LAWS(ALL)-2014-10-224

COMMISSIONER OF INCOME TAX, MEERUT Vs. TRANSLAM LTD

Decided On October 17, 2014
Commissioner of Income Tax, Meerut Appellant
V/S
Translam Ltd Respondents

JUDGEMENT

(1.) BOTH the appeals have been filed by the department against the consolidated order dated 26.08.2004, passed by the Income Tax Appellate Tribunal, New Delhi in I.T.A. No.1769 & 1770/Del/2001 for the assessment years 1996 -97 & 1997 -98.

(2.) ON 26.08.2009, both the appeals were admitted by a Co -ordinate Bench on the following substantial question of law: -

(3.) THE brief facts of the cases are that, during the assessment year under consideration, the assessee company set up a new unit at Sansarpur Terrace, District -Kangra, (Himachal Pradesh), for manufacture and sale of Lamination tordials cores and transformers etc. It was claimed by the assessee that said unit is located in industrially backward area therefore the profits and gains of the said unit are eligible for 100% deduction under Section -80IA of the Income Tax Act. For the purpose, the component of income includes the interest income earned by the assessee company on account of charge of overdue interest from customers to whom sales were executed from Himachal unit on account of late payment of their dues and also towards bank interest. The total claim for the deduction under Section -80 IA was at Rs. 65,24,023/ -, but the A.O. has allowed partial deduction of Rs. 25,93,772/ -. The remaining amount was disallowed by the A.O. and the same was upheld by the First Appellate authority. However, the Tribunal has allowed entire claim of the assessee. Being aggrieved, the department has filed the present appeal.