Case Law Details
Brief of the Case
ITAT Chandigarh held In the case of M/s Shree Dhanwantri Herbals vs. The ITO that the careful reading of the form 10CCB, in a serial order would clearly show that the assessee is required to inform the location of the Industry and column (c) specifically ask the assessee to state whether business is a new business and Column (d) clearly ask the assessee whether existing business has under taken substantial expansion, therefore, there are two categories of business and substantial expansion is possible only in case of existing business. In our opinion, the CIT (A) has correctly adjudicated this issue. Hence assessee is entitled only deduction @ 25% as available to assessee in case of substantial expansion in later years, who has already availed full deduction u/s 80IC.
Facts of the Case
ITA NO. 501/Chd/2015
The Assessee derives income from the manufacturing and sale of herbal medicines. During the year under consideration the assessee firm had declared gross sales at Rs. 18,34,74,346/ -. The Assessing officer noticed that assessee was carrying out its business activity at two places one at Amritsar and the other at Kishanpura (Baddi ) , H.P. According to assessing officer, the profits derived from Kishanpura unit has been claimed as deduct ion u/s 80IC whereas no such deduction is available to the Amritsar unit of the assessee. The Assessing officer further noted that there was huge difference of GP and NP ratio in Amritsar and Kishanpura unit i.e. GP and NP ratio of Amritsar Unit was 43.62% and 1.63% as compared to Kishanpura unit having ratio of 52.21% and 11.99%. Considering the above facts, the Assessing officer invoked the provisions of section 80IC read with section 80IA (10) and considering that Kishanpura unit being a new unit should have incurred expenditure on technical know-how and goodwill.
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