPELLATE AUTHORITY HAS ALREADY DELET ED THE DISALLOWANCE WHICH HAS ALSO BEEN AFFIRMED BY THE T RIBUNAL. THE LD. CIT(A) HELD THAT IN VIEW OF THE MATTER STOOD DE CIDED IN FAVOUR OF THE ASSESSEE BY TWO AUTHORITIES HE SAW NO REASO N TO DEVIATE FOR THE SAME PARTICULARLY WHEN THERE WAS NO CHANGE IN T HE FACTS AND CIRCUMSTANCES OF THE CASE. HE ALSO RELIED ON THE DE CISION OF THE TRIBUNAL IN THE CASE OF ZEON LIFE SCIENCES PRIVATE LIMITED (59 TAXMANN.COM 229) WHEREIN THE JOB WORK ACTIVITY HAS BEEN HELD TO BE TANTAMOUNT TO MANUFACTURING. THE CIT(A) CONCLUD ED THAT THE ISSUE OF MANUFACTURING PROCESS INVOLVED IN THE CASE OF THE ASSESSEE WAS NO LONGER RES INTEGRA AND HAD TO BE DECIDED IN FAVOUR OF THE ASSESSEE. 2.7 ON THE ISSUE OF POSSIBLE APPLICATION OF THE PROVIS ION OF SECTION 80IC(7) THE LD. CIT(A) HAS GIVEN TWO FINDIN GS; FIRSTLY THE LD. CIT(A) OBSERVED THAT FROM THE FINA NCIAL STATEMENTS AND THE DISCUSSION WITH THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE THERE WAS NO OTHER BUSINESSES WHICH WAS CARRIED OUT BY THE ASSESSEE H ENCE THERE WAS NO REASON TO GO INTO THE ISSUE OF DERIVIN G OF MORE THAN ORDINARY PROFIT WHICH MIGHT BE EXPECTED TO AR ISE IN THE ELIGIBLE BUSINESS AS ENSHRINED IN THOSE SUBSECTION. SECONDLY THE LEARNED AO POINTED OUT THE ISSUE OF D EFICIENCY IN THE FORM NO. 10CCB FILED BY THE ASSESSEE. THE LD . CIT(A) HELD THIS TO BE A NON-ISSUE AND AGREED WITH THE SUB MISSION OF THE ASSESSEE AND OBSERVED THAT SAID REQUIREMENT OF SUBMITTING DETAILS OF APPROVAL/PERMISSION WAS IN RE LATION TO 7 ITA NO. 6196 & 6197/DEL./2016 SECTION 80IA OR 80IB ONLY AND NOT WITH RELATION TO DEDUCTION UNDER SECTION 80IC OF THE ACT. 2.8 THE RELEVANT FINDING OF THE LD. CIT(A) IS REPRODUC ED AS UNDER: 5.6.3 KEEPING ALL THE FACTS AND CIRCUMSTANCES IN M IND THE ISSUE REGARDING THE MANUFACTURING PROCESS INVOLVED IN THE APPELLANTS BUSINESS IS NO LONGER RES-INTEGRA AND HAS TO BE DEC IDED IN FAVOUR OF THE APPELLANT. COMING TO THE OTHER ISSUE WHICH . I NVOLVES THE POSSIBLE APPLICATION OF THE PROVISIONS OF SECTION 8 0IC(7) R.W.S 80IA(10) ALTHOUGH THE ASSESSING OFFICER HAS NOT CO MMENTED ON THIS ISSUE IN THE REMAND REPORT IT IS CLEAR FROM THE FI NANCIAL STATEMENTS AND THE DISCUSSIONS WITH THE AR THAT THERE IS NO O THER BUSINESS WHICH IS CARRIED OUT BY THE APPELLANT COMPANY. HENC E THERE IS NO REASON TO GO INTO THE ISSUE OF THE DERIVING OF MORE THAN ORDINARY PROFITS WHICH MIGHT BE EXPECTED TO ARISE IN THE ELI GIBLE BUSINESS AS ENSHRINED IN THOSE SUB SECTIONS. HOWEVER THE A.O H AS RAISED A SEPARATE ISSUE REGARDING THE DEFICIENCIES IN THE AU DIT REPORT IN FORM 10CCB WHICH ARE BRIEFLY DISCUSSED AT PARA 5.4 HERE IN ABOVE. THE PROVISIONS OF SECTION 80IC OF THE ACT ARE APPLICABL E TO ANY UNDERTAKING OR ENTERPRISE WHICH HAS BEGUN OR BEGAN TO MANUFACTURE PRODUCE ANY ARTICLE OR THING AND IS N OT ENGAGED IN THE MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING SPECIFIED IN THIRTEENTH SCHEDULE OF THE ACT. THE SECTION FURTHER DEALS WITH AN INDUSTRIAL UNDERTAKING SITUATED IN ANY OF THE ELIGI BLE STATES AND WHICH IS ENGAGED IN THE