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4.1 Ground No. 2 of the appeal of the assessee is regarding reallocation of expenses from Pimpri unit to Chakan unit for the purpose of deducting Under Section 80-IA. The assessee had taken the expenses of Chakan unit, being the eligible unit at Rs. 40,11,896. The details are given on page 5 in Table - 1 of the appellate order. The AO computed the expenses of Chakan unit at Rs. 59,47,398/-. given in Table - 2 on page 6 of the appellate order. The case of the AO was that the assessee inflated expenses of Pimpri unit with a view to claim higher deduction in respect of eligible unit. It was submitted to him that all indirect expenses had been allocated on turnover basis. The directors' remuneration was allocated on time basis, which was equal for both the units. The direct expenses had been debited on actual basis. However, the AO reallocated all the expenses on turnover basis, leading to decrease in profits of the eligible unit by an amount of Rs. 19,35,502/-. It was represented before the learned CIT(A) that certain expenses, namely, wages, incentives, consumables, octroi, packing and forwarding, transport and freight. ESI. PF. bonus, and staff welfare expenses were direct expenses and the work related to one or the other unit. Therefore, in respect of such expenses, there was no question of reallocation as they had been debited on actual basis. It was also represented that separate books of account have been maintained for the units and in view thereof reallocation made by the AO was not sustainable at all. The learned CIT(A) considered the submissions. He agreed with the assessee that there was no need to reallocate direct expenses as such expenses were identifiable with one or the other unit and had been debited in the respective units on actual basis. There were certain expenses of the head office such as salary, printing and stationery, telephone expenses, vehicle expenses, which were common to both the units. Therefore, he came to the conclusion that such expenses should be allocated on turnover oasis between the two units. He was also of the view that it will be fair to allocate the directors' remuneration on the basis of turnover as higher turnover would require more attention of the management. The assessee furnished the working of reallocation of all the expenses as per the aforesaid directions of the learned CIT(A). The expenses have been tabulated by the learned CIT(A) in Table - 3 on page 6 of the order. The expenses aggregating to Rs. 46,12,019/- were allocated to Chakan unit. The AO was directed to compute deduction Under Section 80-IA on this basis, which came to Rs. 4,23,224/-.