This appeal is by Revenue challenging order of learned CIT(A), dt. 8th March, 2004 on following grounds: "1. On basis of facts and circumstances of case, learned CIT(A) has erred in law and on facts in directing AO to allow depreciation at normal rates on amounts of Rs. 3 lakhs and Rs. 12 lakhs surrendered on account of additional investment/income in building and machinery, respectively, when investment in these two assets was credited in books of account on 10th March, 2000 which meant that assessee became owner of said two assets to extent of Rs. 15 lakhs only on 10th March, 2000. On facts and in circumstances of case, learned CIT(A) has erred in law and on facts in directing AO to allow deduction under s. 80-IB, s assessee had not been able to prove that machinery of Rs. 15.86 lakhs installed in his business premises was new machinery and same was not put to use before installation in his premises. That order of learned CIT(A) be set aside and that of AO be restored. That appellant craves leave to add or amend any ground of appeal at time of hearing." assessee declared income of Rs. 8,90,370 in its return filed on 30th Oct., 2000. assessee derived income from job work and rent of machinery. Survey under s. 133A was conducted on 9th March, 2000 at business premises of assessee. During survey, assessee made surrender of Rs. 3 lakhs in building account and sum of Rs. 12 lakhs in plant and machinery account. Authorised Representative of assessee attended assessment proceedings from time-to-time and filed required informations before AO. assessee claimed deduction under s. 80-IB of Act. assessee was asked to produce necessary evidence regarding installation of machinery to which assessee relied upon statement of his brother, Mr. Dalip Madan, who is partner in M/s Madan Udyog. As per AO, assessee has not produced any voucher for paying labour on account of fabrication of machinery. total value of machinery was Rs. 15,86,308. As per assessment order, assessee did not prove that machinery of Rs. 15.86 lakhs installed at t h e premises is new machinery and same was not put to use before installation at premises. surrendered amount was credited in P&L a/c under head miscellaneous income . As per AO, in order to claim deduction under s. 80-IB, income should be directly generated from business, and thus, miscellaneous income surrendered by assessee cannot be said to be derived from business of industrial undertaking. As per AO since assessee has not produced evidence regarding purchase of new machinery as well as income generated from such business of industrial undertaking, assessee is not entitled to deduction under s. 80-IB. assessment order was carried in appeal before learned CIT(A) where it was partly allowed. Now, Revenue is aggrieved and is in appeal before Tribunal. During arguments, we have heard Mrs. Sukhwinder Khanna, learned Departmental Representative for Revenue, and Sh. D.K. Gupta and Sh. Tej Mohan Singh, learned advocates for assessee. gist of arguments on behalf of Revenue in nutshell is that assessee made surrender of Rs. 12 lakhs for machinery and there is total surrender of Rs. 15 lakhs which is negative income. assessee did not produce any proof of income with assessee. It was also contended that assessee did some job work. Mrs. Sukhwinder Khanna pointed out that stamp paper itself was purchased on 12th Nov., 1999 and it is merely undisclosed income of assessee. assessee cannot get depreciation and assessment order was relied upon by contending that depreciation is not allowable. On issue of s. 80-IB, it was contended that onus is on assessee to prove that income was derived from machinery as s. 80-IB is specific section, no benefit of doubt can be extended. On other hand, learned counsel for assessee contended that machinery was installed earlier, voucher was produced and it was let out to his brother w.e.f. 1st October and even trial run qualifies for depreciation. In nutshell, order of learned CIT(A) was supported. On issue of s. 80-IB, it was contended that industrial activity was carried out by assessee, thus, order of learned CIT(A) was supported. Mrs. Sukhwinder Khanna again contended that there is no evidence of any income from machinery. We have considered rival submissions. After hearing rival submissions and on perusal of record, it seems that only issue before us is whether full depreciation is allowable or 50 per cent. Another point for our consideration is that how date of installation can be ascertained. At p. 4 of paper book of assessee, income and expenditure account for period ending 31st March, 2000 has been placed by assessee in which Rs. 20,830 has been shown from job work, Rs. 24,000 by rent of machinery and Rs. 15 lakhs as miscellaneous business income. On perusal of p. 7, which is rent agreement executed on 12th day of November, 1999 between M/s Madan Udyog, Manohar Colony, Jagadhri, and assessee Sh. Rajiv Kumar Madan, proprietor of M/s Rajiv Udyog, it is seen that stamp paper itself was purchased on 12th Nov., 1999 whereas rent period of 11 months has been shown from 1st Oct., 1999 to 10th Sept., 2000 at monthly rent of Rs. 8,400. In our considered opinion, it seems this rent agreement is manipulated one when paper itself was purchased on 12th Nov., 1999, then how rent period can be from 1st Oct., 1999 to 10th Sept., 2000. assessee has not produced any concrete evidence that asset was actually given on rent on 1st Oct., 1999. At same time, surrender has been credited by assessee in P&L a/c under head "miscellaneous income". We agree with contention of learned Departmental Representative that in order to avail deduction under s. 80-IB of Act, income should be directly generated from industrial activity and miscellaneous income cannot be said to be derived from business of industrial activity. income derived from industrial activity cannot have wide import so as to include income which can in some manner b e attributed to business. derivation of income must be directly connected with business in sense that income is generated by business. For this proposition, we are fortified by decision pronounced in case of CIT vs. Cochin Refineries Ltd. (1982) 27 CTR (Ker) 147: (1982) 135 ITR 278 (Ker) and CIT vs. Cement Distributors Ltd. (1994) 119 CTR (Del) 496: (1994) 208 ITR 335 (Del). In order to entitle to benefit, following facts have to be established by assessee, subject always to time schedule in provision: (a) Investment of substantial fresh capital in industrial undertaking set up. (b) Employment of requisite labour therein. (c) Manufacture or production of article in said undertaking. (d) Above all separate and distinct identity of industrial unit set up. In present case, assessee has made surrender of Rs. 3 lakhs in building account and Rs. 12 lakhs under head plant and machinery on 9th March, 2000 and assets were credited in books of account on 10th March, 2000. From record, it is seen that no income has been shown from April to September, 1999. assessee itself has shown earning of Rs. 24,000 only from job work. In that situation, how assessee can earn such substantial amount. At same time, assessee has not produced any voucher for paying labour charges, etc. on account of fabrication of machinery. assessee has not produced any evidence that machinery of Rs. 15.86 lakhs installed at premises was new machinery and same was put to use after installation in premises. Before authorities below, assessee merely produced 2 vouchers/invoice of total amount of Rs. 3,22,999, dt. 9th April, 1999 and Rs. 1,31,070 dt. 18th May, 1999. assessee has not shown any labour charges or fabrication charges for installation, if any, done by assessee. During arguments, learned counsel for assessee invited our attention to statement of one Sh. Dalip Madan, partner of M/s Madan Udyog wherein it has been admitted that construction of building and machinery is new and there is mention of rent agreement on non-judicial stamp paper. As we have discussed in preceding paras that stamp paper was purchased on 12th Nov., 1999, statement is self-serving document. In view of these facts, full depreciation cannot be allowed to assessee. We reverse order of learned CIT(A). In result, appeal of Revenue is allowed. *** ASSISTANT COMMISSIONER OF INCOME TAX v. RAJIV KUMAR MADAN