Lincoln Pharmaceuticals Ltd., Ahmedabad V. The ACIT (OSD)-1, Range-4, Ahmedabad

CO 154/AHD/2013

• Counselvise Citation: [2014] 122 COUNSELVISE.COM (IT) 9801 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 1 month(s) 27 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 05-09-2014
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 27-08-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 09-07-2013
• Court: TRIBUNAL
• Department Lawyers: MK SINGH
• Assessee Lawyers: A C SHAH
• Keywords: Reopening of assessment; Depreciation; Tangible material; Difference of opinion; Corroborative evidences; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 80IB; 147; 148; 11

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD 0 00 0 0 00 0 , , , , ! '# ! '# ! '# ! '#, , , , $ $ $ $ BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ ././ ./ ITA NOS. 2687, 2688 & 2689/AHD/2010 ' (' ' (' ' (' ' ('/ // / ASSESSMENT YEARS 2003-04, 2004-05 & 2005-06 ACIT (OSD)-I, RANGE-4, AHMEDABAD. VS LINCOLN PHARMECEUTICALS LTD., 2 ND FLOOR, NIRAV COMPLEX, NARANPURA, AHMEDABAD. PAN: AAACL2711N (APPELLANT) (RESPONDENT) CO NOS. 153, 154 & 155/AHD/2013 ASSESSMENT YEARS 2003-04, 2004-05 & 2005-06 LINCOLN PHARMECEUTICALS LTD., 2 ND FLOOR, NIRAV COMPLEX, NARANPURA, AHMEDABAD. PAN: AAACL2711N V S ACIT (OSD)-I, RANGE-4, AHMEDABAD. (APPELLANT) (RESPONDENT) REVENUE BY : SHRI M.K. SINGH, SR. D.R. ASSESSEE(S) BY : SHRI A.C. SHAH, AR !) * #+/ // / DATE OF HEARING : 27/08/2014 ,-( * #+ / DATE OF PRONOUNCEMENT: 05/09/2014 . . . ./ // / O R D E R PER SHRI N.S. SAINI, ACCOUNTANT MEMBER: THESE ARE THE APPEALS FILED BY THE REVENUE AND CR OSS- OBJECTIONS FILED BY THE ASSESSEE AGAINST THE CONSOL IDATED ORDER OF THE ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 2 - COMMISSIONER OF INCOME TAX (APPEALS)-XX, AHMEDABAD DATED 12.07.2010 FOR ASSESSMENT YEARS 2003-04, 2004-05 AN D 2005-06. 2. THE ISSUE INVOLVED IN REVENUES APPEALS FOR ASS ESSMENT YEARS 2003-04, 2004-05 AND 2005-06 IS THAT THE LD. COMMISSIONER OF INCOME TAX(A)-XX, AHMEDABAD HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE ASSESSING OFFICER TO ALLOW DEDUCTION U/S. 80IB OF THE INCOME TAX ACT, 1961 AMOUNTING TO RS 38,07,493/- IN ASSESSMENT YEAR 2003-04, RS 37,13,631/- IN ASSESSMENT YEAR 200 4-05 AND RS 44,22,737/- IN ASSESSMENT YEAR 2005-06. 3. IN THE CROSS-OBJECTIONS, THE ASSESSEE HAS CHALL ENGED THE REOPENING OF THE ASSESSMENT BY RAISING THE FOLLOWIN G COMMON GROUNDS IN ALL THREE ASSESSMENT YEARS: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN HOLDING THAT THE REOPENING OF ASSESSMENT IS VALID IN AS MUCH AS THE REASSESSMENT PROCEEDINGS ARE BAD IN LAW SINCE: (A) THE NOTICE UNDER SECTION 148 HAS NOT STATED IN WHAT MANNER THE ASSESSEE HAS FAILED TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS FOR THE PURPOSE OF ASSESSMENT SINCE THE NOTICE IS ISSUED AFTER COMPLETION OF FOUR YEARS FROM 143(3) ASSESSMENT. (B) THE NOTICE UNDER SECTION 148 IS ISSUED, IT APPEARS, ON THE BASIS OF AUDIT QUERY. THERE IS NO TANGIBLE MATERIAL TO COME TO A CONCLUSION THAT THE INCOME HAS ESCAPED ASSESSMENT. 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE FILED RETURN OF INCOME CLAIMING DEDUCTION U/S. 80IB(10) O F RS 38,07,493/- IN ASSESSMENT YEAR 2003-04, RS 37,13,631/- IN ASSES SMENT YEAR 2004-05 AND RS 44,22,737/- IN ASSESSMENT YEAR 2005- 06. THE ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 3 - ORIGINAL ASSESSMENT WAS COMPLETED FOR ASSESSMENT YE AR 2003-04 U/S. 143(3) READ WITH SECTION 147 ON 30.01.2006, FO R ASSESSMENT YEAR 2004-05 U/S. 143(3) ON 18.12.2006 AND FOR ASSE SSMENT YEAR 2005-06 U/S. 143(3) ON 28.03.2007 WHEREIN THE CLAIM FOR DEDUCTION U/S. 80IB(10) WAS ALLOWED TO THE ASSESSEE. THEREAF TER, THE ASSESSING OFFICER ISSUED NOTICE U/S. 148(2) OF THE ACT FOR ASSESSMENT YEAR 2003-04 ON 12.06.2009, FOR ASSESSMENT YEAR 200 4-05 ON 17.03.2009 AND FOR ASSESSMENT YEAR 2005-06 ON 17.03 .2009 FOR FOLLOWING REASONS: AN INDUSTRIAL UNDERTAKING COMMENCING OPERATION ON O R AFTER 01-04-1995 CAN CLAIM DEDUCTION U/S. 80IB ONLY IF IT IS A SMALL SCALE INDUSTRIAL UNDERTAKING. THE ASSES SEE COMPANY COMMENCED OPERATION AFTER 15-09-1997 I.E. AFTER 31-03-1995. AS DEFINED BY SECTION 11 OF INDU STRIAL (DEVELOPMENT & REGULATION) ACT, 1951 AND AMENDED VI DE SO 857(E) DATED 10-12-1999, SMALL SCALE & INDUSTRIA L UNDERTAKING IS AN INDUSTRIAL UNDERTAKING IN WHICH T HE INVESTMENT IN THE FIXED ASSETS IN PLANT & MACHINERY DOES NOT EXCEED RS 1 CRORE. AS PER SCHEDULE 5 TO THE BALANCE SHEET, THE TOTAL V ALUE OF PLANT & MACHINERY WAS CERTIFIED AT RS 4,73,81,571/- AS ON 01-04-2002 I.E. AT THE BEGINNING OF THE FINANCIAL Y EAR 2002-03 RELEVANT TO AY 2003-04, RS 4,80,33,282/- AS ON 01-04-2003 I.E. AT THE BEGINNING OF THE FINANCIAL Y EAR 2003-04 RELEVANT TO AY 2004-05, AND RS 4,97,88,775/ - AS ON 01-04-2004 I.E. AT THE BEGINNING OF THE FINAN CIAL YEAR 2004-05 RELEVANT TO AY 2005-06 WHICH EXCEEDED THE LIMIT FIXED FOR INVESTMENT IN PLANT AND MACHINERY A ND THEREBY THE ASSESSEE CEASED TO BE AN SSI UNIT AND T HUS NOT ELIGIBLE FOR DEDUCTION U/S. 80IB OF THE ACT. H OWEVER, THE ASSESSEE CLAIMED AND WAS ALLOWED DEDUCTION U/S. 80IB OF THE ACT OF RS 35,40,963/-, RS 37,13,631/- A ND RS 44,22,737/- FOR ASSESSMENT YEARS 2003-04, 2004-05 A ND 2005-06 RESPECTIVELY. THUS, THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE INCOME TAX ACT, 1961. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 4 - 5. THE ASSESSMENT FOR ALL THREE ASSESSMENT YEARS W AS COMPLETED ON 29.10.2009 WHEREIN THE DEDUCTION ALLOW ED TO THE ASSESSEE IN THE ORIGINAL ASSESSMENT U/S. 80IB(10) W AS WITHDRAWN. 