M/s Aar Ess Exim Private Ltd., New Delhi V. ITO, New Delhi

CO 51/DEL/2011

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8512 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 1 month(s) 18 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-04-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 14-03-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 01-03-2011
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: BHIM SINGH; A MISRA
• Assessee Lawyers: ASHWANI TANEJA; TARUN KUMAR S
• Keywords: Additional evidence; Question of law
• Section: 143(3); 14A; 133(6); 10B; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH A : NEW DELHI) BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER AND SHRI C.M. GARG, JUDICIAL MEMBER ITA NO.880/DEL./2011 (ASSESSMENT YEAR : 2007-08) ITA NO.1833/DEL./2012 (ASSESSMENT YEAR : 2008-09) ITO, WARD 1 (1), VS. M/S. AAR ESS EXIM PRIVATE LT D., NEW DELHI. B 1/245, PASCHIM VIHAR, NEW DELHI 110 062. (PAN : AAACA0807G) CO NO.51/DEL/2011 (IN ITA NO.880/DEL./2011) (ASSESSMENT YEAR : 2007-08) CO NO.193/DEL/2012 (IN ITA NO.1833/DEL./2012) (ASSESSMENT YEAR : 2008-09) M/S. AAR ESS EXIM PRIVATE LTD., VS. ITO, WARD 1 ( 1), B 1/245, PASCHIM VIHAR, NEW DELHI. NEW DELHI 110 062. (PAN : AAACA0807G) (APPELLANT) (RESPONDENT) ASSESSEE BY : S/SHRI ASHWANI TANEJA & TARUN KUMAR, ADVOCATES REVENUE BY : SMT. A. MISRA, CIT DR AND SHRI BHIM S INGH, SR.DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 2 THE REVENUE HAS FILED THE APPEALS, ITA NO.880/DEL/ 2011 FOR THE ASSESSMENT YEAR 2007-08 AND ITA NO.1833/DEL/2012 AS SESSMENT YEAR 2008-09, WHEREAS THE ASSESSEE HAS FILED THE CROSS O BJECTIONS BEING CO NOS.51/DEL/2011 AND 193/DEL/2012 RESPECTIVELY IN TH ESE ASSESSMENT YEARS. 2. THE ASSESSEE IS A PRIVATE LIMITED COMPANY. THE ASSESSEE IS DOING BUSINESS OF EXPORT FROM A NSEZ (NODIA EXPORT PROCES SING ZONE) UNIT, NOIDA. 3. THE GROUNDS OF REVENUES APPEAL IN ITA NO.880/DE L/2011 READ AS UNDER :- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN LAW IN DELETING ADDITION OF RS.69,69,429/- MADE ON ACCOUNT OF DISAL LOWANCE OF EXEMPTION CLAIMED UNDER SECTION 10B OF THE INCOME T AX ACT, 1961 AS A SPEAKING ORDER HAS NOT BEEN PASSED BY LD. CIT(A) ON THE FACTS THAT HAVE BEEN BROUGHT OUT BY THE ASSESSING OFFICER TO S UPPORT THE CONTENTION THAT NO MANUFACTURING ACTIVITY WAS CARRI ED OUT BY THE ASSESSEE. 2. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RI GHT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEA L AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. THE GROUNDS IN ASSESSEES CROSS OBJECTION NO.51/DEL /2011 READ AS UNDER :- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN REJECT ING THE ADMISSION OF ADDITIONAL EVIDENCES FILED BY THE ASSESSEE UNDER RULE 46A OF INCOME TAX RULES. 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN NOT DE LETING THE ADDITION OF RS.46,643/- MADE BY LD. AO ON ACCOUNT OF SHORT T ERM CAPITAL GAIN. ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 3 3. THAT THE CROSS OBJECTOR CRAVES THE LEAVE TO ADD, AMEND, MODIFY, DELETE ANY OF THE GROUND(S) OF CROSS OBJECTION BEFO RE OR AT THE TIME OF HEARING. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF APPE AL IN ITA NO.1833/DEL/2012 :- 1. THE LD. CIT(A) HAS ERRED ON FACTS AND IN ALLOWI NG THE CLAIM OF ASSESSEE FOR EXEMPTION U/S 10B OF THE INCOME TAX AC T, 1961. 2. THE LD. CIT(A) HAS ERRED ON FACTS AND IN DIRECTI NG THE AO TO VERIFY THE SUBMISSION OF THE ASSESSEE AND ALLOW THE EXEMPTION U/S 10B OF THE INCOME TAX ACT, 1961 AT RS.12,17,41,816/ - AS CLAIMED BY THE ASSESSEE , IF ITS CLAIM DOES NOT INCLUDE OTHER INCOME AND JOB WORK/LOCAL SALES IS FOUND TO BE CORRECT. 3. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIG HT TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEA L AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. THE ASSESSEE HAS TAKEN THE FOLLOWING GROUNDS IN CRO SS OBJECTION NO.193/DEL/2012 :- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRM ING THE ACTION OF LD. AO IN MAKING DISALLOWANCE OF EXPENDITURE ON PRO PORTIONATE BASIS FOR RS.3,14,240/- U/S 14A READ WITH RULE 8D OF THE INCOME TAX RULES. 2. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER, ACTION OF LD. CIT(A) IN CONFIRMING OF ACTION OF LD. AO IN MAKING DISALLOWANCE OF RS.3,14,240/- IS BAD IN LAW AND AGAINST THE FACTS A ND CIRCUMSTANCES OF THE CASE. 3. THAT THE CROSS OBJECTOR CRAVES THE LEAVE TO ADD, AMEND, MODIFY, DELETE ANY OF THE GROUND(S) OF CROSS OBJECTION BEFO RE OR AT THE TIME OF HEARING. ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 4 4. THUS, IN BOTH THE REVENUES APPEAL, THE ISSUE IN VOLVED IS DELETING THE ADDITION MADE ON ACCOUNT OF DISALLOWANCE OF EXEMPTI ON CLAIMED U/S 10B OF THE INCOME-TAX ACT, 1961. WHILE PLEADING ON BEHALF OF THE REVENUE, THE LD. DR SUBMITTED THAT IN THE ASSESSMENT YEAR 2007-08, T HE ASSESSING OFFICER ISSUED THE LETTERS U/S 133(6) OF THE INCOME-TAX ACT , 1961 TO THE SUPPLIERS OF MATERIAL AND AS PER THEIR INFORMATION, THE MANUFACT URING WAS NOT DONE AT NSEZ UNIT FOR WHICH THE DEDUCTION U/S 10B IS CLAIME D. IN VIEW OF THIS REPLY FROM THE SUPPLIERS, THE ASSESSEE DOES NOT DESERVE D EDUCTION U/S 10B OF THE INCOME-TAX ACT, 1961 AND ASSESSEE WRONGLY CLAIMED T HE DEDUCTION. THE LD. DR ALSO SUBMITTED THAT THE ASSESSEES CLAIM THAT TH EY WERE MANUFACTURING AND EXPORTING 100% HIGH TECH ENGINEERING TAILOR MADE IT EMS FROM THE NSEZ UNIT FOR FOREIGN COMPANIES, THEREFORE, THERE IS NO NEED FOR INCURRING ANY INDIRECT COST, IS ALSO NOT JUSTIFIED. THE EXPENDIT URE ON THE ELECTRICITY FOR THE YEAR WAS NOMINAL. SUCH SMALL EXPENDITURE ON THE EL ECTRICITY SHOWS THAT THERE WAS NO MANUFACTURING ACTIVITY CARRIED OUT AT NSEZ. THERE WAS NO BUSINESS PROMOTION EXPENSES DEBITED IN THE PROFIT & LOSS ACC OUNT. SHE VEHEMENTLY PLEADED THAT THE CIT (A) WAS NOT JUSTIFIED IN GRANT ING THE RELIEF TO THE ASSESSEE. SHE FINALLY RELIED ON THE ORDER OF THE A SSESSING OFFICER. ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 5 5. WHILE PLEADING ON BEHALF OF THE ASSESSEE, THE LE ARNED AR SUBMITTED THAT ASSESSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURIN G OF ENGINEERING ITEMS, MACHINES ANDS EQUIPMENTS FOR VARIOUS KINDS OF PROJE CTS. THE ASSESSEE COMPANY IS 100% EOU SITUATED AT NOIDA EXPORT PROCES SING ZONE, NOIDA (U.P.). IT IS A CUSTOM BOUNDED AREA. A LEGAL AGRE EMENT HAS BEEN ENTERED INTO BETWEEN THE MANUFACTURING UNITS SITUATED IN SEZ AND THE PRESIDENT OF INDIA THROUGH DEVELOPMENT COMMISSIONER (NEPZ), SEZ NOIDA. THE ASSESSEE WAS CARRYING OUT ACTIVITIES SINCE MANY YEARS AND DEDUCT ION U/S 10B WAS ALLOWED IN EARLIER YEARS. THE CLAIM OF EXEMPTION WAS MADE U/S 10B IN THE RETURN OF INCOME. IT WAS SUPPORTED BY AUDITED REPORT. THE A SSESSEE IS ENGAGED IN THE MANUFACTURING OF SPECIAL PURPOSE PLANT. THIS ASPEC T IS SUPPORTED BY THE COPIES OF THE INVOICES OF RAW MATERIAL, FREIGHT AND CARRIAGE CHARGES PAID FOR RECEIVING THE RAW MATERIAL AND EXPLAINING THE ENTIR E MANUFACTURING PROCESS, INVOICE, PACKING LIST, FIRC, DETAILS OF WAGES PAID, DESIGN AND DRAWING BASED ON WHICH THE PROJECT WAS EXECUTE BY THE ASSESSEE. THE ASSESSEE FILED AGREEMENTS WITH THE OTHER PARTIES FOR WHOM THE DESI GNING AND COMMISSIONING WAS DONE. ALL THESE ASPECTS MAKE THE ASSESSEE ELIG IBLE FOR DEDUCTION U/S 10B OF THE ACT. THE ASSESSING OFFICERS OBJECTIONS THA T ASSESSEE HAS ERECTED CEMENT/STEEL ROLLING MILL ABROAD AND SUCH TASKS WER E NOT POSSIBLE TO BE CARRIED OUT THERE AT THE SITE OF THE ASSESSEE AT NOIDA UNIT IS NOT TRUE. NO DOUBT ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 6 ASSESSEE MANUFACTURES CEMENT AND STEEL ROLLING MILL S AND THESE ARE SUPPLIED IN VARIOUS SUB-ASSEMBLIES AND COMPONENTS MANUFACTURED BY THE ASSESSEE OR AFTER GETTING THEM MANUFACTURED AS PER THE PRESCRIBED SPE CIFICATIONS. THESE ASSEMBLIES AND