MANUFACTURE OR PRODUCTION O F ARTICLES OR THING SPECIFIED IN FOURTEENTH SCHEDULE OF THE ACT. IN THE PRESENT CASE THE APPELLANT HAS ESTABLISHED ITS MANUFACTURI NG UNIT IN HIMACHAL PRADESH AN INDUSTRIALLY BACKWARD STATE SP ECIFIED IN EIGHTH SCHEDULE TO THE INCOME TAX ACT. AS PER THE P ROVISIONS OF SECTION 80IC(4) OF THE ACT THE CONDITIONS TO BE FU LFILLED BY THE UNDERTAKING OR THE ENTERPRISES ARE ENSHRINED. IT IS PROVIDED THAT FOR AVAILING DEDUCTION U/S 80IC OF THE ACT THE UNDERTA KING OR ENTERPRISES IS TO FULFILL THE FOLLOWING CONDITIONS I.E. (I) IT IS NOT FORMED BY SPLITTING UP OR THE RECONSTRUCTION OF THE BUSINE SS ALREADY IN EXISTENCE; (II) IT IS NOT FORMED BY TRANSFER TO A N EW BUSINESS OR MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE. IT IS NOT THE CASE OF THE DEPARTMENT THAT ANY MACHINERY WAS PREVI OUSLY USED FOR ANY PURPOSES WHICH HAS BEEN TRANSFERRED TO THE APP ELLANT OR IT WAS FORMED BY SPLITTING UP OR THE RECONSTRUCTION OF THE BUSINESS ALREADY IN EXISTENCE. 5.6.4 IN SO FAR AS THE DEFICIENCIES IN FORM 10CCB I S CONCERNED WHICH ISSUE THE AO HAS RAISED DURING THE REMAND PROCEEDIN GS THIS IS FOUND TO BE A NON-ISSUE. FORM 10CCB IS AN OMNIBUS F ORM TO BE FILLED UP BY AN ASSESSEE CLAIMING DEDUCTION UNDER THE PROV ISIONS OF 8 ITA NO. 6196 & 6197/DEL./2016 SECTIONS 801 80IA 80IB OR 80IC EXCEPT FOR CERTAI N ENTITIES SUCH AS MULTIPLEX THEATRES [DEFINED IN SECTION 80IB (7A)] CONVENTION CENTRES [DEFINED IN SECTION 80IB (7B)] AND HOSPITALS IN RUR AL AREAS [DEFINED IN SECTION 80IB (11B)]. SUB RULE (3) OF RULE 18BBB PRO VIDES THAT ONLY THOSE ENTERPRISES CARRYING ON THE BUSINESS FOR DEVE LOPING OR OPERATING AND MAINTAINING OR DEVELOPING OPERATING AND MAINTAINING AN INFRASTRUCTURE FACILITY (AS PER SECTION 80IA (4) (B) WOULD SUBMIT THE FORM ACCOMPANIED BY A COPY OF THE AGREEMENT OF THE ENTERPRISE WITH THE CENTRAL GOVERNMENT OR THE LOCAL AUTHORITY FOR C ARRYING ON THE BUSINESS OF DEVELOPING OR OPERATING AND MAINTAINING OR DEVELOPING OPERATING AND MAINTAINING THE INFRASTRUCTURE FACILI TY. THIS ASPECT HAS BEEN CLARIFIED AS PER ACTION POINT 6 MENTIONED IN T HE RULES. 2.9 THE OTHER ISSUES RAISED BY THE ASSESSEE WERE ALSO ADJUDICATED BY THE LD. CIT(A) IN THE IMPUGNED ORDER . 2.10 AGGRIEVED WITH THE FINDING OF THE LD. CIT(A) THE R EVENUE HAS RAISED THE DELETION OF DISALLOWANCE OF DEDUCTION I N BOTH THE ASSESSMENT YEARS IN GROUND NO. 1 OF THE APPEALS. IN GROUND NO. 2 TO 6 THE REVENUE HAS CHALLENGED SILENCE OF LD. CIT (A) ON VIOLATION OF SUB-RULE 4 OF RULE 18BBB OF THE RULES BY MERELY STATING THAT IT WAS FOUND TO BE A NONISSUE. 3. BEFORE US THE LEARNED DR RELIED ON THE ORDER OF T HE ASSESSING OFFICER AND THE REMAND REPORT FILED BY HI M BEFORE THE LD. CIT(A). ACCORDING TO HIM FILING OF COPY OF AGR EEMENT OR PERMISSION TO CARRY ON THE ACTIVITY SIGNED OR ISSU ED BY THE CENTRAL GOVERNMENT OR THE STATE GOVERNMENT OR THE L OCAL AUTHORITY FOR CARRYING ON THE ELIGIBLE BUSINESS WA S REQUIREMENT OF SUB-RULE 4 OF RULE 18BBB OF THE RULES WHICH THE AS SESSEE DID NOT SATISFY DESPITE SPECIFICALLY ASKED TO FILE SUCH APPROVAL OR PERMISSION DURING THE COURSE OF THE REMAND PROCEEDI NG. HE SUBMITTED THAT MATTER MAY BE RESTORED BACK TO THE L EARNED CIT(A) TO GIVE A REASONED FINDING ON THE ISSUE OF THE REQU IREMENT OF RULE 9 ITA NO. 6196 & 6197/DEL./2016 18BBB(4) OF THE RULES AND ALSO THE ABNORMAL PROFIT FROM THE JOB WORK DECLARED BY THE ASSESSEE. 