6. BEING AGGRIEVED AGAINST THE SAID ORDERS OF THE ASSESSING OFFICER, THE ASSESSEE FILED APPEAL BEFORE THE COMMI SSIONER OF INCOME TAX (APPEALS) WHEREIN THE ASSESSEE SUBMITTED AS UND ER: THE LEARNED AO HAS REOPENED THE ASSESSMENT AND THE REBY HAS WITHDRAWN THE DEDUCTION AS UNDER GRANTED UNDER SEC.80IB ON THE GROUND THAT THE ASSESSEE IS NOT A SMALL SCAL E INDUSTRIAL UNDERTAKING (SSIU). A.Y. 2003-04 RS 38,07,493 A.Y. 2004-05 RS 37,13,631 A.Y. 2005-06 RS 44,22,731 EVEN OTHERWISE THE ASSESSEE IS A SSIU AND THEREFORE THE DEDUCTION UNDER SEC. 80IB WAS RIGHTLY ALLOWED. 2. REOPENING IS BAD IN LAW - CHANGE OF OPINION: 2.1 THE APPELLANT COMPANY COMMENCED THE PRODUCTION IN PHARMACEUTICAL DRUGS ON 15-09-1997 I.E. AFTER 31-03 - 1995. THE ASSESSEE IS ENTITLED TO DEDUCTION UNDER S EC. 80IB, IF IT IS SSIU AS PROVIDED IN SECTION 80IB(3)( II). THE DEDUCTION UNDER SECTION 80IB WAS GRANTED FROM A.Y. 1998-1999 ONWARDS. THE ASSESSMENT WAS FRAMED UNDER SEC. 143(1) FOR A.Y. 1999-2000. THEREAFTER, IT WAS REOPENED FOR THE PURPOSE OF DEDUCTION UNDER SEC.8OHHC AND THE ORDER WAS PASSED ON 30-09-2005 UNDER SEC. 80IB WAS ACCEPTED. SIMILARLY, THE DEDUCT ION WAS ALSO GRANTED FOR A.Y. 2001-2002 BY ORDER DATED 15- 03-2004 PASSED UNDER SEC.L43(3)(II) [PLEASE REFER P AGE- 5 OF THE ASST. ORDER]. 2.2 IT MAY PLEASE BE NOTED THAT THE AO ISSUED NOTIC E UNDER SEC.148 DATED 24-02-2009 FOR A.Y. 2003-2004 AND NOTICE UNDER SEC. 148 DATED 17-03-2009 ISSUED FOR A .Y. 2004-2005 AND 2005-2006. THE SATISFACTION THAT THE INCOME HAS ESCAPED ASSESSMENT WAS REACHED BY THE AO IN THE MONTH OF FEBRUARY-MARCH,2009. HOWEVER, THE ASSESSMENT WAS FRAMED BY ANOTHER AO WITHOUT RECORDING ANY SATISFACTION. IT MAY PLEASE BE NOTED THAT 1HE AO SIMPLY FURNISHED THE REASONS RECORDED BY LET TER ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 5 - DATED 04-08-2009 BUT HE DID NOT SATISFY HIMSELF ABO UT THE ESCAPEMENT OF INCOME ON THAT DATE. THEREFORE, WHEN THE SATISFACTION IS RECORDED BY ONE AO AND THE ACTION IS TAKEN BY ANOTHER AO, THE PROCEEDINGS ARE BAD IN LAW AS HELD BY GUJARAT HIGH COURT IN THE CASE OF HYNOUP FOOD & OIL INDUSTRIES V/S. ACIT 307 ITR 115. 2.3 DURING A.Y. 2003-2004, 2004-2005 & 2005-2006, T HE AO GRANTED THE DEDUCTION UNDER SEC. 80IB WHILE PASS ING THE ORDER DATED 30-01-2006 UNDER SEC. 143(3) R.W.S. 147 FOR A.Y. 2003-2004, WHILE PASSING THE ORDER DAT ED 18-12-2006 UNDER SEC. 143(3) FOR A.Y. 2004-2005 AND WHILE PASSING THE ORDER DATED 28-03-2007 UNDER SEC. 143(3) FOR A.Y. 2005-2006. THE REOPENING IS MADE AF TER THE LAPSE OF FOUR YEARS IN CASE OF A.Y. 2003-2004 I .E. AFTER 31 ST MARCH, 2008, THEREFORE THE REOPENING IS BAD IN LAW SINCE THE ASSESSEE FURNISHED ALL THE PARTICULAR S TRULY AND FULLY AT THE TIME OF REASSESSMENT AND THEREFORE THE ASSESSMENT CANNOT BE REOPENED AFTER FOUR YEARS AS PROVIDED IN PROVISO TO SECTION 147. SIMILARLY, THE ORDERS FOR A.Y. 2004-2005 AND 2005-2006 AND ALSO FOR A.Y, 2003-2004 ARE PASSED AFTER CONSIDERING THE CLAIM UN DER SEC. 80IB IN DETAILS [THE COPY OF ORDERS ARE ENCLOS ED]. THEREFORE, SINCE THE ASSESSEE IS ALLOWED THE DEDUCT ION UNDER SEC.8OIB BY ORDERS PASSED UNDER SEC, 143(3) I T IS NOTHING BUT CHANGE OF OPINION. THE SC IN CASE OF CIT V/S. KELVINATOR INDIA LTD. 320ITR 561HELD AS UNDER: 'THE CONCEPT OF CHANGE OF OPINION ON THE PART OF TH E AO TO REOPEN AN ASSESSMENT DOES NOT STAND OBLITERATED AFTER THE SUBSTITUTION OF SEC.147 OF THE I.T. ACT, 1961 BY DIRECT TAX LAWS (AMENDMENT) ACT, 1987 & 1989. AFTER THE AMENDMENT, THE AO HAS TO HAVE REASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT, BUT THIS DOES N OT IMPLY THAT THE AO CAN REOPEN AN ASSESSMENT ON MERE CHANGE OF OPINION. THE CONCEPT OF CHANGE OF OPINION MUST BE TREATED AS AN IN-BUILT TEST TO CHECK THE AB USE OF POWER. HENCE, AFTER APRIL 1, 1989, THE AO HAS POWER TO REOPEN AN ASSESSMENT, PROVIDED THERE IS TANGIBLE MATERIAL TO COME TO THE CONCLUSION THAT THERE WAS ESCAPEMENT OF INCOME FROM ASSESSMENT. REASON MUST HAVE A LINK WITH THE FORMATION OF THE BELIEF.' 2.4 THE ATTENTION IS DRAWN TO THE REASONS RECORDED FOR REOPENING THE ASSESSMENT. IT IS STATED IN THE REASO NS RECORDED THAT THE INVESTMENT LIMIT FOR SSI UNIT AS PER NOTIFICATION NO. SO 857(E) DATED 10 TH DECEMBER, 1997 IS RS. 1.00 CRORE AND THAT THE INVESTMENT IN PLANT & MACHINERY AS ON 31-03-2002 IS RS. 4.73 CRORE AND THEREFORE THE ASSESSEE IS NOT SSI UNIT AND THEREBY THE ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 6 - INCOME HAS ESCAPED ASSESSMENT. THE LEARNED AO FAILE D TO APPRECIATE 1HE NOTIFICATION NO. SO 857(E) DATED 10 TH DECEMBER, 1997. IN FACT, THE LIMIT AS PER THE SAID NOTIFICATION IS RS. 3.00 CRORE WHICH IS TO BE CALCU LATED AFTER EXCLUDING THE ITEMS OF MACHINERY REFERRED TO IN NOTE NO.2 OF THE SAID NOTIFICATION. IF THE CALCULAT ION IS MADE THEN THE ASSESSEE IS WELL WITHIN THE INVESTMEN T LIMIT, THEREFORE THE REOPENING IS BAD IN LAW. IN T HE PRESENT CASE, THERE IS NO TANGIBLE MATERIAL TO SHOW THAT THE ASSESSEE IS NOT A SSI UNIT. THE ABSOLUTE FIGURE S STATED IN THE BALANCE SHEET ARE OF NO RELEVANCE. TH E CALCULATION HAS TO BE DONE AS PER THE NOTIFICATION NO. SO 857(E) DATED 10 TH DECEMBER, 1997. EVEN IF THERE IS SOME MATERIAL IT IS NOTHING BUT A CHANGE OF OPINION THEREFORE, THE REASSESSMENT IS BAD IN LAW. 3. MERITS: 3.1 THE ASSESSEE IS A PHARMACEUTICAL DRUG MANUFACTU RING COMPANY. THE COMPANY STARTED MANUFACTURING AT KHATRAJ FROM 15-09-1997. THE ASSESSEE IS ENTITLED T O DEDUCTION U/S 80IB IF IT IS SMALL SCALE INDUSTRIAL UNDERTAKING COMMENCING PRODUCTION AFTER 31/03/1995 AS PROVIDED IN SECTION 80IB(3)(II). THE ASSESSEE IS A SMALL SCALE INDUSTRIAL UNDERTAKING AND THEREFORE TH E DEDUCTION U/S. 80IB WAS GRANTED FROM A.Y.1998-1999 ONWARDS. HOWEVER, THE DEDUCTION UNDER SEC. 80IB IS WITHDRAWN ON THE GROUND THAT THE ASSESSEE IS NOT A SMALL SCALE INDUSTRIAL UNDERTAKING BY REOPENING THE ASSESSMENT FOR A.Y.2003-2004, 2004-2005 AND 2005- 2006. 