COMPONENTS ARE TRANSPORTED TO NSEZ, NOIDA UNIT AND AFTER PERFORMING CERTAIN OPERATIONS, THESE ITEMS ARE EXPO RTED. LD. AR SUBMITTED THAT MANUFACTURING OF INTERMEDIARY PRODUCTS WHICH A RE ULTIMATELY USED IN FINAL PRODUCT IS ALSO A MANUFACTURING ACTIVITY. FU RTHER, LD. AR SUBMITTED THAT MOTOR SPEED CONTROLLER, PNEUMATIC MATERIAL CONVEYOR S, KLIN FEEDING MECHANISMS, VERTICAL SHAFT KLIN AND SO MANY OTHER T HINGS ARE MANUFACTURED WITH THE HELP OF RAW MATERIAL PURCHASED AND SUCH MA NUFACTURING TAKES PLACE WITH THE HELP OF SKILL WORKERS HIRED FROM TIME TO T IME. THE ASSESSEE PRODUCED THE WAGE REGISTER BEFORE THE ASSESSING OFFICER. TH E ASSESSING OFFICERS OBJECTION THAT ASSESSEE DISASSEMBLES THE FINISHED G OODS IS NOT MANUFACTURING IS NOT CORRECT. THE ASSESSEE IS FOLLOWING A PROCES S OF ASSEMBLING AND THEN DISASSEMBLING AS MANUFACTURING ACTIVITY. THE ASSE SSING OFFICERS NOTICE THAT ULTIMATELY FINISHED PRODUCT MUST BE MANUFACTURED AT THE UNIT ITSELF IS NOT CORRECT. THE ASSESSEE MANUFACTURES VARIOUS COMPONE NTS AND SUB ASSEMBLIES FOR ULTIMATE FINISHED PROJECT OF CEMENT MILL AN D STEEL ROLLING PLANTS. SUCH ACTIVITIES ALSO COVERED MANUFACTURING OF GOODS AS CONTEMPLATED IN SECTION 10B. LD. AR SUBMITTED THAT THESE ASSEMBLIN G IS DONE DUE TO THE ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 7 REASON THAT THE ASSEMBLE MACHINES CANNOT BE CONTAIN ERIZED ON ACCOUNT OF ODD SIZES, THEREFORE, THESE MACHINES ARE PARTIALLY DISA SSEMBLED FOR PROPER PACKAGING FOR EXPORTING THE SAME. SUCH DISASSEMBLY ACTION IS NECESSARY FOR TRANSPORTATION AND INSTALLATION. THE ASSESSING OFF ICERS CONTENTION THAT TRIAL RUNS ARE CONDUCTED AT CUSTOMER SITE IS NOT HAVING A NY RELEVANCE FOR GRANTING THE EXEMPTION U/S 10B FOR MANUFACTURING THE ITEMS A T THE ELIGIBLE UNIT. THE LEARNED AR SUBMITTED THAT THE ASSESSEE MANUFACTURES THE SPECIAL PURPOSE HIGH PRECISION MACHINES AND DESIGNED AS PER THE SPECIFIC REQUIREMENTS OF THE CUSTOMERS AND MANUFACTURING SUCCEEDS THE ENGINEERIN G EVALUATION OF THE TECHNICAL NEEDS OF THE CUSTOMERS. LD. AR SUBMITTED THAT THE ASSESSEE REQUIRES LATHE, WELDING, CUTTING, CRANES, ELECTRICAL HOISTS, CHAIN PULLEY AND VARIOUS TOOLS WHICH ARE USED IN MANUFACTURING OF THESE MACHINES. THE ASSESSING OFFICERS OBSERVATION THAT ASSESSEE HAS NOT MORE MACHINES IS BASELESS. THE REQUIREMENT OF THE MACHINE IS MINIMUM DUE TO THE FACT THAT MOST OF THE WORK IS DONE MANUALLY BY LABOURERS WHOSE WAGES HAD BEEN PAID TO THE TUNE OF RS.23 LAKHS IN THE PROFIT AND LOSS ACCOUNT. THE CONSULTANCY CH ARGES WERE DEBITED OF RS.28 LAKHS TOWARDS ENGINEERS AND CONSULTING COMPANIES. THEREFORE, LOWER EXPENDITURE DEBITED FOR ELECTRICITY WILL NOT GIVE T HE SCOPE FOR TAKING ADVERSE INFERENCES AGAINST THE ASSESSEE. THE ASSES SEE ALSO PUT HIS EVIDENCES IN THE FORM OF WEBSITE WHICH GIVES THE DETA ILS OF CORE TEAM OF THE ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 8 ASSESSEE. ALL THESE FACTS SHOW THAT ASSESSEE HAS M ANUFACTURING FACILITY AT NOIDA FROM WHICH GOODS ARE MANUFACTURED AND EXPORTE D TO THE PLANT SITE AND THEN PLANTS ARE ERECTED AT THE RESPECTIVE SITE. TH EREFORE, IT CANNOT BE SAID THAT THE MANUFACTURING IS PERFORMED ONLY AT THE PLANT SI TE. FURTHER, LD. AR ALSO SUBMITTED THAT ON THE PRINCIPLE OF RULE OF CONSISTE NCY, THE ASSESSEE DESERVES DEDUCTION U/S 10B AS THE ASSESSEE WAS ALLOWED SUCH REDUCTION IN THE ASSESSMENT YEAR 2006-07. ALTHOUGH THE PRINCIPLE OF RES JUDICATA IS NOT APPLICABLE TO INCOME-TAX PROCEEDINGS BUT SUCH POSIT ION SHOULD NOT BE DEVIATED UNLESS THERE ARE CHANGE IN THE FACTS. IN THE ASSES SEES CASE, THERE IS NO CHANGE IN THE FACTS. THE QUANTUM OF DEDUCTION SHOULD NOT HAVE ANY BEARING ON THE ALLOWABILITY OF DEDUCTION U/S 10B IN VIEW OF THE RU LE OF CONSISTENCY. FOR THIS PROPOSITION, THE LEARNED AR RELIED ON THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF CIT VS. NEO POLY PACK P. LTD. 245 ITR 492 (DELHI) AND HON'BLE SUPREME COURT IN THE CASE OF RADHA SWAMI SA TSANG VS. CIT 193 ITR 321 (SC). LD. AR ALSO RELIED ON FOLLOWING DECI SIONS :- (I) CIT VS. JACKSON ENGINEERS LTD. (2010) 231 CTR (DE L.) 348; (II) CIT VS. TECH ELECTRONICS (2012) 67 DTR (GAU) 257; (III) CIT VS. CHIRANJEEVI WIND ENERGY LTD. (2011) 243 C TR MAD (195); (IV) CIT VS. ANAND AFFILIATES (2009) 221 CTR (P&H) 167 ; (V) CIT VS. MAHESH CHANDRA SHARMA (2009) 221 CTR (P&H ) 163; (VI) MIHIR ENGINEERS LIMITED VS. JCIT (2007) 112 TTJ ( MUMBAI) 940; (VII) SUBHASH CHANDER SEHGAL IA NO.1126 (DEL.)