3.1 THE LEARNED COUNSEL OF THE ASSESSEE ON THE OTHER HAND SUBMITTED THAT ISSUE IN DISPUTE HAS ALREADY BEEN DE CIDED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL IN ASSESSMEN T YEAR 2009- 10 AND THERE BEING NO CHANGE IN FACTS AND CIRCUMSTA NCES OF THE CASE THE ISSUE IN DISPUTE WHETHER THE ACTIVITY OF THE ASSESSEE IS MANUFACTURING IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. 4. WE HAVE HEARD RIVAL SUBMISSION OF THE PARTIES ON T HE ISSUE IN DISPUTE AND PERUSED THE RELEVANT MATERIAL ON REC ORD. WE FIND THAT THE LD. CIT(A) HAS FOLLOWED THE FINDING OF THE TRIBUNAL IN ITA NO. 3643/DEL/2013 FOR ASSESSMENT YEAR 2009-10 IN TH E CASE OF THE ASSESSEE ITSELF TO HOLD THAT THE ACTIVITY OF TH E UNDERTAKING OF THE ASSESSEE IS IN THE NATURE OF THE MANUFACTURING ACTIVITY AND FOR THEREFORE ASSESSEE IS ENTITLED FOR THE DEDUCTION I N TERMS OF SECTION 80IC OF THE ACT. BUT ON THE ISSUE OF APPLIC ATION OF SECTION 80I(7) THE LD. CIT(A) CALLED FOR THE REMAND REPORT FROM THE ASSESSING OFFICER. THE RELEVANT DIRECTION OF THE LD . CIT(A) ALONG WITH SUBMISSION OF THE ASSESSING OFFICER IN REMAND REPORT IN BRIEF ARE REPRODUCED AS UNDER: 5.4 AS ALREADY STATED HEREIN ABOVE THE ISSUE REGA RDING THE POSSIBLE APPLICATION OF THE PROVISIONS OF SECTION 8 0IC(7) WAS REFERRED TO THE A.O. IN HER REPORT DATED 02.08.2016 THE A.O. HAS MENTIONED THAT IN ACCORDANCE WITH THE PROVISIONS OF SECTION 8 0IC(7) R.W.S. 80IA(7) THE AUDIT REPORT WAS MANDATED AS PER RULE 18BBB OF THE I.T. RULES 1962 IN FORM 10CCB. THE APPELLANT WAS R EQUIRED TO GIVE DETAILS OF THE APPROVAL/PERMISSION ISSUED BY THE CE NTRAL GOVERNMENT/STATE GOVERNMENT/ LOCAL AUTHORITY FOR CA RRYING OUT THE ELIGIBLE BUSINESS VIDE COLUMN 13 THEREIN. FURTHER T HE REPORT IN FORM 10CCB IS NOT ACCOMPANIED WITH THE COPY OF THE AGREE MENT WITH THE CENTRAL GOVERNMENT/STATE GOVERNMENT/ LOCAL AUTHORIT Y FOR CARRYING OUT THE ELIGIBLE BUSINESS. SINCE THE APPELLANT HAD FAILED TO COMPLY WITH THESE PROVISIONS IT WAS NOT ENTITLED TO DEDUCT ION U/S 80IC. 10 ITA NO. 6196 & 6197/DEL./2016 4.1 SINCE THE REVENUE HAS CHALLENGED THAT PROVISIONS O F SECTION 80-IC(7) HAVE NOT BEEN SATISFIED BY THE ASSESSEE I T IS RELEVANT TO FIRST REPRODUCE THE RELEVANT PROVISIONS AS UNDER: 80-IC (7) THE PROVISIONS CONTAINED IN SUB-SECTION (5) AND SUB- SECTIONS (7) TO (12) OF SECTION 80-IA SHALL SO FAR AS MAY BE APPLY TO THE ELIGIBLE UNDERTAKING OR ENTERPRISE UNDER THIS S ECTION. 