3.2 SECTION 80IB(14)(G) DEFINES SMALL SCALE INDUSTR IAL UNDERTAKING AS UNDER: 'SMALL-SCALE INDUSTRIAL UNDERTAKING' [SSIU] MEANS A N INDUSTRIAL UNDERTAKING WHICH IS, AS ON THE LAST DAY OF THE PREVIOUS YEAR, REGARDED AS A SMALL SCALE INDUSTRIAL UNDERTAKING UNDER SECTION 11B OF THE INDUSTRIAL (DEVELOPMENT AND REGULATION) ACT, 1951. 3.3 IT MAY PLEASE BE SEEN FROM THE DEFINITION THAT THE SSIU IS THAT INDUSTRIAL UNDERTAKING WHICH IS REGARDED AS SSIU UNDER SECTION 11B OF THE INDUSTRIAL (DEVELOPMENT AN D REGULATION) ACT, 1951. IT THEREFORE FOLLOWS THAT IF ANY INDUSTRIAL UNDERTAKING IS REGISTERED AS A SSIU BY D ISTRICT INDUSTRIES CENTRE, MEHSANA THEN IT IS A SSIU. THE CERTIFICATE OF REGISTRATION DATED 01-07-1998 ISSUED BY DISTRICT INDUSTRIES CENTRE, MEHSANA AND REVALIDATED ON 25-07-2002 BY DISTRICT INDUSTRIES CENTRE, GANDHINAG AR IS ENCLOSED HEREWITH. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 7 - THE ASSESSEE FURNISHED THE REGISTRATION CERTIFICATE FROM DISTRICT INDUSTRIES CENTRE AS SSIU TO THE AO DURING ASSESSMENT PROCEEDINGS. THE LEARNED AO CANNOT EMBARK UPON THE INQUIRY ABOUT THE GENUINENESS OF CERTIFICATE ISSUED BY ANOTHER CENTRAL GOVERNMENT AUTHORITY. THE RELIANCE IS PLACED IN FOLLOWING CASE S: APOLLO TYRES LTD. V/S. CIT 255 ITR 273 (SC) VADILAL CHEMICALS LTD. V/S. STATE OF ANDHRA PRADESH AND OTHERS. 142 STC 76 (SC) MALAYALA MAMORAMA CO. LTD. V/S. CIT 300 ITR 251 (SC ) ONCE THE ONE AUTHORITY OF CENTRAL GOVERNMENT HAS ISSUED CERTIFICATE AS SSIU, ANOTHER AUTHORITY CANNO T EMBARK UPON THE INQUIRY ABOUT THE GENUINENESS OF TH E CERTIFICATE. THIS VIEW IS HELD BY THE SC IN CASE OF APOLLO TYRES LTD. V/S. CIT 255 ITR 273. THE SC IN CASE OF VADILAL CHEMICALS LTD. V/S. STATE OF ANDHRA PRADESH AND OTHERS 142 STC 76 (SC) HAS RECENTLY HELD THAT THE DEPT. OF INDUSTRIES & COMMERCE HAVING EXERCISED ITS MIND AND HAVING GRANTED THE FINAL ELIGIBILITY CERTI FICATE, THE COMMERCIAL TAX DEPARTMENT COULD NOT GO BEHIND I T. THE SC WHILE DECIDING THIS CASE HAS FOLLOWED THE RA TIO LAID DOWN BY THE SC COURSE IN CASE OF APOLLO TYRES LTD. 255 ITR 273. WITHOUT PREJUDICE TO WHATEVER STATED ABOVE, THE INVESTMENT LIMIT OF PLANT & MACHINERY IS FIXED BY MINISTRY OF COMMERCE AND INDUSTRIES FROM TIME TO TI ME FOR TREATING THE INDUSTRIAL UNDERTAKING AS SMALL SC ALE INDUSTRIAL UNDERTAKING IS GIVEN IN THE TABLE BELOW- SR. NO. NOTIFICATION NO. REFERENCE TO PAGE NO. OF ASSESSMENT ORDER INVESTMENT LIMIT RS. EXCLUSION 1. 857(E) DATED 10/12/1997 7 3 CRORE AS PER NOTE NO.2 (PAGE NO .8 OF THE ASSESSMENT ORDER) 2. 1288(E) DATED 24/12/99 12 REDUCE TO RS. 1 CRORE DO 3. 4(I)-2000-SSI DATED 14/03/2000 6/12 LIMIT OF 3 CRORE WILL CONTINUE IF THE UNIT HAS INCREASED THE LIMIT UP TO RS 3 DO ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 8 - CRORE AS PER NOTIFICATION NO 857(E) DATED 10/12/1997 4. S0655(E) DATED 05/06/2003 12 5 CRORE DO 5 14-01-2005 [CLARIFICATION] 12 5 CRORE DO THE COPIES OF THE NOTIFICATIONS REFERRED TO IN TABL E ARE ENCLOSED. 3.5 IT MAY NOW PLEASE BE SEEN FROM THE NOTIFICATION S AND TABLE GIVEN HEREIN ABOVE THAT THE UNDERTAKING WHICH IS REGISTERED AS SSI U/S. 11B OF THE IDR ACT AS ON THE LAST DAY THE PREVIOUS YEAR SHALL BE ENTITLED FOR DEDUCTI ON U/S. 80IB(3)(II), SUBJECT TO INVESTMENT WITHIN THE PRESCRIBED LIMITS AS PER THE SAID ACT. 3.6 AS PER NOTIFICATION NO. SO 857(E) DATED 10 TH DECEMBER, 1997 THE UNDERTAKING IS REGARDED AS SMALL SCALE INDUSTRIAL UNDERTAKING IF THE INVESTMENT IN FIXED A SSETS IN PLANT AND MACHINERIES DOES NOT EXCEEDS RS.3.00 CRORE. NOTE NO.2 OF THE SAID NOTIFICATION ALSO GIVE S THE METHODOLOGY FOR CALCULATING THE VALUE OF PLANT AND MACHINERIES. SUBSEQUENTLY, THE GOVERNMENT ISSUED A NOTIFICATION NO. SO 1288(E) DATED 24 TH DECEMBER, 1999 REDUCING THE LIMIT OF INVESTMENT IN PLANT AND MACHINERY FOR BEIN G REGARDED AS SSI FROM RS.3.00 CRORE TO RS.1.00 CRORE . SUBSEQUENTLY A CLARIFICATION NO. 4(I)-2000-SSI WAS ISSUED ON 14 TH MARCH, 2000 STATING THAT THE UNITS THAT HAVE OBTAINED PERMANENT REGISTRATION ON THE ORDER DATED 10 TH WOULD CONTINUE TO REMAINING AN SSI INSPITE OF THE ORDER DATED 24 TH DECEMBER, 1997 REDUCING THE INVESTMENT LIMIT TO RS. 1.00 CRORE. THE COPY OF THE NOTIFICATION AND CLARIFICATION IS ENCLOSED. SUBSEQUENTLY, A NOTIFICATION DATED 5 TH JUNE, 2003 BEARING NO. SO 655(E) WAS ISSUED, BY VIRTUE OF WHIC H CERTAIN ITEMS UNDER DRUGS AND PHARMACEUTICAL CATEGO RY WERE INCLUDED AND UNDER WHICH THE INVESTMENT LIMIT WAS INCREASED UPTO RS.5.00 CRORES. ONE OF THE ITEMS WAS PARACITAMOLE OR PARA AMINO PHENOL. THE COMPANY MANUFACTURES ALL THE ITEMS PRESCRIBED UNDER DRUGS A ND PHARMACEUTICAL SECTOR UNDER THIS NOTIFICATION AND ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 9 - THEREFORE WAS GOVERNED BY THIS NOTIFICATION AND THEREFORE LIMIT FOR BEING REGARDED AS SSI UNDERTAKI NG STANDS INCREASED UPTO RS.5.00 CRORES. SUBSEQUENTLY, AGAIN A CLARIFICATION WAS ISSUED ON 14 T JANUARY, 2005 STATING THAT THE GOVERNMENT HAS APPROVED ENHANCEMEN T IN PLANT AND MACHINERY IN RESPECT OF ITEMS BEING MANUFACTURED IN DRUGS AND PHARMACEUTICALS SECTOR IN SSI FROM RS.1.00 CRORE TO RS. 5.00 CRORE. THE COPY OF THE SAID CLARIFICATION IS ENCLOSED. 3.7 THUS, THE COMPANY IS REGARDED AS SSI UNIT MANUFACTURING THE ITEMS IN DRUGS AND PHARMACEUTICAL S SECTOR IF THE INVESTMENT IN PLANT AND MACHINERY IS: (I) NOT EXCEEDING RS. 3.00 CRORE UPTO 5 TH JUNE, 2003; (II) NOT EXCEEDING RS. 5.00 CRORE FROM 5 TH JUNE, 2003 TILL 26 TH MARCH, 2009 (THE DATE ON WHICH SSI STATUS IS SURRENDERED) 3.8 THE INVESTMENT: IN PLANT & MACHINERY AS PER TH E METHODOLOGY OF CALCULATION GIVEN IN NOTIFICATION DA TED 10TH DECEMBER, 1997 FOR THE FINANCIAL YEAR ENDED ON 31 ST MARCH, 2003, 31ST MARCH, 2004 AND 31 ST MARCH, 2005 IS GIVEN BELOW. THE STATUS OF SSI AND THE INVESTMENT THEREOF NEEDS TO BE SEEN AS ON THE LAST DAY OF THE PREVIOUS YEAR AS PER THE DEFINITION OF SSI U /S. 80IB(14)(G). IT MAY PLEASE BE SEEN THAT THE INVESTMENT IN PLANT AND MACHINERY AS ON 31ST MARCH, 2003 WAS RS. 272.3 LACS , AS ON 31 ST MARCH, 2004 WAS RS. 282.82 LACS AND IT WAS RS. 307.08 LACS AS ON 31 ST MARCH, 2005. 