/2008 & 1 867 (DEL)/2008 DATED OF ORDER 27.02.2009. ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 9 LD. AR HAS ALSO DRAWN OUR ATTENTION TO THE DETAILED PROCESS FLOW DIAGRAM WHEREIN THE NATURE OF BUSINESS AND MANUFACTURING AC TIVITY HAS BEEN DESCRIBED IN DETAIL. FINALLY, HE RELIED ON THE ORDER OF THE CIT (A) AND PLEADED TO SUSTAIN THE ORDER OF CIT (A) AND DISMISS THE REVENUES APPE AL. 6. AFTER HEARING OF BOTH THE SIDES, WE HOLD THAT TH E ASSESSEE COMPANY WAS LOCATED IN 100% EOU SITUATED IN NOIDA EXPORT PROCES SING UNIT, NOIDA, U.P. THIS ZONE WAS CUSTOM BOUNDED AREA. THE DEVELOPMENT COMMISSIONER OF NOIDA EXPORT PROCESSING ZONE HAS EXTENDED ALL THE F ACILITIES AND PRIVILEGES ADMISSIBLE TO THE UNITS LOCATED IN THE EXPORT PROCE SSING ZONE IN VIEW OF THE EXPORT IMPORT POLICY 1997-2002 FOR THE ESTABLISHMEN T OF AN UNDERTAKING FOR MANUFACTURING OF ENGINEERING PRODUCTS WITH A CONDIT ION THAT ENTIRE PRODUCTION EXCLUDING REJECTS AND SALES IN THE DOMESTIC TARIFF AREAS PER PROVISIONS OF EXPORT AN IMPORT POLICY. THE ASSESSMENT FOR THE AS SESSMENT YEAR 2006-07 WAS COMPLETED U/S 143(3) OF THE INCOME-TAX ACT, 196 1 AND DEDUCTION U/S 10B WAS ALLOWED. THE ASSESSEE IS ENGAGED IN THE MANUFA CTURING OF SPECIAL PURPOSE PLANTS. THIS CONTENTION OF THE ASSESSEE WA S SUPPORTED BY INVOICE OF RAW MATERIAL, FREIGHT AND COURIER CHARGES FOR RECEI VING THE RAW MATERIAL AND EXPLAINING THE MANUFACTURING PROCESS. THE PROCESS FLOW CHART WAS FILED BEFORE ASSESSING OFFICER WHERE IN THE NATURE OF THE BUSINESS AND MANUFACTURING ACTIVITIES ARE DESCRIBED. THE CHART IS AS BELOW :- ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 10 ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 11 FURTHER THE FLOW CHART WAS EXPLAINED AS UNDER :- S.NO. DESCRIPTION OF COMPONENT MANUFACTURING PROCESS PERF ORMED BY THE APPELLANT 1. AC FREQUENCY DRIVE THE AC FREQUENCY DRIVE WAS PU RCHASED AS PER ASSESSEE'S DESIGN SPECIFICATIONS & INTEGRATED WITH A SQUIRREL CAGE MOTOR BY PROGRAMMING ITS PROGRAMMED LOGIC CONTROLLER (PLC) TO REQUIRED OPERATIONAL PARAMETERS AND MOUNTING IT ON MOTOR CONTROL PANEL; AFTER THE ABOVE SAID PROCESSING THE MANUFACTURED ITEM IS CALLED MOTOR SPEED CONTROLLER AND WAS SOLD AS SUCH VIDE OUR INVOICE DATED 19/08/2006. THE OTHER AC FREQUENCY DRIVES WERE SIMILARLY PROCESSED AND FIXED TO SCREW CONVEYOR FOR ITS STEP-LESS SPEED CONTROL. 2. (A) AERATION BOXES. (B) AERATION CLOTH. (C) AIR LIFT ASSEMBLY. (D) AIR LIFT WITH EXPANDER. (E) AIR SLIDES (F) ROTARY VANE FEEDER THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WERE ASSEMBLED INTO SUBASSEMBLIES & ASSEMBLIES TO MANUFACTURE PNEUMATIC MATERIAL CONVEYORS AND KILN FEEDING MECHANISM. THE EQUIPMENT ARE ASSEMBLED TOGETHER TO ENSURE EXACT MATING OF THE PARTS AND TESTED FOR EFFICIENCY BY INJECTING COMPRESSED AIR. THE LARGE SECTIONS ARE THEN DISASSEMBLED INTO SUBASSEMBLIES, PACKED AND CONTAINERIZED FOR SHIPMENT. FOR DETAILS LEASE REFER TO APPENDIX 1. 3. (A) INSTRUMENTS. (B) KILN HOOD. (C) NODULIZER FEED HOPPER & OVERFLOW SCREW CONVEYOR. (D) PNEUMATIC CYLINDER. (E) REFRACTORY BRICKS & POWDER. THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WERE ASSEMBLED INTO SUBASSEMBLIES & ASSEMBLIES TO MANUFACTURE VERTICAL SHAFT KILN. THE LARGE SECTIONS ARE THEN DISASSEMBLED INTO SUBASSEMBLIES, PACKED ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 12 (F) REPAIR KIT FOR CYLINDER (G) SCREW CONVEYOR (H) SETTLING CHAMBER (I) VSK GEARBOX AND ACCESSORIES (J) VSK SHELL AND CHIMNEY (K) NODULIZER AND CONTAINERIZED FOR SHIPMENT. FOR DETAILS PLEASE REFER TO APPENDIX 2. 