The Assistant Commissioner of Income Tax, Circle-2, Dibrugarh V. OIL india Ltd., Dibrugarh

ITA 122/GTY/2008

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4582 (ITAT-GUWAHATI)
• Duration Of Justice: 11 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 15-05-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJOY SHARMA; H B MAHANTA; RINZEE LHAMU SHERPA
• Keywords: Non passing of speaking order; Deduction Disallowance
• Section: 10; 154; 44AD; 143(3); 80IB; 80IA; 80IC; 80HH; 44BB

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL GUWAHATI BENCH, GUWAHATI BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L. SAINI, ACCOUNTANT MEMBER ITA NO. 120 TO 123 / GAU / 2008 ASSESSMENT YEARS :2003-04 TO 2006-07 ACIT, CIRCLE-2, DIBRUGARH, KARTICKPARA, DIBRUGARH, ASSAM-786008 V/S . OIL INDIA LTD., DULIAJAN DIST. DIBRUGARH, ASSAM PIN-786602 [ PAN NO. AAACO 2352 C ] /APPELLANT .. / RESPONDENT ITA NO. 87 / GAU / 2010 ASSESSMENT YEAR :2007-08 ITA NO.33/GAU/2018 ASSESSMENT YEAR:2008-09 ITA NO. 325/GAU/2013 ASSESSMENT YEAR: 2009-10 ITA NO.09/GAU/2014 ASSESSMENT YEAR: 2010-11 OIL INDIA LTD., P.O. DULIAJAN DIST. DIBRUGARH, ASSAM-786602 [ PAN NO. AAACO 2352 C ] V/S . ACIT, CIRCLE-2, DIBRUGARH, KARTICKPARA, DIBRUGARH, ASSAM /APPELLANT .. / RESPONDENT /BY ASSESSEE SHRI GAURAV JAIN FCA & SHRI DEEPESH JAIN, FCA /BY RESPONDENT SHRI SANJOY SARMA, SR. S.C. SHRI. H.B. MAHANTA, PRINCIPAL CIT DIBRUGARH MRS. RINZEE LHAMU SHERPA, ACIT /DATE OF HEARING 05-07-2019 /DATE OF PRONOUNCEMENT 28-08-2019 / O R D E R ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 2 PER S.S.GODARA, JUDICIAL MEMBER:- THESE REVENUE AND ASSESSEES EIGHT APPEAL(S) ARISE AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-SHILLOLNGS CO MMON ORDER DATED 29.02.2008 FOR ASSESSMENT YEAR(S) 2003-04 TO 2006-0 7 PASSED IN CASE NO.23,24-DIB/05-06, 28 & 29-DIB/2007-08 AND SEPARAT E ORDERS DATED 23.04.2010, 13.12.2017, 28.02.2013 & 06.11.2013 FOR LATTER AS MANY ASSESSMENT YEAR(S) 2007-08 TO 2010-11 IN CASE NOS. DBR-8/2008-09, DBR- 4/2010-11, DBR-33/2011-12 & DBR-14/2012-13 INVOLVED PROCEEDINGS U/S 143(3) IN ALL CASES EXCEPT IN ASSESSMENT YEAR 2009- 10 U/S 251 R.W.S. 154 OF THE INCOME TAX ACT, 1961; IN SHORT AS THE ACT; RE SPECTIVELY. HEARD SHRI SANJAY SARMA, SENIOR STANDING COUNSEL, S HRI H.B. MAHANTA, PRINCIPAL CIT,DIBRUGARH AND MRS. RINNEE SH ERPA, ACIT PRESENT (INCUMBENT ASSESSING OFFICER) REPRESENTING THE DEPARTMENT AND S/SHRI GAURAV JAIN AND DEEPESH JAIN APPEARING F OR THE ASSESSEE. 