3.9 IT MAY ALSO BE NOTED AS PER NOTE 2 OF THE NOTIF ICATION DATED 10 TH DECEMBER, 1997 THE COST OF GENERATION SET, TRANSFORMERS, COST INVOLVED IN INSTALLATIONS OF CAB LE, WIRINGS, ELECTRIC CONTROL PANEL, CIRCUIT BREAKERS N EEDS TO BE EXCLUDED WHILE CALCULATING THE VALUE OF INVESTME NT IN PLANT AND MACHINERY FOR BEING REGARDED AS SSI UNDERTAKING. THEREFORE, THE COST OF ELECTRIC INSTAL LATION AS PER THE BALANCE SHEET WHICH INCLUDES ALL THIS IT EMS HAS NOT BEEN CONSIDERED FOR THE PURPOSE OF CALCULAT ING THE VALUE OF INVESTMENT IN PLANT AND MACHINERY. 3.10 FROM THE ABOVE, IT MAY BE SEEN THAT THE INVEST MENT VALUE IN PLANT AND MACHINERY FOR BEING REGARDED AS SSI UNDERTAKING IN DRUGS AND PHARMACEUTICALS SECTOR ARE WITHIN THE LIMIT PRESCRIBED UNDER THE ABOVE REFERRE D NOTIFICATIONS AND THEREFORE THE COMPANY CONTINUOUS TO BE AN SSI UNDERTAKING FOR THE ASSESSMENT YEAR 2003- ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 10 - 2004, 2004-2005 & 2005-2006. THUS THE COMPANY HAS RIGHTLY CLAIMED DEDUCTION U/S. 80IB IN THE RESPECTI VE YEARS AND THE CLAIM HAS BEEN RIGHTLY ALLOWED BY THE DEPARTMENT IN THE ASSESSMENT PROCEEDINGS UNDER SECTION 143(3).'' 4. THE VALUE OF PLANT AND MACHINERY FOR THE LAST 3 YEARS ARE GIVEN BELOW- LINCOLN PHARMACEUTICALS LTD. 31-03-2003 31-03-2004 31-03-2005 GROSS PLANT & MCHINAHY 480.33 497.88 516.93 EXEMPTED PLANT & MACHINARY REVALUATION OF MACHINERY 46.19 46.19 46.19 PRE OPERATIVE EXP. 11.46 11.46 11.46 R & D ASSETS 65.68 66.71 67.50 ERECTION & COMMISSONING 34.70 34.70 34.70 FREIGHT & PACKING 11.51 11.51 11.51 MOULD DIES & JIGS 26 26 26 D.G.SET 9.32 9.32 9.32 ET.P.PLANT 3.17 3.17 3.17 EXEMPTED ASSETS 208.03 205.06 209.85 NET PLANT & MACHINERY 272.30 288.82 307.08 SSI LIMIT 300 500 500 4.1 IT MAY PLEASE BE NOTED THAT THE PLANT &. MACHIN ERY AS ON 31-03-2002 WAS RS. 2.65 CRORE AS PER G.A. CERTIFICATE DATED 28-01-2003. THIS FIGURE ALSO COIN CIDES WITH THE CERTIFICATE OF REGISTRATION DATED 25-07-20 02 [RS.2,65,81,000 AS PER CERTIFICATE] ISSUED BY DISTR ICT INDUSTRIES CENTRE. THEREAFTER, THE ASSESSEE MADE ON LY NOMINAL ADDITIONS TO PLANT & MACHINERY A/C. AS UNDE R: ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 11 - FINANCIAL YEAR OPENING GROSS BLOCK [RS. IN CRORE] ADDITION [RS. IN LACS] SALES [RS. IN CRORE] CLOSING GROSS BLOCK [RS. IN CRORE] 2002-2003 4.73 6.51 NIL 4.80 2003-2004 4.80 17,55 MIL 4.98 2004-05 4.98 19.01 NIL 5.18 4.2 IT MAY PLEASE BE NOTED THAT THE GROSS BLOCK AS ON 31- 03-2002 WAS RS.4.73 CRORE AND AFTER EXCLUSION THE INVESTMENT IN PLANT & MACHINERY WAS RS.2.65 CRORE A S PER C.A. CERTIFICATE DATED 28-01-2003. THE CERTIFIC ATE OF REGISTRATION DATED 25-07-2002 ISSUED BY DISTRICT INDUSTRIES CENTRE ALSO STATES THE INVESTMENT IN PLA NT & MACHINERY AT RS. 2,55,81,000. IN OTHER WORDS, THE S AME IS BY AND LARGE IN AGREEMENT. AS STATED ABOVE, NOMI NAL ADDITION WAS MADE DURING A.Y. 2003-2004 TO 2005-200 6 AND AFTER EXCLUSION THE INVESTMENT IS BELOW THE LIM IT SPECIFIED AND STATED IN PARA 3.5 ABOVE. IN OTHER WO RDS, IF THE ASSESSEE IS REGARDED AS SSIU IN EARLIER YEAR S AS ACCEPTED BY THE DEPARTMENT, THE SAME STATUS SHOULD BE CONTINUED FOR A.Y. 2003-2004 TO 2005-2006 SINCE THE INVESTMENT IN PLANT & 5. OUR COMPANY IS A SSI UNIT ALL THREE RELEVANT ASSESSMENT YEARS. THE COMPANY HAS MADE MAJOR EXPANSION AT TRIMUL ESTATE, VILLAGE KHATRAJ, VADSAR ROAD, TAL. KALOL, DIST. GANDHINAGAR IN THE FINANCIA L YEAR 1997-1998. THE COMPANY HAS PROVIDED ALL THE FIXED ASSETS, DETAILS OF ADDITION DURING THE ASSESSMENT PROCEEDING 1998-1999. THE COMPANY IS GRANTED DEPRECIATION CLAIM AFTER VERIFICATION OF ALL ASSETS SUBMITTED BY THE COMPANY. THEREFORE, ALL THE DETAIL S OF PLANT & MACHINERY ARE ALREADY ON RECORDS. 5.1 IT MAY PLEASE BE NOTED THAT IN THE YEAR 2000, T HERE WAS A HEAVY RAIN OF 20 INCHES IN A DAY IN AHMEDABAD CIT Y AND OUR ALL MAJOR RECORDS OF THE COMPANY ARE REMAIN IN WATER FOR 3-4 DAYS, MAJORITY OF RECORDS ARE COMPLET ELY DESTROYED AND DAMAGED IN HEAVY RAINS. THIS FACTS, W E HAVE ALREADY INTIMATED TO THE INCOME TAX DEPARTMENT VIDE LETTER DATED 21 ST JULY, 2000. A COPY OF AFORESAID INTIMATION LETTER IS ENCLOSED. THE PHOTOGRAPHS OF L OGGING OF WATER ARE ENCLOSED. THE ORIGINAL INVOICE WAS ALREADY DESTROYED AND THER EFORE IT COULD NOT BE PRODUCED DURING REASSESSMENT PROCEEDINGS. HOWEVER, THE SAME WERE PRODUCED DURING ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 12 - A.Y. 1998-1999 ASSESSMENT PROCEEDINGS. THE FACT THA T THE DEPRECIATION CLAIM WAS ALLOWED PROVES THAT ALL THE INVOICES WERE PRODUCED AT THE RELEVANT TIME. 5.2 THE POSITION OF PLANT & MACHINERY AS ON 31/03/2 002 AS PER C. A. CERTIFICATE AS UNDER: GROSS PLANT & MACHINERY RS 47381372 (AS PER AUDITED BALANCE SHEET) LESS:-ASSETS NOT FOR 551 1. REVALUATION OF MACHINERY RS.4619150 2. R&D EQUIPMENT RS 6568174 3. PRE OPERATIVE EXPENSES RS.1146360 4. ERECTION & COMMISSIONING RS.3470000 5. FREIGHT & PACKING RS.1151000 6. MOULDS JIG, DIES RS.2600000 7. D.G.SET RS.932000 8. E.T.P. PLANT RS.317000 RS 20803684 NET AMOUNT FOR SSI PURPOSE RS 26577688 5.3 REVALUATION OF PLANT & MACHINERY OF RS. 46,19,1 50: THE COMPANY HAS MADE A REVALUATIORREF-PLANT-4T- MAEHINERY IN THE ASSESSMENT YEAR 1995-1996. AS A RESULT OF THE REVALUATION PLANT & MACHINERY, THE VA LUE OF MACHINERY IS INCREASED BY RS.46,00,190. FROM THE ORDER UNDER SECTION 250 OF THE INCOME TAX ACT,1961 IN THE ASSESSMENT YEAR 1995-1996. THE COPY OF ORDER IS ENCLOSED. 