4.2 WE FIND THAT SECTION 80-IC(7) OF THE ACT HAS FURTH ER PRESCRIBED APPLICABILITY OF SECTION 80-IA(5) AND 80 -IA(7) TO 80- IA(12) OF THE ACT. THE SECTION 80-IA(5) READS AS UN DER: 80-IA. (5) NOTWITHSTANDING ANYTHING CONTAINED IN A NY OTHER PROVISION OF THIS ACT THE PROFITS AND GAINS OF AN ELIGIBLE BUSINESS TO WHICH THE PROVISIONS OF SUB-SECTION (1) APPLY SHALL FOR THE PURPOSES OF DETERMINING THE QUANTUM OF DEDUCTION UNDER THAT SUB-SECTION FOR THE ASSESSMENT YEAR IMMEDIATELY SUCCEEDING THE INIT IAL ASSESSMENT YEAR OR ANY SUBSEQUENT ASSESSMENT YEAR BE COMPUTED AS IF SUCH ELIGIBLE BUSINESS WERE THE ONLY SOURCE OF INCOME OF THE ASSESSEE DURING THE PREVIOUS YEAR RELEVANT TO THE INITIAL AS SESSMENT YEAR AND TO EVERY SUBSEQUENT ASSESSMENT YEAR UP TO AND INCLU DING THE ASSESSMENT YEAR FOR WHICH THE DETERMINATION IS TO B E MADE. 4.3 SINCE IN THE INSTANT CASE ISSUE IN DISPUTE IS NOT IN RESPECT OF THE QUANTUM OF THE DEDUCTION WITH RESPECT TO INTRA- UNITS AND THEREFORE THERE IS NO EFFECT OF SECTION 80IA(5) OF THE ACT IN THE INSTANT CASE. 4.4 FURTHER THE SECTION 80-IA(7) OF THE ACT PRESCRIBE S FOR ADMISSIBILITY OF THE DEDUCTION SUBJECT TO FILING OF THE AUDIT REPORT IN PRESCRIBED FORM DULY SIGNED AND VERIFIED BY THE ACCOUNTANT. THE RELEVANT SECTION IS REPRODUCED AS UNDER: 80-IA (7) THE DEDUCTION UNDER SUB-SECTION (1) FROM PROFITS AND GAINS DERIVED FROM AN UNDERTAKING SHALL NOT BE ADMISSIBLE UNLESS THE ACCOUNTS OF THE UNDERTAKING FOR THE PREVIOUS YEAR R ELEVANT TO THE 11 ITA NO. 6196 & 6197/DEL./2016 ASSESSMENT YEAR FOR WHICH THE DEDUCTION IS CLAIMED HAVE BEEN AUDITED BY AN ACCOUNTANT AS DEFINED IN THE EXPLANA TION BELOW SUB- SECTION (2) OF SECTION 288 AND THE ASSESSEE FURNISHES ALONG WITH HIS RETURN OF INCOME THE REPORT OF SUCH AUDIT IN THE P RESCRIBED FORM DULY SIGNED AND VERIFIED BY SUCH ACCOUNTANT. 4.5 FURTHER THE RULE 18BBB HAS PRESCRIBED FORM NO. 10 CCCB FOR FILING THE AUDIT REPORT ALONG WITH THE AGREEMEN T OR APPROVAL OR PERMISSION WHICHEVER MAY BE THE CASE AS UNDER : [ FORM OF AUDIT REPORT FOR CLAIMING DEDUCTION UNDER SE CTION 80-I OR 80-IA OR [ 80-IB OR SECTION 80-IC ] . 18BBB. (1) THE REPORT OF THE AUDIT OF THE ACCOUNTS OF AN A SSESSEE WHICH IS REQUIRED TO BE FURNISHED UNDER SUB-SECTION (7) OF SECTION 80- IA OR SUB-SECTION (7) OF SECTION 80-I EXCEPT IN TH E CASES OF MULTIPLEX THEATRES AS DEFINED IN SUB-SECTION (7A) OF SECTION 80-IB OR CONVENTION CENTRES AS DEFINED IN SUB-SECTION (7B) OF SECTION 8 0-IB [OR HOSPITALS IN RURAL AREAS AS DEFINED IN SUB-SECTION (11B) OF S ECTION 80-IB] SHALL BE IN FORM NO. 10CCB. (2) A SEPARATE REPORT IS TO BE FURNISHED BY EACH UN DERTAKING OR ENTERPRISE OF THE ASSESSEE CLAIMING DEDUCTION UNDER SECTION 80-I OR 80-IA OR 80-IB [OR 80-IC] AND SHALL BE ACCOMPANIED BY THE PROFIT AND LOSS ACCOUNT AND BALANCE SHEET OF THE UNDERTAKING O R ENTERPRISE AS IF THE UNDERTAKING OR THE ENTERPRISE WERE A DISTINC T ENTITY. (3) IN THE CASE OF AN ENTERPRISE CARRYING ON THE BU SINESS OF DEVELOPING OR OPERATING AND MAINTAINING OR DEVELOPI NG OPERATING AND MAINTAINING AN INFRASTRUCTURE FACILITY THE FOR M SHALL BE ACCOMPANIED BY A COPY OF THE AGREEMENT OF THE ENTER PRISE WITH THE CENTRAL GOVERNMENT OR THE STATE GOVERNMENT OR THE L OCAL AUTHORITY FOR CARRYING ON THE BUSINESS OF DEVELOPING OR OPERA TING AND MAINTAINING OR DEVELOPING OPERATING AND MAINTAININ G THE INFRASTRUCTURE FACILITY. (4) IN ANY OTHER CASE THE FORM SHALL BE ACCOMPANIE D BY A COPY OF THE AGREEMENT APPROVAL OR PERMISSION AS THE CASE MAY BE TO CARRY ON THE ACTIVITY SIGNED OR ISSUED BY THE CENTRAL GOVERN MENT OR THE STATE GOVERNMENT OR THE LOCAL AUTHORITY FOR CARRYING ON T HE ELIGIBLE BUSINESS.] 