2. IT TRANSPIRES AT THE OUTSET FROM A COMBINED PERU SAL OF THE REVENUE AND ASSESSEES PLEADINGS IN THEIR RESPECTIVE FOUR CASES EACH THAT THE SOLE ISSUE THAT ARISES FOR OUR APT ADJUDICATION IS OF THE LATT ERS ELIGIBILITY TO CLAIM U/S 80IB DEDUCTION IN FORMER TWO AND SEC. 80IC DEDUCTION IN THE REMAINING SIX ASSESSMENT YEAR(S) INVOLVING CORRESPONDING DEDUCTIO N CLAIMS READ AMOUNT(S) 62,07,27,070/-, 171,79,78,604/-, 369,60,15,777, 1174,87,15,092/-, 1,149,57,71,017/-, 1572,02,31,395/-, 1626,49,31,357/- AND 186,677,04,350/-; ASSESSMENT YEAR-WISE RESPECTIVELY . 3. LEARNED REPRESENTATIVE(S) INFORM US VERY FAIRLY THAT THE REVENUES FOUR APPEAL(S) IN ASSESSMENT YEAR(S) 2003-04 TO 2006-07 ARISE AGAINST THE CIT(A)S COMMON ORDER HOLDING THE TAXPAYER AS ELIGI BLE FOR SEC. 80IB DEDUCTION IN RELATION TO ITS PROFIT DERIVES FROM T HE ELIGIBLE UNDERTAKING I.E. NEW OIL WELLS TAKEN ON STANDALONE BASIS. THE ASSESSING OFFICERS IDENTICAL FOUR ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 3 FOLDED REASONING IN HIS SEPARATE ASSESSMENT ORDER( S) DECLINED THE SAME INTER ALIA ON THE GROUND THAT THE TAXPAYERS OIL WELLS I N ISSUE WERE NOT NEW INDUSTRIAL UNDERTAKING(S) IT DID NOT COMPLY WITH RULE 18BBB(2) OF THE INCOME TAX RULES, 1962 REQUIRING A SEPARATE REPORT ACCOMPANIED BY THE PROFIT AND LOSS ACCOUNT AND BALANCE-SHEET OF THE ELIGIBLE UNDERTAKING AS IF IT IS A DISTINCT ENTITY, ITS PLANT AND MACHINERY USED IN THE OIL WELLS HAD BEEN PREVIO USLY PUT TO USE FOR OTHER PURPOSES AND FORM 10CCB AUDITOR REPORT HAD NOT BEEN FIELD ALONGWITH THE RETURN; RESPECTIVELY. ALL THIS RESULTED IN DISALLOW ANCE(S) OF ASSESSEES ABOVE STATED CORRESPONDING DEDUCTION CLAIM(S) RAISED IN F ORMER FOUR ASSESSMENT YEAR(S). 4. THE CIT(A)S COMMON ORDER UNDER CHALLENGE IN THE SE FORMER FOUR ASSESSMENT YEAR(S) REVERSES THE ASSESSING OFFICERS ACTION AS FOLLOWS:- (A) DISALLOWANCE OF DEDUCTION UNDER SECTION 80IB/80 IC OF THE ACT AY:2003-04, 2004-05, 2005-06 AND 2006-07 FOR THE ASSESSMENT YEARS 2003-04, THE APPELLANT BA SED ITS CLAIM AS AN ALLOWABLE DEDUCTION UNDER SECTION 80IB OF THE ACT. FOR THE SU BSEQUENT ASSESSMENT YEARS VIZ. 2005-06 AND 2006-07 THE ASSESSEE CLAIMED SUCH DEDUC TION UNDER SECTION 80IC OF THE ACT. SUCH DEDUCTION WAS CLAIMED IN RESPECT OF E ACH OF THE OIL WELLS WHICH WERE CONSTRUCTED BY THE ASSESSEE AND FOR WHICH CAPITAL E MPLOYED IN RESPECT OF EACH SUCH OIL WELL HAS BEEN SEPARATELY ACCOUNTED FOR IN THE A CCOUNTS AS WELL AS THE EXPENDITURE INCURRED IN RESPECT OF OIL WELL INCLUDING SALARIES GIVEN TO THE EMPLOYEES WAS ALSO SEPARATELY ACCOUNTED FOR IN THE ACCOUNTS OF THE