5.4 R & D EQUIPMENT OF RS. 65,68,174: THE COMPANY IS A RECOGNIZED IN-HOUSE R & D UNIT. TH E COMPANY HAVE MADE TOTAL INVESTMENT IN R & D EQUIPMENTS OF RS. 65,68,174 UP TO THE FINANCIAL YEA R 31/03/2002. THE YEAR WISE ADDITION SUMMARY DETAILS F OR R & D ASSETS ALONG WITH COPY OF ACCOUNT IS GIVEN HERE WITH FOR READY REFERENCE. SR. NO. FINANCIAL YEAR ASST. YEAR AMOUNT RS. REMARKS 1. 1995-1996 1996-1997 30,00,546 COPY OF A/C. ENCLOSED. 2. 1999-2000 2000-2001 4,11,624 DO 3. 2000-01 2001-02 4. 2001-02 2002-03 ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 13 - 5.5 PRE-OPERATIVE EXPENSES OF RS. 11,46,360: THE COMPANY HAS MADE MAJOR EXPANSION IN 1997-1998 AND INCURRED VARIOUS PREOPERATIVE EXPENSES LIKE ADMINISTRATIVE EXPENSES, LEGAL & REGISTRATION CHARG ES, CONSULTING FEES, INTEREST ON BORROWED FUND ETC. ALL THESE EXPENSES ARE PROPORTIONALLY ALLOCATED INTO ALL ASSE TS ACCOUNT IN THE PROPORTION OF VALUE OF ASSETS. THE SHARE OF ALLOCATION OF PREOPERATIVE EXPENSES IS RS 11,46, 360. THIS AMOUNT IS ALREADY DEBITED TO OUR PLANT & MACHI NERY ACCOUNT. A COPY OF PLANT MACHINERY ACCOUNT IS ENCLOSED. 5.6 D.G. SET OF 250 KVA OF RS 9,32,000: THE COMPANY HAS PURCHASED DIESEL GENERATING SET OF 250 KVA AT TOTAL COST OF RS 9,32,000 FOR WATER TREATMENT AS PER THE REQUIREMENT OF GUJARAT POLLUTI ON CONTROL BOARD. THE COPY OF EFFLUENT TREATMENT PLAN T ACCOUNT IN THE YEAR 1999-2000 IS ENCLOSED. 5.7 EFFLUENT TREATMENT PLANT (ETP) OF RS 3,17,000: THE COMPANY HAS SET UP AN EFFLUENT TREATMENT PLANT AT A TOTAL COST OF RS. 3,17,000 FOR WATER TREATMENT AS PER THE REQUIREMENT OF GUJARAT POLLUTION CONTROL BOARD. THE COPY OF EFFLUENT TREATMENT PLANT ACCOUNT IN THE YEA R 1999-2000 IS ENCLOSED. 5.8 ERECTION & COMMISSIONING OF RS. 34,70,000: THE COMPANY HAS MADE HUGE INVESTMENT IN EXPANSION UNIT. THE COMPANY HAS INSTALLED SO MANY TYPES OF MACHINES FOR TABLETS, CAPSULES, OINTMENT, SYRUP, INJECTABLE ETC. HAVING IN VARIOUS TYPE, SIZE & MODE L ETC. THE TOTAL ERECTION &. COMMISSIONING EXPENSES ARE RS . 34,70,000 AS PER C.A. CERTIFICATE. 5.9 FREIGHT & PACKING CHARGES OF RS.11,51,000: AT THE SAME WAY, SINCE COMPANY HAVE PURCHASED MANY MACHINES HAVING DIFFERENT SIZE WEIGHT PACKING AND A LSO PURCHASE FROM LOCAL AS WELL AS FROM OUT OF GUJARAT STATE AS WELL AS IMPORT OF MACHINERY. THE COMPANY HAS INCURRED TOTAL FREIGHT & PACKING CHARGES OF RS. 11,51,000 AS PER C.A. CERTIFICATE. 5.10 MOULD, JIG, DIES OF RS. 26,00,000: ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 14 - THE COMPANY IS MANUFACTURING UNIT AND MANUFACTURES VARIOUS SEGMENT PRODUCTS LIKE TABLETS. CAPSULES, OINTMENT, SYRUP AND INJECTABLES. THE COMPANY HAS INSTALLED A NUMBER OF DIFFERENT TYPES OF MACHINERY HAVING DIFFERENT SIZE AND CAPACITY AS PER REQUIREME NT. SECONDLY, COMPANY MANUFACTURES MORE THAN 200 PRODUCTS FOR WHICH COMPANY REQUIRES DIFFERENT TYPES OF DIES, JIG AND MOULD FOR PRODUCTIONS OF VARIETY OF FORMULATIONS. THE MAJOR INVESTMENT REMAINS IN THIS SEGMENT IN PHARMACEUTICAL COMPANY. THE TOTAL AMOUNT OF MOULD, JIG AND DIES IS RS. 26,00,000 AS PER C.A. CERTIFICATE. 5.11 THE COMPANY HAS RIGHTLY CLAIMS SSI STATUS WHIC H IS DULY CONFIRMED BY DISTRICT INDUSTRIES CENTRE BY ISSUING SSI REGISTRATION CERTIFICATION BY INCOME TAX DEPARTMENT BY ALLOWING CLAIM IN ALL ASSESSMENT YEAR, BY CHARTERED ACOUNTANT AS WELL AS BY DEPARTMENT OF SCIENTIFIC RESEARCH AND DEVELOPMENT ORGANIZATION (R&D) GOVT. O F INDIA ETC. 6. THE CONTENTION TO DISALLOW THE CLAIM UNDER SEC. 80IB BY AO NOT JUSTIFIED: 6.1 THE AO MISINTERPRETED THE NOTIFICATION. IN FACT , THE INVESTMENT LIMITS RS. 3.00 CRORE AS PER NOTIFICATIO N NO. S0857(E) DATED 10 TH DECEMBER, 1997 AND NOT RS.1.00 CRORE. 6.2 ACCORDING TO THE AO, THE TOTAL PLANT IS FOR RS. 4.97 CRORE AS ON 01-04-2004. THIS IS NOT CORRECT. THE ASSESS ING OFFICER SHOULD HAVE EXCLUDED THE MACHINERY AS PER N OTE NO. 2 OF NOTIFICATION NO7-SO857(E) DATED 10 TH DECEMBER, 1997. 6.3 THE YEAR-WISE CALCULATION IS ALREADY FURNISHED AT THE TIME OF ASSESSMENT PROCEEDINGS WHICH IS REPRODUCED IN PAGE NO. 14 OF ASST. ORDER. THE SAME IS REPRODUCED IN PARA NO.4 HEREINABOVE. 6.4 IT IS ALREADY STATED THAT ITEM EXCLUDED ARE INC LUDED IN THE PLANT & MACHINERY ACCOUNT WHICH IS GIVEN IN THE ASSESSMENT PROCEEDINGS AT THE TIME OF ASSESSMENT WHICH IS REPRODUCED ON PAGE NO.15 TO 18 OF ORDER. T HE SAME IS REPRODUCED IN PARA NO.5 TO 5.11 HEREINABOVE . 6.5 THE CALCULATION GIVEN IN PARA NO.4 REFERS TO ON LY GROSS VALUE AND NOT WDV. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 15 - 6.6 THE ASSESSEE COMPANY FULFILLS THE CONDITIONS EACH Y EAR AS PER THE CALCULATION IN PARA-4 THE INVESTMENT LIM IT IS BELOW THE LIMIT PRESCRIBED BY THE NOTIFICATIONS. 6.7 IT IS STATED BY THE AO THAT THE LIMIT OF RS.3.0 0 CRORE IS REDUCED TO RS.1.00 CRORE. THIS IS NOT CORRECT. THE AO FAILED TO APPRECIATE THE CLARIFICATION NO. 4(I)-2QO O-SSI DATED 14/03/2000. IT IS CLARIFIED THAT THE UNIT WHI CH HAS ALREADY ACTED UPON, THE NOTIFICATION NO. SO857(E) D ATED 10 TH DECEMBER, 1997 WILL CONTINUE TO ENJOY THE LIMIT OF RS.3.00 CRORE. 6.8 IT IS ALREADY STATED TO THE AO WHICH IS REPRODU CED ON PAGE NO.15 OF ASST. ORDER TO THE EFFECT THAT THE RE CORDS HAVE BEEN DESTROYED DUE TO RAIN IN JULY 2000 AND TH AT THE INTIMATION TO THAT EFFECT WAS ALSO GIVEN TO CCI T BY LETTER DATED 21-07-2000 AND THEREFORE THE INVOICES HAVE BEEN DESTROYED. HOWEVER, THE COPY OF ACCOUNTS AND OTHER SUPPORTING EVIDENCES WHATEVER AVAILABLE H AVE BEEN FURNISHED. THE FACT THAT THE CLAIM OF DEPRECIA TION IS ACCEPTED SUPPORTS THE CLAIM OF THE ASSESSEE. 6.9 THE ASSESSEE FURNISHED THE CA CERTIFICATE DATED 28-01- 2003. IT IS OBVIOUS THAT CA ISSUED THE CERTIFICATE AFTER VERIFICATION OF RELEVANT RECORDS. 6.10 THE ASSESSEE HAS ALREADY FURNISHED THE COPY OF NOTIFICATION DATED 14-01-2005. THE SAID NOTIFICATIO N IS APPLICABLE TO THE DRUGS AND PHARMACEUTICALS. THE ASSESSEE MANUFACTURES THE DRUGS AND PHARMACEUTICALS . THE A 0 SHOULD HAVE POINTED OUT HOW THE SAID NOTIFICATION IS NOT APPLICABLE. 