4.6 WHILE EXAMINING THE APPLICATION OF THE SECTION 80- IA(7) THE ASSESSING OFFICER IN THE REMAND REPORT PROCEEDINGS HAS POINTED OUT THAT THE ASSESSEE DID NOT ENCLOSE A COPY OF AG REEMENT OR 12 ITA NO. 6196 & 6197/DEL./2016 APPROVAL OR THE PERMISSION AS WAS REQUIRED UNDER S UB-RULE (4) OF RULE 18BBB OF THE RULES. THE ASSESSEE IN ITS REJOIN DER SUBMITTED THE COMMENTS WHICH HAVE BEEN SUMMARIZED BY THE LD. CIT(A) AS UNDER: 5.5 IN THE REJOINDER TO THE REPORT OF THE A.O FILE D DURING THE COURSE OF HEARING ON 30.08.2016 THE APPELLANT HAS SUBMITTED T HAT THE FILING OF THE AUDIT REPORT IS THE RESPONSIBILITY OF THE STATU TORY AUDITOR AND COLUMN NO. 13 OF FORM 10CCB IS NOT APPLICABLE FOR 8 0IC CASES. FROM A BARE PERUSAL OF SECTION 80IC IT IS APPARENT THAT THERE IS NO SUCH REQUIREMENT OF TAKING ANY APPROVAL FROM CENTRAL GOV ERNMENT/STATE GOVERNMENT/ LOCAL AUTHORITY FOR CARRYING OUT THE EL IGIBLE BUSINESS. IN FACT FORM 10CCB IS A CONSOLIDATED FORM FOR DEDUC TIONS CLAIMED UNDER SECTIONS 80IA 80IB & 80IC. IT IS STATED THAT APPROVAL IS REQUIRED FROM CENTRAL GOVERNMENT/STATE GOVERNMENT/ LOCAL AUTHORITY IN CASES OF 80IA/80IB AND NOT FOR SECTION 80IC. IT IS SETTLED LAW THAT THE ACTION POINT MENTION IN THE RULES CANN OT OVERRIDE THE RULES NOR CAN THE RULES OVERRIDE THE ACT. MY ATTENT ION HAS BEEN DRAWN TO ACTION POINT 6 AND MOREOVER IT IS SUBMITTE D THAT THIS WAS NEVER THE CASE OF THE A.O IN THE ASSESSMENT ORDERS AND IT WAS PRECISELY FOR THIS REASON THAT COLUMN NO. 13 WAS NE VER REQUIRED TO BE FILLED IN BY THE ASSESSEE. 4.7 AFTER TAKING INTO CONSIDERATION THE REJOINDER THE LD. CIT(A) ADJUDICATED THE ISSUE OF DEFICIENCY IN FORM NO. 10C CB AS UNDER: 5.6.4 IN SO FAR AS THE DEFICIENCIES IN FORM 10CCB IS CONCERNED WHICH ISSUE THE AO HAS RAISED DURING THE REMAND PRO CEEDINGS THIS IS FOUND TO BE A NON-ISSUE. FORM 10CCB IS AN OMNIBU S FORM TO BE FILLED UP BY AN ASSESSEE CLAIMING DEDUCTION UNDER T HE PROVISIONS OF SECTIONS 801 80IA 80IB OR 80IC EXCEPT FOR CERTAI N ENTITIES SUCH AS MULTIPLEX THEATRES [DEFINED IN SECTION 80IB (7A)] CONVENTION CENTRES [DEFINED IN SECTION 80IB (7B)] AND HOSPITALS IN RUR AL AREAS [DEFINED IN SECTION 80IB (11B)]. SUB RULE (3) OF RULE 18BBB PRO VIDES THAT ONLY THOSE ENTERPRISES CARRYING ON THE BUSINESS FOR DEVE LOPING OR OPERATING AND MAINTAINING OR DEVELOPING OPERATING AND MAINTAINING AN INFRASTRUCTURE FACILITY (AS PER SECTION 80IA (4) (B) WOULD SUBMIT THE FORM ACCOMPANIED BY A COPY OF THE AGREEMENT OF THE ENTERPRISE WITH THE CENTRAL GOVERNMENT OR THE LOCAL AUTHORITY FOR C ARRYING ON THE BUSINESS OF DEVELOPING OR OPERATING AND MAINTAINING OR DEVELOPING OPERATING AND MAINTAINING THE INFRASTRUCTURE FACILI TY. THIS ASPECT HAS BEEN CLARIFIED AS PER ACTION POINT 6 MENTIONED IN T HE RULES. 