4. (A) FORGED HYPER-STEEL (B) HOT AIR FURNACE (C) LINERS. (D) LINER BOLTS FOR CEMENT MILL. (E) LINER BOLTS FOR RAW MILL. (F) RAW MILL ACCESSORIES (G) RAW MILL PARTS. (H) GRIT SEPARATOR. THE EQUIPMENT MENTIONED IN THE COLUMN A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WERE ASSEMBLED INTO SUBASSEMBLIES & ASSEMBLIES TO MANUFACTURE RAW MILL & CEMENT MILL. THE LINERS ARE FITTED ON THE INNER SURFACE OF THE MILL SHELL USING THE NUTS AND BOLTS BEFORE FIXING THE END COVERS; THEY PREVENT WEAR OF THE MILL SHELL. THE LARGE SECTIONS ARE THEN DISASSEMBLED INTO SUBASSEMBLIES, PACKED AND CONTAINERIZED FOR SHIPMENT. FOR DETAILS PLEASE REFER TO THE APPENDIX 3 . 5. CYCLONE THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WAS PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION IT WAS ASSEMBLED WITH A HAMMER MILL USING SUPPORT AND FRAME; IT WORKS TO REDUCE POLLUTION BY TRAPPING DUST GENERATED BY THE HAMMER MILL. AFTER TESTING IT IS DISASSEMBLED FROM THE HAMMER MILL AND DISPATCHED AS CYCLONE SEPARATOR WITH SUPPORT AND EMBEDDED FRAME. FOR DETAILS PLEASE REFER TO THE APPENDIX 4 6. (A) BUCKET ELEVATOR PARTS (B) CHAIN FOR THE BUCKET ELEVATOR THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 13 WARE ASSEMBLED TOGETHER TO MAKE A BUCKET ELEVATOR, THE ELEVATOR WAS TESTED FOR CONFORMANCE WITH THE DESIGN PARAMETERS AND THEREAFTER DISASSEMBLED TO SHIPPABLE SIZE FOR SHIPMENT. FOR DETAILS PLEASE REFER TO APPENDIX 5 7. (A) BAGS OF DUST COLLECTOR. (B) SEQUENTIAL TIMER (C) SOLENOID VALVE THE EQUIPMENT MENTIONED IN THE COLUMN A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WERE ASSEMBLED TOGETHER TO MAKE A OUST COLLECTOR, THE OUST COLLECTOR WAS TESTED FOR CONFORMANCE WITH THE DESIGN PARAMETERS AND THEREAFTER DISASSEMBLED FOR SAFE SHIPMENT AS THEY ARE DELICATE ITEMS. FOR DETAILS PLEASE REFER TO APPENDIX 6 8. (A) TABLE FEEDER. (B) TABLE FEEDER THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WERE ASSEMBLED TOGETHER TO MAKE A MATERIAL PROPORTIONATOR BY ASSEMBLING WITH IT SCRAPPER, DRIVE SHAFT, GEARBOX, MOTOR ETC AND FIXING THE ASSEMBLY TO THE HOPPER; AFTER TESTING THE SYSTEM IS DISASSEMBLED INTO SUBASSEMBLY CALLED TABLE TYPE MATERIAL PROPORTIONATOR. FOR DETAILS REFER TO APPENDIX 7. 9. GRIT SEPARATOR THE EQUIPMENT MENTIONED IN THE CO LUMN 'A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WAS ASSEMBLED TOGETHER TO MAKE A COARSE PARTICLE CYCLONE WHICH IS FITTED IN THE RAW MILL SECTION TO PERFORM ITS DUTY OF RECYCLING UNDER DONE MATERIAL TO THE RAW MILL. FOR DETAILS PLEASE REFER TO APPENDIX 3 10. SLIDE GATE THE EQUIPMENT MENTIONED IN THE COLUMN 'A' OF THIS TABLE WAS PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION IT WAS ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 14 FIXED TO A HOPPER TO MAKE A MATERIAL CHARGING DOOR. FOR DETAILS PLEASE REFER TO APPENDIX 8 11. (A) MACC125A CURRENT COLLECTORS. (B) SAFETRACK2, SF 2-200A ALUMINUM SHROUDED CONDUCTOR SYSTEM. (C) M.S. FABRICATED SUPPORTS THE EQUIPMENT MENTIONED IN THE COLUMN A' OF THIS TABLE WERE PURCHASED BY ASSESSEE AS PER ITS TECHNICAL SPECIFICATIONS AND DRAWINGS AND AFTER INSPECTION THEY WAS ASSEMBLED TOGETHER TO MAKE A DOWN SHOP LEAD FOR THE ELECTRICALLY OPERATED TRAVELLING CRANE (EOT). AFTER TESTING FOR CURRENT CARRYING CAPACITY AND OTHER FACTORS THEY WERE DISASSEMBLED AND PROPERLY PACKED AS THERE ARE NUMBER OF SMALL COMPONENTS WHICH MAY GET MISPLACED DURING TRANSIT. IT IS THEN INSTALLED ON THE EOT AT THE PLANT SITE. FOR DETAILS PLEASE REFER TO THE APPENDIX 9. THUS, FACTS SHOW THAT THE PLANTS ARE SUPPLIED IN TH E FORM OF SUB-ASSEMBLIES AND COMPONENTS MANUFACTURED OR AFTER GETTING MANUFA CTURED AS PER THE PRESCRIBED SPECIFICATIONS. THESE SUB-ASSEMBLIES AN D COMPONENTS