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A company is having two units manufacturing  different products. ABC unit started production in A.Y.2005-06 and  was eligible for deduction u/s 80IB. XYZ unit started production in A.Y.2008-09 and was eligible for deduction u/s 80IB. In Previous year relating to A.Y.2010-11.ABC unit incurred a loss of 10 lacs and in XYZ unit there was a of profit 20 lacs.Company is   also having non 80IB units where in there was a profit of 50 lacs.Company filed return as under:-
Profit of Non 80IB Units         50
Loss ABC unit                       -10
Profit XYZ unit                        20
GTI                                         60 
Deduction u/s 80IB                20
Total Income                          40
However A.O.allowed deduction u/s Rs 10 i.e.20-10 being loss of ABC unit.
Will some one enlighten about the action of A.O.