13 ITA NO. 6196 & 6197/DEL./2016 4.8 NOW BEFORE US THE REVENUE HAS RAISED THE GROUNDS THAT THE LD. CIT(A) HAS FOUND THIS TO BE A NONISSUE AND NOT GIVEN ANY REASONED FINDING ON VIOLATION OF THE SUBRULE (4) OF THE RULE 18BBB OF THE RULES. 4.9 ON PERUSAL OF THE ABOVE FINDING OF THE LEARNED CIT (A) WE FIND THAT LD. CIT(A) HAS NOT APPRECIATED THE REQUIR EMENT OF THE SUB-RULE (4) OF THE RULE 18BBB OF THE RULES. WE HAV E ALREADY REPRODUCED RULE 18BBB IN PRECEDING PARAGRAPHS OF TH IS ORDER. THE SUB-RULE (3) IS APPLICABLE IN CASE OF THE ENTER PRISE CARRYING ON THE BUSINESS OF THE DEVELOPING OR OPERATING AND MAI NTAINING OR DEVELOPING OPERATING AND MAINTAINING THE INFRASTRU CTURE FACILITY WHEREAS THE SUB-RULE (4) IS APPLICABLE ON THE ANY O THER CASE CARRYING ON THE ELIGIBLE BUSINESS. NO DOUBT THAT TH E DEDUCTION UNDER SECTION 80IC IS ALLOWABLE TO AN UNDERTAKING O R ENTERPRISES CARRYING ON THE BUSINESS REFERRED TO IN SUBSECTION 80IC(2) WHICH ARE ELIGIBLE BUSINESS FOR SAID SECTION. THUS THE S UB-RULE (4) IS APPLICABLE IN CASE OF DEDUCTION UNDER SECTION 80IC OF THE ACT AND THE FORM 10CCB FILED BY THE ASSESSEE WAS TO BE ACCO MPANIED WITH A COPY OF THE AGREEMENT OR APPROVAL OR PERMISSION AS THE CASE MAY BE TO CARRY ON THE ACTIVITY SIGNED OR ISSUED BY THE CENTRAL GOVERNMENT OR THE STATE GOVERNMENT OR THE LOCAL AUT HORITY FOR CARRYING ON THE ELIGIBLE BUSINESS. EVIDENTLY THIS REQUIREMENT HAS NOT BEEN FULFILLED BY THE ASSESSEE. THE REVENUE BEF ORE US HAS TAKEN THIS GROUND SPECIFICALLY AND ALSO SUBMITTED T HAT THIS ISSUE HAS NOT BEEN CONSIDERED BY THE TRIBUNAL IN ASSESSME NT YEAR 2009-10. THE FILING OF AGREEMENT/APPROVAL/PERMISSIO N BEING ONE OF REQUIREMENT OF THE STATUTE AND NOT COMPLIED BY T HE ASSESEE CANNOT BE REJECTED AS NON-ISSUE. IN THE FACTS AND CIRCUMSTANCES 14 ITA NO. 6196 & 6197/DEL./2016 OF THE CASE AND IN THE INTEREST OF THE SUBSTANTIAL JUSTICE WE FEEL IT APPROPRIATE TO RESTORE THE ISSUE IN DISPUTE THE FIL E OF THE ASSESSING OFFICER TO PROVIDE ONE MORE OPPORTUNITY T O THE ASSESSEE TO SATISFY THE REQUIREMENT OF SECTION 80IA(7) OF TH E ACT ALONG WITH RULES THEREON. WE ARE AWARE THAT ACTIVITY OF THE AS SESSEE HAS BEEN HELD TO MANUFACTURING ACTIVITY IN EARLIER YEAR BY THE TRIBUNAL BUT THE ASSESSEE IS REQUIRED TO FULFILL TH E REQUIREMENT OF LAW IN RELEVANT ASSESSMENT YEAR. WE MAY NOTE THAT T HE HONBLE SUPREME COURT IN THE CASE OF DISTRIBUTION (BARODA) PVT. LTD. VS. UNION OF INDIA 155 ITR 120 HAS HELD THAT TO PERPETU ATE AN ERROR IS NO HEROISM AND TO RECTIFY IT IS COMPULSION OF JU DICIAL CONSCIENCE. THE ISSUE IN DISPUTE IS ACCORDINGLY RE STORED TO THE FILE OF THE LEARNED ASSESSING OFFICER WHO AFTER VE RIFICATION OF THE COMPLIANCE OF SECTION 80-IC(7) SHALL DECIDE THE IS SUE IN DISPUTE OF DEDUCTION UNDER SECTION 80-IC OF THE ACT IN ACCO RDANCE WITH LAW. 4.10 FURTHER FOR EXAMINING THE APPLICABILITY OF THE S ECTION 80IA(8) TO 80IA(12) THE RELEVANT PROVISION ARE REP RODUCED AS UNDER: 80-IA(8) WHERE ANY GOODS OR SERVICES HELD FOR THE PURPOSES OF THE ELIGIBLE BUSINESS ARE TRANSFERRED TO ANY OTHER BUSI NESS CARRIED ON BY THE ASSESSEE OR WHERE ANY GOODS OR SERVICES HELD F OR THE PURPOSES OF ANY OTHER BUSINESS