6.11 THE ASSESSEE HAS DEMONSTRATED THAT HE IS ELIGI BLE FOR DEDUCTION UNDER SEC.8OIB BY SUBMISSIONS WITH SUPPORTING EVIDENCES AND NOTIFICATIONS REPRODUCED I N THE ASSESSMENT ORDER. THEREFORE, IT IS NOT CORRECT TO S TATE THAT THE ASSESSEE HAS NOT DEMONSTRATED THE ELIGIBIL ITY OF CLAIM UNDER SEC. 80IB. 6 .12 THE INVESTMENT LIMIT IS RS 3.00 CRORE AND NOT RS 1.00 CRORE AS PER NOTIFICATION NO. SO857(E) DATED 10 TH DECEMBER, 1997 AND RAISED TO RS 5.00 CRORE BY NOTIFICATION NO. SO655(E) DATED 5 TH JUNE 2003. 6.13 THE ASSESSEE HAS ALREADY GIVEN SUFFICIENT EVID ENCES WHICH AO HAS ALSO ACCEPTED BY SAYING THAT THE ASSES SEE MANUFACTURES THE FORMULATIONS WHICH IS NOTHING BUT DRUGS. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 16 - 7. THE ASSESSEE HAS ALREADY FURNISHED THE NOTIFICAT IONS, THE CALCULATION FOR INVESTMENT LIMIT AND OTHER RELE VANT EVIDENCES AND THEREFORE IS ELIGIBLE FOR DEDUCTION U NDER SECTION 80IB. THE CLAIM UNDER SEC. 80IB IS WRONGLY DISALLOWED. 8. YOUR HONOUR IS THEREFORE PRAYED TO ALLOW T HE CLAIM.' 7. THEREAFTER, THE COMMISSIONER OF INCOME TAX (APP EALS) HELD AS UNDER: 6. I HAVE CONSIDERED THE FACTS OF THE CASE, ASSESS ING OFFICER'S FINDINGS, OBSERVATION IN THE ASSESSMENT O RDER AND DETAILED SUBMISSION /ARGUMENTS OF THE LEARNED AUTHO RIZED REPRESENTATIVE WITH CASE LAWS. 7. IT IS SEEN IN THE PRESENT CASE THAT THE ASSESSME NTS FOR THREE YEARS ARE REOPENED ON THE GROUND THAT THE ASS ESSEE IS NOT AN SSIU. IT IS SUBMITTED BY THE AR THAT THIS IS SUE WAS EXAMINED WHILE GRANTING DEDUCTION UNDER SEC. 80IB A ND PASSING THE ORDER UNDER SECTION 143(3) WHICH SUGGES TS THAT IT IS NOTHING BUT A CHANGE OF OPINION. HOWEVER, I FIN D THAT THOUGH THE DEDUCTION UNDER SEC. 80IB WAS GRANTED IN THE ORDER PASSED UNDER SEC. 143(3) THE ISSUE AS TO WHET HER THE ASSESSEE WAS AN SSI UNIT WAS NOT CONSIDERED AND THE REFORE IT IS NOT A CHANGE OF OPINION. BESIDES, WITH THE NEWLY BROUGHT AMENDMENTS IN SECTION 147 RETROSPECTIVELY, THE ASSE SSING OFFICER HAS BEEN GIVEN WIDE GROUND REGARDING REOPEN ING OF ASSESSMENT IS THEREFORE HEREBY REJECTED. 8. COMING TO THE MERITS OF THE CASE, I FIND THAT TH E MINISTRY OF INDUSTRY (DEPARTMENT OF INDUSTRIAL POLICY AND PR OMOTION) ISSUED ORDERS / NOTIFICATION FROM TIME TO TIME. AS PER NOTIFICATION NO. S.O. 857(E) DATED 10 TH DECEMBER 1997 THE LIMIT OF INVESTMENT IN PLANT & MACHINERY FOR TREATI NG THE UNDERTAKING AS SSIU IS RS. 3.00 CRORE. THE NOTE NO . 2(B) OF THE SAID NOTIFICATION ALSO PROVIDES THE MODE OF CAL CULATING THE VALUE OF PLANT & MACHINERY. THE SAID NOTE PROVIDES EXCLUSION FROM THE PLANT & MACHINERY WHILE CALCULATING THE LI MIT FOR INVESTMENT. IN OTHER WORDS, CERTAIN MACHINERY SUCH AS JIGS, DIES, MOULDS, GENERATOR, ELECTRIC FITTING, PRE-OPER ATIVE EXPENSES ETC. ARE TO BE EXCLUDED. 9. THE LIMIT OF RS. 3.00 CRORE WAS REDUCED TO RS. 1 .00 CRORE BY NOTIFICATION NO. S.O. 1288(E) DATED 24 TH DECEMBER 1999. HOWEVER, THE CLARIFICATION IS ISSUED BY NOTIF ICATION NO. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 17 - 4(I)/2000-SSI B DATED 14 TH MARCH 2000 TO THE EFFECT THAT 'THE UNITS WHICH HAD SWITCHED TO THE SSI STATUS BASED ON THE ORDER DATED 10 TH DECEMBER 1997 WOULD CONTINUE TO REMAIN AS SSI UNITS INSPITE OF THE ORDER DATED 24 TH DECEMBER 1999.' 10. IT IS SEEN THAT THE ASSESSEE HAS ALREADY SWITCH ED OVER TO THE SSI STATUS BASED ON ORDER DATED 10 TH DECEMBER 1997 AND THEREFORE THE LIMIT OF RS. 1.00 CRORE AS PER OR DER NO. S.O. 1288(E) DATED 24 TH DECEMBER 1999 IS NOT APPLICABLE TO THE APPELLANT HAS BROUGHT TO MY NOTICE THE CERTIFICATE DATED 25 TH JULY 2002 ISSUED BY FUNCTIONAL MANAGER, DISTRICT IN DUSTRIES CENTRE, GANDHINAGAR IN WHICH THE VALUE OF PLANT & M ACHINERY IS RS. 2,55,81,000. 11. THE ANOTHER NOTIFICATION NO. S.O. 655(E) DATED 5 TH JUNE 2003 WAS ISSUED IN WHICH IT IS STATED THAT THE CATE GORY OF ITEMS OF DRUGS AND PHARMACEUTICAL SECTOR IS COVERED BY 5SIU. ANOTHER NOTIFICATION NO. I(4)/2004-SSI BOARD & POLI CY DATED 14 TH JANUARY 2005 WAS ISSUED WHEREBY THE LIMIT OF INVES TMENT IN PLANT & MACHINERY IS UNDERTAKING, MANUFACTURING DRUGS AND PHARMACEUTICALS. 12. IT IS SEEN FROM THE NOTIFICATIONS STATED HEREIN ABOVE THAT THE LIMIT FOR SSIU MANUFACTURING DRUGS AND PHARMACE UTICAL IS RS. 3.00 CRORE FROM 10 TH DECEMBER 1997 AS PER NOTIFICATION NO. 857(E) AND THAT THE LIMIT IS RS. 5.00 CRORE AS PER NOTIFICATION NO. 655(E) WITH EFFECT FROM 5 TH JUNE 2003. IT MEANS THAT THE LIMIT OF PLANT & MACHINERY FOR A.Y. 2003-2004 IS RS. 3.00 CRORE AND FOR A.Y. 2004-2005 & 2005-200 6 IS RS. 5.00 CRORE. THE APPELLANT HAS FURNISHED THE CALCUL ATION OF PLANT & MACHINERY AS ON 31 ST MARCH EACH YEAR. THE SAME IS REPRODUCED BELOW: LINCOLN PHARMACEUTICALS LTD. SSI ASSETS AS ON DATE 31-03- 2003 31-03- 2004 31-03- 2005 GROSS PLANT & MCHINAHY 480.33 497.88 516.93 EXEMPTED PLANT & MACHINARY REVALUATION OF MACHINERY 46.19 46.19 46.19 PRE OPERATIVE EXP. 11.46 11.46 11.46 R&D ASSETS 65.68 66.71 67.50 ERECTION & COMMISSONING 34.70 34.70 34.70 FREIGHT & PACKING 11.5 11.51 11.51 MOULD DIES & JIGS 26 26 26 D.G.SET 9.32 9.32 9.32 ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 18 - E.T.P.PLANT 3.17 3.17 3.17 EXEMPTED ASSETS 208.03 205.06 209.85 NET PLANT & MACHINERY 272.30 288.82 307.08 SSI LIMIT 300 500 500 12.1 FROM THE TABLE, IT IS SEEN THAT THE REVALUATIO N RESERVE IS REDUCED SINCE IT IS NOT A PART OF THE COST. THE OTH ER MACHINERY AND EXPENSES ARE EXCLUDED AS PER NOTE NO. 2(B) AS P ER NOTIFICATION NO. 857(E). EACH ITEM OF EXCLUSION IS SUPPORTED BY THE EVIDENCE INCLUDING C.A. CERTIFICATE DATED 28-01 -2003 GIVEN IN THE PAPER BOOK. I HAVE CONSIDERED THE WRITTEN SU BMISSION GIVEN IN PARA NO 5 IN RESPECT OF EACH EXCLUSION FRO M THE VALUE OF PLANT & MACHINERY. THEREFORE, IN MY OPINION THE EXCLUSIONS MADE IS IN ORDER. 