WERE MANUFACTURED OUTSIDE TRANSPORTED TO THE NSEZ, NOIDA AND THEREAFTER, CERTAIN OPERATIONS ARE CARRIED OUT AND DISASSEMBLING WAS DO NE PRIOR TO EXPORT THE SUBASSEMBLIES AND COMPONENTS TO THE ULTIMATE DESTIN ATION. THIS PROCESS IS ALSO REQUIRED FOR CONTAINERIZATION AND PACKING OF THESE ITEMS ON ACCOUNT OF SIZE WHICH IS NECESSARY FOR TRANSPORTATION AND INSTALLATION. IN THE CASE OF CIT VS. JACKSON ENGINEERS LTD., CITED SUPRA, THE HON'BLE DELHI HIGH COURT HAS HELD THAT ACTIVITY OF ASSEMBLING GENSETS FROM VARIOUS COMPONE NTS AMOUNT TO MANUFACTURE OR ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 15 PRODUCTION FOR THE PURPOSE OF DEDUCTION U/S 80IA. THE HON'BLE HIGH COURT HAS HELD AS UNDER:- DEDUCTION UNDER S. 80-IA MANUFACTURE OR PRODUCTI ON- ASSEMBLING OF DIESEL GENERATING SETS - ASSEMBLING O F VARIOUS COMPONENTS OF DIESEL GENERATING SETS INVOLVES COUPL ING AND ALIGNING THE ENGINE WITH THE ALTERNATOR CHAIN PUL LEY BLOCKS ARE USED TO LIFT THE ENGINE AND THE ALTERNATOR AT THE T IME OF COUPLING, AS THESE ARE VERY HEAVY COMPONENTS-AFTER THE COUPLI NG IS DONE, THE ENGINE AND THE ALTERNATOR ARE MOUNTED ON A BASE FRAME ENGINE AND THE ALTERNATOR ARE AFFIXED TO THE BASE F RAME BY MEANS OF NUTS AND BOLTS FITTED IN THE GROOVES-OTHER COMPO NENTS ARE FITTED TO COMPLETE THE DG SET - FUNCTION OF THE CON TROL PANEL IS TO INDICATE THE VOLTAGE AND THE CURRENT THAT IS GENERA TED-IT IS FITTED WITH SWITCHES AND INSTRUMENTS TO REGULATE AND CONTR OL THE POWER SUPPLY FUNCTION OF THE BATTERY IS TO PROVIDE THE INITIAL CURRENT REQUIRED TO START THE ENGINE AND THE FUNCTION OF TH E SILENCER IS TO DIMINISH THE SOUND OF I THE DG SET. WHEN IT RUNS WH ILE THE FUNCTION OF THE RADIATOR IS TO MAINTAIN THE TEMPERA TURE OF THE DG SET - ABOVE COMPONENTS CONSTITUTE THE INPUTS IN THE MANUFACTURE OF A DIESEL GENERATING SET DG SET IS THE FINAL PR ODUCT WHICH HAS A DISTINCTIVE NAME, CHARACTER AND FUNCTION DIFFEREN T FROM EACH OF THE COMPONENTS THEREFORE, THE ACTIVITY OF ASSEMBL ING GENSETS FROM VARIOUS COMPONENTS AMOUNTS TO MANUFACTURE OR P RODUCTION FOR THE PURPOSE OF DEDUCTION UNDER S. 80-IA JUDGM ENT OF DELHI HIGH COURT DT. 11TH AUG., 2009 IN IT APPEAL NO.149 OF 2001 FOLLOWED. IN THE CASE OF CIT VS. I. TECH ELECTRONICS, CITED S UPRA, THE HON'BLE GAUHATI HIGH COURT HAS HELD THAT PRODUCING OF TV SETS FOR P URCHASING AND ASSEMBLING ITEMS LIKE CHASSIS, IC, PICTURE TUBE, ETC. COULD BE HELD TO BE MANUFACTURING ACTIVITY AND, THEREFORE, THE ASSESSEE ENGAGE IN SUC H ACTIVITY IS ENTITLED TO DEDUCTION U/S 80IC. THE HON'BLE GAUHATI HIGH COURT HAS HELD AS UNDER :- ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 16 FOR THE ASSESSMENT YEAR 2004-05, THE ASSESSEE CLA IMED DEDUCTION UNDER SECTION 80-IC OF THE INCOME-TAX ACT , 1961 IN RESPECT OF INCOME DERIVED FORM ASSEMBLY OF COLOUR T ELEVISION SETS WHICH IT CLAIMED TO BE MANUFACTURING ACTIVITY FALLING UNDER SECTION 80-IC OF THE ACT. THE ASSESSING OFFI CER ALLOWED THE CLAIM BUT THE COMMISSIONER, EXERCISING JURISDIC TION UNDER SECTION 263 OF THE ACT, SET ASIDE THE ORDER DIRECTI NG THE ASSESSING OFFICER TO DISALLOW THE CLAIM OF THE ASSE SSEE ON THE GROUND THAT ASSEMBLING COMPONENTS AND TURNING THEM INTO TELEVISION SETS/COMPUTERS/DVD DID NOT AMOUNT TO MAN UFACTURE AS NO NEW ARTICLE DIFFERENT FROM THE RAW MATERIAL C AME INTO BEING. THE TRIBUNAL UPHELD THE VIEW THAT PRODUCING TELEVISION SETS BY PURCHASING ITEMS LIKE CABINETS, CHASIS, INT EGRATED CIRCUIT PICTURE TUBES, COULD BE HELD TO BE MANUFACTURING. ON APPEAL HELD, DISMISSING THE APPEAL, THAT THE VIEW OF THE T RIBUNAL WAS CORRECT. IN THE CASE OF CIT VS. CHIRANJJEEVI WIND ENERGY LTD ., CITED SUPRA, THE HON'BLE MADRAS HIGH COURT HAS HELD AS UNDER :- THE DIFFERENT PARTS PROCURED BY THE ASSESSEE BY TH EMSELVES CANNOT BE TREATED AS A WINDMILL. THOSE DIFFERENT PA RTS BEAR DISTINCTIVE NAMES AND WHEN ASSEMBLED TOGETHER, THER EAFTER IT GETS TRANSFORMED INTO AN ULTIMATE PRODUCT WHICH IS COMME RCIALLY KNOWN AS A 'WINDMILL'. THERE CAN, THEREFORE, BE NO DIFFICULTY IN HOLDING THAT SUCH AN ACTIVITY CARRIED ON BY THE ASS ESSEE WOULD AMOUNT TO 'MANUFACTURE' AS WELL AS 'PRODUCTION' OF A THING OR ARTICLE AS SET OUT IN S. 80-IB(2)(III). IN SUCH CIR CUMSTANCES, THE CONCLUSION OF THE TRIBUNAL IN ACCEPTING THE PLEA OF THE ASSESSEE CANNOT BE FOUND FAULT WITH.