Mono Steel (India) Ltd. Vs DCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that where Commissioner (Appeals) passed ex-parte order in violation of principles of natural justice, one more opportunity should be granted to assessee. Accordingly, matter restored back to CIT(A) for de-novo consideration.
Facts- The assessee is a company engaged in the business of Manufacturing and Resale of Angle Channels Ingots. During the course of assessment, the assessee had claimed deduction u/s. 80-IA in respect of it’s power plant division on which a very high net profit rate of 67.16% was declared. Accordingly, AO was of the view that the assessee had loaded more profits to the power plant unit, on which deduction u/s. 80-IA of the Act was claimed and assessee had reduced the profits of the steel plant, so as to evade taxes. AO noted that on being asked, the assessee failed to furnish distribution of expenses under the head “other expenses” to the unit on which 80-IA deduction was claimed (power plant unit) and the other unit on which no deduction was claimed (steel unit). Considering the turnover of the assessee, the Assessing Officer was of the view that 10% of the “other expenses” was attributable to unit on which deduction u/s. 80-IA of the Act was being claimed by the assessee. Since a sum of Rs. 20.98 crores had been shown as “other expenses” where 10% of these other expenses i.e. Rs. 2.09 crores were considered to be expenses made u/s. 80-IA of the Act, this amount of Rs. 2.09 crores was held to be attributable to such exempt unit and the same was disallowed and added to the total income of the assessee.
