Dy. CIT vs Gail (India) Ltd
The assessee is engaged in business of production/processing transmission and distribution of various gases. The assessee claimed deduction under Sections 80HH, 80I and 80IA of the Income Tax Act, 1961 and other expenses which were disallowed by the Assessing Officer. The Tribunal admitted the aforementioned additional evidence and directed the AO to decide the issue afresh. Thereafter, the AO has passed the present assessment order u/s 143(3)/254.
The CIT(A) accepted that benefit of deduction under Section 80I/ 80IA is admissible on Lean gas manufactured/produced, but held that such deduction is admissible at the stage of two LPG plants. The CIT(A) held that activities undertaken by the assessee at its customer terminals did not constitute “manufacture or production of any article or thing” so as to be eligible for deduction. The contention of the assessee is that the claim of deduction made by the assessee under section 80I/80IA/ 80HH are genuine as the similar claims have been allowed in the earlier years by the revenue. Since deduction under section 80IA in respect to profit derived from eligible units has been allowed by Revenue before, the same cannot be denied subsequently. Thus, the claim of deduction made by the assessee under section 80I/80IA/ 80HH are genuine. In result, appeal of the assessee is partly allowed and the appeal of the revenue is dismissed.