-INDIA CINE AGENCIES VS. CIT (2008) 220 CTR (SC) 223 : (2008) 15 DTR (SC) 121 : (2009) 308 ITR 98 (SC) APPLIED. THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. ANAND AFFILIATES, CITED SUPRA, HAS HELD AS UNDER :- ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 17 THE TRIBUNAL HAS DISCUSSED THE NATURE OF RAW MATER IALS AND THE PROCESS CONDUCTED BY THE ASSESSEE RESULTING IN PROD UCTION OF AUTOMOBILE FILTER ELEMENT, WHICH IS SUPPLIED TO THE AUTOMOBILE MANUFACTURER. THE ASSESSEE BRINGS TOGETHER VARIOUS RAW MATERIALS AND AFTER CARRYING OUT PROCESS, ASSEMBLES THE SAME LEADING TO' THE EQUIPMENT BEING PRODUCED. IT IS WEL L SETTLED THAT EVERY CHANGE OR PROCESS CANNOT BE TERMED AS MANUFAC TURE OR PRODUCTION. WELL KNOWN TESTS APPLIED FOR DETERMININ G WHETHER A PROCESS AMOUNTED TO MANUFACTURE OR PRODUCTION ARE T HAT A NEW AND DISTINCT COMMERCIAL PRODUCT IS PRODUCED. IN EAC H CASE, IT MAY BE A QUESTION OF FACT WHETHER A PARTICULAR PROC ESS INVOLVES MANUFACTURE OR NOT. THE QUESTION MAY BE OF DEGREE A ND EXTENT OF CHANGE AND THOUGH THE ISSUE MAY AT TIMES BE DEBATAB LE, BY APPLYING THE RELEVANT TESTS, THE TRIBUNAL HAS RECOR DED A FINDING AND SUCH FINDING CANNOT BE HELD TO BE PERVERSE, IT CANNOT BE HELD THAT A SUBSTANTIAL QUESTION OF LAW ARISES. THE TRIB UNAL HAS APPLIED THE CORRECT TEST AND RECORDED A FINDING THA T THE PROCESS UNDERTAKEN BY THE ASSESSEE INVOLVED MANUFACTURE. ME RELY BECAUSE A DIFFERENT VIEW CAN BE TAKEN WILL NOT BE A GROUND TO HOLD THAT A SUBSTANTIAL QUESTION OF LAW ARISES.-ANA ND AFFILIATES VS. ITO (2007) 108 TIJ (CHD) 877 AFFIRMED; CIT VS. MAHESH CHANDRA SHARMA (2009) 221 CTR (P&H) 163: (2009) 308 ITR 222 (P&H) FOLLOWED. IN THE CASE OF CIT VS. MAHESH CHANDRA SHARMA, CITED SUPRA, THE HON'BLE PUNJAB & HARYANA HIGH COURT HAS HELD AS UNDER :- MOTORCYCLE WHEEL ASSEMBLED BY ASSESSEE BY USING RI M, TUBE, TYRE, BEARING, DRUM, SPOKE, NIPPLE AND COLLAR RESUL TED IN AN ARTICLE DISTINCT IN NAME, CHARACTER AND USE HENCE ' MANUFACTURE' ELIGIBLE FOR DEDUCTION UNDER S. 80-IB; FINDING ARRI VED AT BY TRIBUNAL IS A FINDING OF FACT NOT GIVING RISE TO AN Y SUBSTANTIAL QUESTION OF LAW. THE HON'BLE MUMBAI HIGH COURT IN THE CASE OF MIHIR ENGINEERS LIMITED VS. JCIT, CITED SUPRA, HAS HELD AS UNDER :- ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 18 THE MANUFACTURING PROCESSES OF CROSS FLOW AND COUN TER FLOW TYPES OF COOLING TOWERS ARE WET TYPE OF COOLING TOW ARDS MANUFACTURED IN TECHNICAL COLLABORATION WITH GEA. T HE IMPORT OF KNOW-HOW AND THE ESTABLISHMENT OF THE NEW UNIT W AS TECHNICALLY FOR THE PRODUCTION OF THE XE SERIES AND CM SERIES OF COOLING TOWERS WHICH AS CLAIMED BY THE ASSESSEE COM PANY ARE BEING MANUFACTURED IN TECHNICAL COLLABORATION WITH GEA, WHEREAS THE ROUND BOTTLE COOLING TOWERS ARE BEING M ANUFACTURED INDEPENDENT OF THE COLLABORATION WITH GEA THEREBY U SING ITS OLD PLANT AND MACHINERY AND MOULDS SHIFTED FROM ODHAV U NIT. THE MANUFACTURING PROCESS OF COMPONENTS FOR ROUND BOTTL E COOLING TOWERS AND COUNTER FLOW/CROSS FLOW COOLING TOWERS A RE DISTINCT AND INDEPENDENT AS THE ITEMS MANUFACTURED BY EACH T YPE GO TO ASSEMBLE DIFFERENT TYPES OF COOLING TOWERS. SAME IS CORROBORATED BY THE FACT THAT THE ASSESSEE HAS ENTERED INTO A CO LLABORATION AGREEMENT WITH GEA FOR THE MANUFACTURE OF CROSS FLO W AND COUNTER FLOW TYPES OF COOLING TOWERS. THE TECHNICAL KNOW-HOW HAS BEEN OBTAINED FOR THE PURPOSE OF MANUFACTURE OF COMPONENTS OF CROSS FLOW AND COUNTER FLOW TYPES OF COOLING TOW ERS FOR THE PURPOSE OF WHICH GEA STANDS GUARANTEE. THE