ASS ESSEE. THE ASSESSEE SUBMITTED THE AUDIT REPORT IN FORM NO.10CCB ALONG WITH THE CO MPUTATION OF PROFIT AND LOSS WITH REGARD TO EACH OIL WELL ( FORMING PART OF THE AUDIT REPORT ) IN THE COURSE OF HEARING. THE ASSESSING OFFICER (AO), HOWEVER, DISALLOWED SUC H CLAIM UNDER SECTION 80IB AND ALSO UNDER SECTION 80IC FOR THE RESPECTIVE YEARS ON , INTER ALIA, THE FOLLOWING GROUNDS:- A) THE ASSESSEES OIL WELLS FOR WHICH THE CLAIM IS MADE, IS NOT AN NEW INDUSTRIAL UNDERTAKING OR ENTERPRISE; THOUGH THERE IS NO DISPU TE THAT THESE ARE PLANTS. B) AS PER SUB RULE (2) OF RULE 18BBB OF THE INCOME TAX RULES, A SEPARATE REPORT IS TO BE FURNISHED BY AN UNDERTAKING OR ENTERPRISE CLA IMING DEDUCTION UNDER SECTION 80IC AND ALSO AS PER SUB-RULE (2) OF RULE 18BBB SEP ARATE BOOKS OF ACCOUNT SHOULD BE MAINTAINED IN RESPECT OF ALL THESE WELLS AS EACH WELL IS A DISTINCT ENTITY BUT NO SUCH SEPARATE BOOKS OF ACCOUNT HAVE BEEN MAI NTAINED BY THE ASSESSEE IN RESPECT OF THESE OIL WELLS; C) ACCORDING TO THE PROVISIONS OF CLAUSE (II) OF SU B-SECTION (4) OF SECTION 80IC AN UNDERTAKING SHOULD NOT BE FORMED BY THE TRANSFER TO A NEW BUSINESS OF MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE. HOWEVER T HE ASSESSEE HAS USED COMMON ASSETS LIKE DRILLING RIG, GENUINENESS SET AN D OTHER COMMON MOVABLE ASSETS. ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 4 D) SEPARATE AUDIT REPORT IN FORM 10CCB HAS NOT BEEN SUBMITTED FOR EACH WELL ALONGWITH THE RETURN OF INCOME. THE AUTHORIZED REPR ESENTATIVE (AR), DR. DEBI PAL, SR. ADVOCATE APPEARING ON BEHALF OF THE APPELLANT S UBMITTED THAT UNDER SECTIONS 80IB AND 80IC WHERE THE GROSS TOTAL INCOME OF AN AS SESSEE INCLUDES ANY PROFITS AND GAINS DERIVED BY AN UNDERTAKING OR AN ENTERPRIS E FROM ANY BUSINESS REFERRED TO IN SUB-SECTION (2) THERE SHALL BE IN ACCORDANCE WITH AND SUBJECT TO THE PROVISIONS OF THIS SECTION BE ALLOWED IN COMPUTING THE TOTAL INCOME OF THE ASSESSEE A DEDUCTION FROM SUCH PROFITS AND GAINS AS SPECIFIED IN SUB-SECTION (3). IN ORDER TO CLAIM SUCH BENEFIT THE FOLLOWING CONDIT IONS ARE TO BE SATISFIED:- A) THE BENEFIT IS AVAILABLE TO AN UNDERTAKING OR EN TERPRISE; B) SUCH UNDERTAKING OR ENTERPRISE BEGINS TO MANUFAC TURE OR PRODUCE ANY ARTICLE OF THING NOT BEING ANY ARTICLE OR THING SPECIFIED I N RESPECT TO THE THIRTEEN SCHEDULE; C) THE SAID SECTION APPLIES IF THE CONDITIONS SPECI FIED IN SUB-SECTION (4) OF SECTION 80IC APPLIES. THE CONDITIONS SET OUT THEREIN INCLUDES INTER ALIA THAT THE UNDERTAKING OR ENTERPRISE IS NOT FORMED BY SPLITTING UP OR THE REC