CARRIED ON BY THE ASSESSEE AR E TRANSFERRED TO THE ELIGIBLE BUSINESS AND IN EITHER CASE THE CONS IDERATION IF ANY FOR SUCH TRANSFER AS RECORDED IN THE ACCOUNTS OF THE EL IGIBLE BUSINESS DOES NOT CORRESPOND TO THE MARKET VALUE OF SUCH GOO DS OR SERVICES AS ON THE DATE OF THE TRANSFER THEN FOR THE PURPOSES OF THE DEDUCTION UNDER THIS SECTION THE PROFITS AND GAINS OF SUCH E LIGIBLE BUSINESS SHALL BE COMPUTED AS IF THE TRANSFER IN EITHER CAS E HAD BEEN MADE AT THE MARKET VALUE OF SUCH GOODS OR SERVICES AS ON THAT DATE: PROVIDED THAT WHERE IN THE OPINION OF THE ASSESSING OFFICER THE COMPUTATION OF THE PROFITS AND GAINS OF THE ELIGIBL E BUSINESS IN THE MANNER HEREINBEFORE SPECIFIED PRESENTS EXCEPTIONAL DIFFICULTIES THE 15 ITA NO. 6196 & 6197/DEL./2016 ASSESSING OFFICER MAY COMPUTE SUCH PROFITS AND GAIN S ON SUCH REASONABLE BASIS AS HE MAY DEEM FIT. EXPLANATION.FOR THE PURPOSES OF THIS SUB-SECTION 'MARKET VALUE' IN RELATION TO ANY GOODS OR SERVICES MEANS (I) THE PRICE THAT SUCH GOODS OR SERVICES WOULD O RDINARILY FETCH IN THE OPEN MARKET; OR (II) THE ARM'S LENGTH PRICE AS DEFINED IN CLAUSE ( II) OF SECTION 92F WHERE THE TRANSFER OF SUCH GOODS OR SERVICES IS A S PECIFIED DOMESTIC TRANSACTION REFERRED TO IN SECTION 92BA . (9) WHERE ANY AMOUNT OF PROFITS AND GAINS OF AN UND ERTAKING OR OF AN ENTERPRISE IN THE CASE OF AN ASSESSEE IS CLAIMED AND ALLOWED UNDER THIS SECTION FOR ANY ASSESSMENT YEAR DEDUCTI ON TO THE EXTENT OF SUCH PROFITS AND GAINS SHALL NOT BE ALLOWED UNDE R ANY OTHER PROVISIONS OF THIS CHAPTER UNDER THE HEADING 'C.DE DUCTIONS IN RESPECT OF CERTAIN INCOMES' AND SHALL IN NO CASE E XCEED THE PROFITS AND GAINS OF SUCH ELIGIBLE BUSINESS OF UNDERTAKING OR ENTERPRISE AS THE CASE MAY BE. (10) WHERE IT APPEARS TO THE ASSESSING OFFICER THAT OWING TO THE CLOSE CONNECTION BETWEEN THE ASSESSEE CARRYING ON T HE ELIGIBLE BUSINESS TO WHICH THIS SECTION APPLIES AND ANY OTHE R PERSON OR FOR ANY OTHER REASON THE COURSE OF BUSINESS BETWEEN TH EM IS SO ARRANGED THAT THE BUSINESS TRANSACTED BETWEEN THEM PRODUCES TO THE ASSESSEE MORE THAN THE ORDINARY PROFITS WHICH M IGHT BE EXPECTED TO ARISE IN SUCH ELIGIBLE BUSINESS THE AS SESSING OFFICER SHALL IN COMPUTING THE PROFITS AND GAINS OF SUCH E LIGIBLE BUSINESS FOR THE PURPOSES OF THE DEDUCTION UNDER THIS SECTION T AKE THE AMOUNT OF PROFITS AS MAY BE REASONABLY DEEMED TO HAVE BEEN DE RIVED THEREFROM: PROVIDED THAT IN CASE THE AFORESAID ARRANGEMENT INVOLVES A SPECIFIED DOMESTIC TRANSACTION REFERRED TO IN SECTI ON 92BA THE AMOUNT OF PROFITS FROM SUCH TRANSACTION SHALL BE DE TERMINED HAVING REGARD TO ARM'S LENGTH PRICE AS DEFINED IN CLAUSE ( II) OF SECTION 92F . (11) THE CENTRAL GOVERNMENT MAY AFTER MAKING SUCH INQUIRY AS IT MAY THINK FIT DIRECT BY NOTIFICATION IN THE OFFIC IAL GAZETTE THAT THE EXEMPTION CONFERRED BY THIS SECTION SHALL NOT APPLY TO ANY CLASS OF INDUSTRIAL UNDERTAKING OR ENTERPRISE WITH EFFECT FR OM SUCH DATE AS IT MAY SPECIFY IN THE NOTIFICATION. (12) WHERE ANY UNDERTAKING OF AN INDIAN COMPANY WHI CH IS ENTITLED TO THE DEDUCTION UNDER THIS SECTION IS TRANSFERRED