12.2 ACCORDINGLY, IT IS SEEN THAT THE APPELLANT IS WELL WITHIN THE LIMITS FIXED BY THE GOVERNMENT AND THEREFORE TH E APPELLANT REMAINED AS AN SSIU FOR ALL THE 3 YEARS. I HAVE ALS O CONSIDERED THE REASONS GIVEN BY THE AO IN PARA NO. 8 OF THE ASST. ORDER AND REPLY TO IT GIVEN IN THE WRITTEN SU BMISSION IN PARA NO. 6 GIVING EXPLANATION FOR EACH ITEM. IT THU S, CLARIFIES THAT THE APPELLANT IS ENTITLED TO DEDUCTION UNDER S EC. 80IB AS SSIU. 13. FURTHER, THE AR ALSO SUBMITTED THAT THE APPELLA NT IS REGISTERED AS SSIU AS PER CERTIFICATE DATED 25 TH JULY 2002 ISSUED BY FUNCTIONAL MANAGER, DISTRICT INDUSTRIES C ENTRE, GANDHINAGAR IN WHICH THE VALUE OF MACHINERY MENTION ED IS RS. 2,55,81,000. THE AR SUBMITTED THAT WHEN ANOTHER CEN TRAL GOVERNMENT AUTHORITY CERTIFIES THAT THE APPELLANT'S UNDERTAKING IS A SSIU THEN IT IS NOT PROPER FOR THE AO TO MAKE FURTHER INQUIRY ABOUT THE LIMIT OF PLANT & MACHINERY AND TO HOLD THAT THE ASSESSEE IS NOT A SSIU. FOR THIS PROPOSITION TH E ASSESSEE HAS PLACED RELIANCE ON THE FOLLOWING CASES. APOLLO TYRES LTD. V/S. CIT 255 ITR 273 (SC) VADILAL CHEMICALS LTD. V/S. STATE OF ANDHRA PRADESH AND OTHERS 142 STC 76 (SC) MALAYALA AAAMORAMA CO. LTD. V/S. CIT 300 ITR 251 (SC ) 13.1 THE SC IN THE CASE OF VADILAL CHEMICALS LTD. V /S. STATE OF ARIDHRA PRADESH AND OTHERS 142 STC 76 (SC) FOLLO WED THE SC DECISION IN THE CASE OF APOLLO TYRES LTD. V/S. C IT 255 ITR 273 AND OBSERVED ON PARA NO. 22 ON PAGE NO. 86-87 O F AIR AS UNDER: '22. FURTHERMORE, UNDER THE INCENTIVE SCHEME IN QUESTION, THERE WAS ONLY ONE METHOD OF VERIFYING TH E ELIGIBILITY FOR THE VARIOUS INCENTIVES GRANTED INCL UDING ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 19 - SALES TAX EXEMPTION. THE PROCEDURE WAS FOR THE MATT ER TO BE SCRUTINIZED AND DISTRICT LEVEL COMMITTEE AND THE CERTIFICATION BY THE DEPARTMENT OF INDUSTRIES AND COMMERCE BY ISSUING AN ELIGIBILITY CERTIFICATE. THE RE WAS NO OTHER METHOD PRESCRIBED UNDER THE SCHEME FOR DETERMINING AN INDUSTRIAL UNIT'S ELIGIBILITY FOR TH E BENEFITS GRANTED. THE DEPARTMENT OF INDUSTRIES AND COMMERCE HAVING EXERCISED ITS MIND, AND HAVING GRANTED THE F INAL ELIGIBILITY CERTIFICATE (WHICH WAS VALID AT ALL MAT ERIAL TIMES), THE COMMERCIAL TAXES DEPARTMENT COULD NOT G O BEYOND THE SAME. MORE SO WHEN THE COMMISSIONER, SALES TAX HAD ACCEPTED THE ELIGIBILITY CERTIFICATE ISSUED TO THE APPELLANT AND HAD SEPARATELY NOTIFIED THE APPELLANT'S ELIGIBILITY FOR EXEMPTION UNDER THE 193 3 6.O. IN THESE CIRCUMSTANCES THE DCCT CERTAINLY COULD NOT ASSUME THAT THE EXEMPTION WAS WRONGLY GRANTED NOR D ID HE HAVE THE JURISDICTION UNDER SECTION 20 OF THE ST ATE ACT TO GO BEHIND THE ELIGIBILITY CERTIFICATE AND EM BARK UPON A FRESH ENQUIRY WITH REGARD TO THE APPELLANT'S ELIGIBILITY FOR THE GRANT OF 14. IN THE LIGHT OF RA TIO LAID DOWN IN THE ABOVE QUOTED JUDICIAL PRONOUNCEMENTS, T HE FACTS OF THE PRESENT CASE HAVE BEEN EXAMINED. THE S C HAS HELD IN THE ABOVE REFERRED CASES THAT WHEN ANOT HER CENTRAL GOVERNMENT AUTHORITY ISSUES THE CERTIFICATE TO THE EFFECT THAT THE ASSESSEE IS AN SSIU IT IS NOT P ROPER FOR THE AO TO MAKE FURTHER INQUIRY IN THE MATTER. O N THIS BASIS ALSO THE APPELLANT IS AN SSI UNIT. THEREFORE, I HOLD THAT THE ASSESSEE IS AN SSI UNIT FOR A.Y. 2003-2004 TO A.Y. 2005-2006 AND IS ENTITLED TO DEDUCTION UNDER SECTION 80IB. THE AO IS ACCORDINGLY DIRECTED TO ALL OW THE SAID DEDUCTION TO THE APPELLANT FOR ALL THE THREE ASSESSMENT YEARS. 16. IN THE RESULT ALL THE THREE APPEALS ARE PA RTLY ALLOWED. 8. BEFORE US, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE REITERATED HIS SUBMISSIONS MADE BEFORE THE COMMISSI ONER OF INCOME TAX (APPEALS). 9. ON THE OTHER HAND, THE DEPARTMENTAL REPRESENTAT IVE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 20 - 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSE D THE ORDERS OF LOWER AUTHORITIES AND MATERIAL AVAILABLE ON RECORD. IN THE INSTANT CASE, THE ASSESSEE CLAIMED DEDUCTION U/S. 8 0IB(10) OF THE ACT AMOUNTING 38,07,493/- IN ASSESSMENT YEAR 2003-04, R S 37,13,631/- IN ASSESSMENT YEAR 2004-05 AND RS 44,22,737/- IN AS SESSMENT YEAR 2005-06 WHICH WAS ALLOWED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDERS PASSED U/S. 143(3) OF THE ACT. TH EREAFTER, THE ASSESSING OFFICER REOPENED THE ASSESSMENT FOR ALL T HE THREE YEARS UNDER CONSIDERATION BY ISSUING NOTICE U/S. 148 OF T HE ACT ON THE GROUND THAT AS PER SECTION 11 OF THE INDUSTRIAL (DE VELOPMENT & REGULATION) ACT, 1951 AS AMENDED VIDE SO 857(E) DAT ED 10.12.1999, SMALL SCALE UNDERTAKING IS AN INDUSTRIAL UNDERTAKIN G IN WHICH INVESTMENT IN FIXED ASSETS IN PLANT AND MACHINERY D OES NOT EXCEED RS 1 CRORE. AS PER SCHEDULE 5 OF THE BALANCE SHEET , THE AUDITORS HAVE CERTIFIED THAT FOR ASSESSMENT YEARS 2003-04, 2 004-05 AND 2005-06, THE TOTAL VALUE OF PLANT AND MACHINERY WAS RS 4,73,81,571/-, RS 4,80,33,282/- AND RS 4,97,88,775/ - RESPECTIVELY WHICH EXCEEDS THE LIMIT FIXED FOR PLANT AND MACHINE RY AND THE ASSESSEE CEASED TO BE A SSI UNIT AND WAS NOT ELIGIB LE FOR DEDUCTION U/S. 80IB OF THE ACT. THE ASSESSEE HAS CLAIMED AND WAS ALLOWED DEDUCTION U/S. 80IB FOR THE YEARS UNDER CONSIDERATI ON. THEREFORE, THE INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE INCOME TAX ACT, 1961. 11. A PERUSAL OF THE REASONS RECORDED SHOWS THAT T HE ORIGINAL ASSESSMENT IN THE INSTANT CASE WAS COMPLETED FOR AS SESSMENT YEAR 2003-04 U/S. 143(3) READ WITH SECTION 147 ON 30.01. 