ASSESSEE IN ORDER TO CONSOLIDATE ITS MANUFACTURING ACTIVITIES UNDER O NE ROOF HAD TRANSFERRED THE OLD UNIT MANUFACTURING ROUND BOTTLE COOLING TOWERS IN ENTIRETY TO THE NEW UNIT. THE MANUFACTURI NG OF COMPONENTS FOR ROUND BOTTLE COOLING TOWERS IS AN IN DEPENDENT PROCESS WHICH IS NOT PART AND PARCEL OF THE COLLABO RATION WITH GEA. THE ASSESSEE HAS ALREADY AVAILED BENEFITS UNDE R S. 80-IA IN RESPECT OF ITS UNIT MANUFACTURING ROUND BOTTLE C OOLING TOWERS AND THERE IS NO MERIT IN ITS CLAIM FOR CLAIMING BEN EFIT OF DEDUCTION UNDER S. 80-IA IN RESPECT OF COMPONENTS M ANUFACTURED FOR ROUND BOTTLE COOLING TOWERS. THE PERUSAL OF THE FACTS OF THE CASE CLEARLY REVEAL THAT THE ASSESSEE HAS ESTABLISH ED A NEW UNIT FOR THE MANUFACTURING OF COMPONENTS OF XE SERIES AN D CM SERIES OF COOLING TOWERS IN COLLABORATION WITH GEA, WHICH IS AN INDEPENDENT UNIT. IN RESPECT OF THE MANUFACTURING A CTIVITIES CONNECTED WITH COMPONENTS OF RB SERIES OF COOLING T OWERS, THE MOULDS AND PLANT AND MACHINERY INITIALLY UTILIZED F OR THE PURPOSE HAVE BEEN SHIFTED FROM THE OLD UNIT TO THE NEW UNIT FOR THE PURPOSE OF BETTER CONTROL AND MANAGEMENT. THE ASSES SEE IS ENTITLED TO THE CLAIM OF DEDUCTION UNDER S. 80-IA I N RESPECT OF COMPONENTS MANUFACTURED IN RESPECT OF XE SERIES AND CM SERIES ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 19 OF COOLING TOWERS. THE ASSESSEE IS NOT ENTITLED TO THE BENEFIT OF DEDUCTION UNDER S. 80-IA IN RESPECT OF MANUFACTURE OF COMPONENTS OF RB SERIES OF COOLING TOWERS. THE CONT ENTION OF THE ASSESSEE IS THAT IT HAD SHIFTED ONLY 11 PER CEN T OF TOTAL VALUE OF PLANT AND MACHINERY FROM OLD UNIT TO BE PART OF THE NEW UNIT HAS NO RELEVANCE IN VIEW OF THE FINDING THAT THE MA NUFACTURE OF COMPONENTS FOR RB SERIES IS INDEPENDENT OF MANUFACT URE OF COMPONENTS FOR XE AND CM SERIES. CONSIDERING THE PLEADINGS OF ASSESSEE AND CASE LAWS RELIED UPON AND ALSO THE FACTS OF THE CASE, WE FIND THAT ASSESSEE WAS ENGAGE D IN THE MANUFACTURING OF ASSEMBLING THE PLANTS WHICH WERE DISASSEMBLED FOR E XPORTS. CONSIDERING THESE FACTS, WE FIND THAT THE CIT (A) WAS JUSTIFIED IN GRANTING THE RELIEF TO THE ASSESSEE. 7. IN THE RESULT, THE APPEALS OF THE REVENUE FOR BO TH THE ASSESSMENT YEARS ON THIS ISSUE STAND DISMISSED. 8. IN CROSS OBJECTION NO.193/DEL/2012 IN ITA NO.183 3/DEL/2012 FOR THE ASSESSMENT YEAR 2008-09, THE ONLY ISSUE INVOLVED IS CONFIRMING THE DISALLOWANCE OF EXPENDITURE OF RS.3,14,240/- ON PRO PORTIONATE BASIS U/S 14A READ WITH RULE 8 D OF THE INCOME TAX RULES. WE HAV E HEARD BOTH THE SIDES ON THE ISSUE. ON THIS ISSUE, THERE IS A DECISION O F HON'BLE DELHI HIGH COURT IN THE CASE OF MAXOPP INVESTMENT LTD. VS. CIT [2011] 203 TAXMANN 364 (DELHI). IN VIEW OF THIS, THE ISSUE IS SET ASIDE T O THE FILE OF THE ASSESSING OFFICER TO DECIDE DE NOVO. IN THE RESULT, THE CROS S OBJECTION IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO.880/DEL./2011 ITA NO.1833/DEL./2012 CO NO.51/DEL/2011 CO NO.193/DEL/2012 20 9. IN THE CROSS OBJECTION NO.51/DEL/2011 IN ITA NO. 880/DEL/2011, IN THE GROUND NO.1, THE ISSUE INVOLVED IS NOT ADMITTING OF ADDITIONAL EVIDENCES UNDER RULE 46A OF INCOME TAX RULES. WE HAVE HEARD BOTH T HE SIDES. THIS ISSUE IS NOT PRESSED AT THE TIME OF THE HEARING AND THE SAME IS DISMISSED. 10. THE GROUND NO.2 IN THE CROSS OBJECTION NO.51/DE L/2011 IS REGARDING NOT DELETING THE ADDITION OF RS.46,643/- MADE ON AC COUNT OF SHORT TERM CAPITAL GAIN. THIS ISSUE WAS ALSO NOT PRESSED, HENCE THE S AME IS ALSO DISMISSED. 11. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE ARE DISMISSED AND THE CROSS OBJECTIONS FILED BY THE ASSESSEE IS PARTLY AL LOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 18 TH DAY OF APRIL, 2013. SD/- SD/- (C.M. GARG) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 18 TH DAY OF APRIL, 2013 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A) 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.