BEFORE THE EXPIRY OF THE PERIOD SPECIFIED IN THIS SECTION TO ANOTHER INDIAN COMPANY IN A SCHEME OF AMALGAMATION OR DEMERGER (A) NO DEDUCTION SHALL BE ADMISSIBLE UNDER THIS SE CTION TO THE AMALGAMATING OR THE DEMERGED COMPANY FOR THE PREVIO US YEAR IN WHICH THE AMALGAMATION OR THE DEMERGER TAKES PLA CE; AND 16 ITA NO. 6196 & 6197/DEL./2016 (B) THE PROVISIONS OF THIS SECTION SHALL AS FAR A S MAY BE APPLY TO THE AMALGAMATED OR THE RESULTING COMPANY AS THEY WO ULD HAVE APPLIED TO THE AMALGAMATING OR THE DEMERGED CO MPANY IF THE AMALGAMATION OR DEMERGER HAD NOT TAKEN PLACE. (12A) NOTHING CONTAINED IN SUB-SECTION (12) SHALL A PPLY TO ANY ENTERPRISE OR UNDERTAKING WHICH IS TRANSFERRED IN A SCHEME OF AMALGAMATION OR DEMERGER ON OR AFTER THE 1ST DAY OF APRIL 2007. 4.11 HERE IN THE INSTANT CASE SECTION 80IA(8) AND 80IA (10) OF THE ACT ARE RELEVANT TO FIND OUT THE REASON OF THE ABNO RMAL PROFIT AND EXAMINE WHETHER THE ASSESSEE HAS SHIFTED PROFIT OR EXPENDITURE TO ELIGIBLE BUSINESS OR TO ANY OTHER BUSINESS CARRIED ON BY THE ASSESSEE OR SHIFTED PROFIT OR EXPENDITURE TO ANY OT HER PERSON. 4.12 THE LD. CIT(A) IN PARA 5.6.3 OF THE IMPUGNED ORDE R HAS MENTIONED THAT THE ASSESSING OFFICER HAS NOT COMMEN TED IN REMAND REPORT ON THIS ISSUE. THE LD. CIT(A) HOWEVE R ON THE BASIS OF THE FINANCIAL STATEMENTS AND DISCUSSION WI TH THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE HELD THAT THERE WAS NO OTHER BUSINESS WHICH WAS CARRIED OUT BY THE ASSESSE E COMPANY AND THEREFORE THERE WAS NO REASON TO GO INTO THE ISSUE OF DERIVING MORE THAN ORDINARY PROFIT WHICH MIGHT BE E XPECTED TO ARISE IN THE ELIGIBLE BUSINESS. THE LEARNED CIT(A) DID NOT CALL FOR REPORT OR COMMENT FROM THE ASSESSING OFFICER ON THE SPECIFIC SUBMISSION OF AUTHORIZED REPRESENTATIVE. IN OUR OPI NION FOR APPLICATION OF SECTION 80-IA(8) AND 80-IA(10) THE LD. CIT(A) WAS REQUIRED TO EXAMINE ALL THE EXPENSES INCURRED BY TH E ASSESSEE FOR ASCERTAINING SHIFTING OF ANY EXPENSES TO ANY OTHER BUSINESS OF THE ASSESSEE OR TO ANY OTHER CONCERN. FROM THE FINDING OF THE LD. CIT(A) IT CANNOT BE ASCERTAINED THAT HE HAS EXAMIN ED THE EXPENSES AS PER THE REQUIREMENT OF THE SECTION 80IA (8) OR 80IA(10) 17 ITA NO. 6196 & 6197/DEL./2016 OF THE ACT. THE LD CIT(A) IS HAVING COTERMINOUS POW ER OF THE ASSESSING OFFICER AND THUS HE WAS REQUIRED TO EXA MINE THIS ISSUE THOROUGHLY. IN VIEW OF THE FACTS OF THE CIRCU MSTANCES OF THE CASE AND IN THE INTEREST OF THE SUBSTANTIAL JUSTICE WE FEEL IT APPROPRIATE TO RESTORE THIS ISSUE BACK TO THE FILE OF THE ASSESSING OFFICER FOR DECIDING APPLICABILITY OF SECTION 80IA( 8) AND 80IA(10) OF THE ACT OVER THE AFFAIRS OF THE ASSESSEE. 4.13 THE GROUNDS RAISED BY THE REVENUE IN BOTH THE APP EALS ARE ACCORDINGLY ALLOWED FOR STATISTICAL PURPOSES 5. IN THE RESULT BOTH APPEALS OF THE REVENUE ARE ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH FEBRUARY 2020. SD/- SD/- (AMIT SHUKLA) (O.P. KANT) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28 TH FEBRUARY 2020. RK/- (D.T.D.S.) COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR ITAT NEW DELHI