2006, FOR ASSESSMENT YEAR 2004-05 U/S. 143(3) ON 18.12.2006 A ND FOR ASSESSMENT YEAR 2005-06 U/S. 143(3) ON 28.03.2007. FROM A PERUSAL OF THE ABOVE RECORDING, WE FIND THAT THE AS SESSING OFFICER ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 21 - FAILED TO BRING ON RECORD ANY NEW TANGIBLE MATERIAL WHICH HAS COME TO HIS NOTICE SUBSEQUENT TO THE COMPLETION OF THE A SSESSMENT MADE FOR ASSESSMENT YEAR 2003-04 U/S. 143(3) READ WITH S ECTION 147 ON 30.01.2006, FOR ASSESSMENT YEAR 2004-05 U/S. 143(3) ON 18.12.2006 AND FOR ASSESSMENT YEAR 2005-06 U/S. 143 (3) ON 28.03.2007. THE RECORDING OF REASONS SHOWS THAT THE ALLEGED REASONS TO BELIEVE WERE FORMED ON THE BASIS OF BAL ANCE SHEET FILED ALONGWITH THE RETURN OF INCOME BY THE ASSESSEE WHIC H WAS AVAILABLE WITH THE ASSESSING OFFICER AT THE TIME OF FRAMING O F THE ORIGINAL ASSESSMENT. IT CANNOT BE HELD THAT THIS MATERIAL W AS NOT AVAILABLE. 12. THE HONBLE SUPREME COURT IN THE CASE OF PARAS HURAM POTTERY WORKS CO. LTD. VS. ITO (1977) 106 ITR 1 (SC ) HELD AS UNDER: IT HAS BEEN SAID THAT THE TAXES ARE THE PRICE THAT WE PAY FOR CIVILIZATION. IF SO, IT IS ESSENTIAL THAT THOSE WH O ARE ENTRUSTED WITH THE TASK OF CALCULATING AND REALIZING THAT PRI CE SHOULD FAMILIARIZE THEMSELVES WITH THE RELEVANT PROVISIONS AND BECOME WELL-VERSED WITH THE LAW ON THE SUBJECT. ANY REMISSNESS ON THEIR PART CAN ONLY BE AT THE COST OF THE NATIONAL EXCHEQUER AND MUST NECESSARILY RESULT IN LOSS OF RE VENUE. AT THE SAME TIME, WE HAVE TO BEAR IN MIND THAT THE POL ICY OF LAW IS THAT THERE MUST BE A POINT OF FINALITY IN ALL LE GAL PROCEEDINGS, THAT STALE ISSUES SHOULD NOT BE REACTIVATED BEYOND A PARTICULAR STAGE AND THAT LAPSE OF TIME MUST INDUCE REPOSE IN AND SET AT REST JUDICIAL AND QUASI-JUDICIAL CONTROVERSIES AS I T MUST IN OTHER SPHERES OF HUMAN ACTIVITY. SO FAR AS THE INCOME-TAX ASSESSMENT ORDERS ARE CONCERNED, THEY CANNOT BE REO PENED ON THE SCORE OF INCOME ESCAPING ASSESSMENT UNDER SECTI ON 147 OF THE ACT OF 1961 AFTER THE EXPIRY OF FOUR YEARS FROM THE END OF THE ASSESSMENT YEAR UNLESS THERE BE OMISSION OR FAI LURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY AL L MATERIAL FACTS NECESSARY FOR THE ASSESSMENT. 13. THE HONBLE DELHI HIGH COURT, AFTER TAKING INT O CONSIDERATION THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. KELVINATOR OF INDIA LIMITED (2010) 320 ITR 561 (SC), DECISIONS OF THE HONBLE DELHI HIGH COURT IN THE CA SE OF CIT VS. USHA ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 22 - INTERNATIONAL LTD. (2012) 348 ITR 485 (FB)(DEL.) AN D IN THE CASE OF CIT VS. ORIENT CRAFT LTD. (2013) 354 ITR 536 (DEL.) , HAS HELD IN ITS RECENT DECISION DATED 14.08.2014 IN THE CASE OF MAD HUR KHOSLA VS. ACIT IN WRIT PETITION(C) 1320/2014, C.M. NO.2744/20 14 & 2745/2014 AS UNDER: 11. THE FOUNDATION OF THE AOS JURISDICTION AND THE RAISON DETRE OF A REASSESSMENT NOTICE ARE THE REASONS TO BELIEVE. NOW THIS SHOULD HAVE A RELATION OR A LINK WIT H AN OBJECTIVE FACT, IN THE FORM OF INFORMATION OR FACTS EXTERNAL TO THE MATERIALS ON THE RECORD. SUCH EXTERNAL F ACTS OR MATERIAL CONSTITUTE THE DRIVER, OR THE KEY WHICH EN ABLES THE AUTHORITY TO LEGITIMATELY RE-OPEN THE COMPLETED ASS ESSMENT. IN ABSENCE OF THIS OBJECTIVE TRIGGER, THE AO DOES NOT POSSESS JURISDICTION TO REOPEN THE ASSESSMENT. IT IS AT THE NEXT STAGE THAT THE QUESTION, WHETHER THE RE-OPENING OF ASSESS MENT AMOUNTS TO REVIEW OR CHANGE OF OPINION ARISES. IN OTHER WORDS, IF THERE ARE NO REASONS TO BELIEVE BASED O N NEW, TANGIBLE MATERIALS, THEN THE REOPENING AMOUNTS TO AN IMPERMISSIBLE REVIEW. HERE, THERE IS NOTHING TO SHO W WHAT TRIGGERED THE ISSUANCE OF NOTICE OF REASSESSMENT NO INFORMATION OR NEW FACTS WHICH LED THE AO TO BELIEV E THAT FULL DISCLOSURE HAD NOT BEEN MADE. THE IMPUGNED NOTICE, THE AOS ORDER REJECTING THE OBJECTIONS, AND THE ARGUMENTS O F THE REVENUE NOWHERE INDICATE HOW THE AO WAS IMPELLED TO SEEK RE-OPENING OF THE ASSESSEES CASE, AS DISTINGUISHED FROM THE SEVERAL OTHER COMPLETED ASSESSMENTS. 12. FOR THESE REASONS, THIS COURT IS OF THE OPINION THAT THE IMPUGNED REASSESSMENT NOTICE CANNOT BE SUSTAINED; I T IS HEREBY QUASHED. THE WRIT PETITION AND THE PENDING A PPLICATION ARE ALLOWED IN THE ABOVE TERMS WITHOUT ORDER AS TO COSTS. 14. IN THE INSTANT CASE, WE FIND THAT IN THE ALLEG ED REASONS AS RECORDED, NO MATERIAL EXTERNAL TO THE RECORD WHICH WAS AVAILABLE HAS BEEN BROUGHT ON RECORD FOR ISSUANCE OF NOTICE U/S. 148 OF THE ACT. IN OTHER WORDS, THERE WAS NO OBJECTIVE TRIGGER AVAIL ABLE WITH THE ASSESSING OFFICER WITHIN THE MEANING OF THE RECENT DECISION OF THE HONBLE DELHI HIGH COURT QUOTED ABOVE. THEREFORE, IN THE ABSENCE OF THE SAME, IN OUR CONSIDERED OPINION, IN VIEW OF THE ABOVE DECISION OF THE HONBLE DELHI HIGH COURT AND THE DECISION OF HO NBLE SUPREME ITA NOS 2687, 2688 & 2688/AHD/2010 AND CO NOS. 153, 154 & 155/AHD/2013 LINCOLN PHARMACEUTICALS, AHMEDABAD FOR A.Y. 2003-04, 2004-05 & 2005-06 - 23 - COURT, THE ISSUANCE OF NOTICE U/S. 148 FOR ASSESSME NT YEAR 2003-04 ON 12.06.2009, FOR ASSESSMENT YEAR 2004-05 ON 17.03 .2009 AND FOR ASSESSMENT YEAR 2005-06 ON 17.03.2009 CANNOT BE UPH ELD. CONSEQUENTLY, IMPUGNED REASSESSMENT ORDERS FOR ASSE SSMENT YEARS 2003-04, 2004-05 AND 2005-06, ALL DATED 29.10.2009 ARE UNSUSTAINABLE. ACCORDINGLY, WE SET ASIDE THE IMPUG NED REASSESSMENT ORDERS. THE CROSS OBJECTIONS OF THE A SSESSEE ON JURISDICTIONAL GROUND STAND ALLOWED. 15. IN VIEW OF OUR ABOVE DECISION ON THE JURISDICT IONAL GROUND TAKEN BY THE ASSESSEE IN CROSS OBJECTIONS, THE APPE ALS OF THE REVENUE FOR ALL THREE YEARS UNDER CONSIDERATION HAV E BECOME ACADEMIC IN NATURE AND REQUIRE NO SEPARATE ADJUDICA TION AND ACCORDINGLY, THE SAME ARE DISMISSED. 16. IN THE RESULT, THE APPEALS OF THE REVENUE FOR ASSESSMENT YEAR 2003-04, 2004-05 AND 2005-06 ARE DISMISSED WHE REAS THE CROSS OBJECTIONS OF THE ASSESSEE FOR ASSESSMENT YEA R 2003-04, 2004-05 AND 2005-06 ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON FRIDAY, THE 5 TH OF SEPTEMBER, 2014 AT AHMEDABAD. SD/- SD/- (KUL BHARAT) JUDICIAL MEMBER ( N.S. SAINI) ACCOUNTANT MEMBER AHMEDABAD; DATED 05/09/2014 GHANSHYAM MAURYA, SR. P.S.