ONSTRUCTION OF A BUSINESS ALREADY IN EXISTENCE. IT IS NOT FORMED BY THE TRANSFER TO A NEW BUSINESS OF MACHINERY OR PLANT PREVIOUSLY USED FOR ANY PURPOSE BY AN ASSESSE E. EXPLANATION TO SECTION 80IC(4) LAYS DOWN THAT THE P ROVISIONS OF EXPLANATIONS 1 AND 2 TO SUB-SECTION (3) OF SECTION 80IA SHALL APPL Y FOR THE PURPOSES OF CLAUSE (II) OF SECTION 80IC(4) AS THEY APPLY FOR THE PURPOSES O F CLAUSE (II) OF THAT SUB-SECTION. EXPLANATION 2 TO SECTION 80IA(3) MAKES IT CLEAR THA T WHERE IN THE CASE OF AN UNDERTAKING ANY MACHINERY OR PLANT OR ANY PART THER EOF PREVIOUSLY USED FOR ANY PURPOSE IS TRANSFERRED TO A NEW BUSINESS AND THE TO TAL VALUE OF THE MACHINERY OR PLANT OR PART SO TRANSFERRED DOES NOT EXCEED 20% OF THE TOTAL VALUE OF THE MACHINERY OR PLANT USED IN THE BUSINESS, THEN FOR T HE PURPOSES OF CLAUSE (II) OF THIS SUB-SECTION, THE CONDITION SPECIFIED THEREIN S HALL BE DEEMED TO HAVE BEEN COMPLIED WITH. ON THE ABOVE PREMISES OF THE LAW, THE AR SUBMITTED THE PARA-WISE WRITTEN SUBMISSION DURING THE COURSE OF HEARING ON EACH OF THE CONTENTIONS OF THE AO WHICH ARE SUMMARISED AS UNDER: (A) THE QUESTION, AS TO WHETHER AN OIL WELL IS AN U NDERTAKING FOR THE PURPOSE OF SECTION 80IC OF THE ACT IS TO BE CONSIDERED FIRST. AN UNDERTAKING IS NOT DEFINED UNDER THE ACT. IN AIR 1960 SC 610 AT PAGE 616, PARA 17, THE SUPREME COURT POINTED OUT THAT IT HAS TO DECIDE WHAT ARE THE ATTR IBUTES, THE PRESENCE OF WHICH, MAKES AN ACTIVITY AN UNDERTAKING WITHIN THE MEANING OF SECTION 2(I) OF THE INDUSTRIAL DISPUTE ACT. AS A WORKING PRINCIPLE IT MAY BE STAYED THAT AN ACTIVITY SYSTEMATICALLY OR HABITUALLY UNDERTAKEN FO R THE PRODUCTION OR DISTRIBUTION OF GOODS OR FOR RENDERING OF MATERIAL SERVICE TO THE COMMUNITY AT LARGE OR A PART OF SUCH COMMUNITY WITH THE HELP OF THE EMPLOYEE IS AN UNDERTAKING. IN THE CASE OF TEXTILE CORPORATION LTD. VS. CIT REP ORTED IN 107 ITR 195, THE QUESTION ASKED WAS WHAT CONSTITUTES A NEW INDUSTRIA L UNDERTAKING WHICH IS ELIGIBLE FOR DEDUCTION UNDER SECTION 15C OF THE INC OME TAX ACT, 1922 ( CORRESPONDING PROVISION IS 80J AND 84 ). THE SUPREME COURT POINTED OUT AT PAGE 204 THAT A NEW INDUSTRIAL UNDERTAKING SHOUL D BE SEPARATE PHYSICALLY FROM THAN THE OLD ONE, THE CAPITAL OF WHICH AND THE PROFITS THEREON ARE ASCERTAINABLE. THE SUPREME COURT FURTHER POINTED OU T, THAT A NEW UNDERTAKING MUST BE AN INTEGRATED UNIT BY ITSELF WHEREIN ARTICL ES ARE PRODUCED AND AT LEAST ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 5 A MINIMUM OF 10 PERSONS, WITH THE AID OF POWER AND A MINIMUM 20 PERSONS WITHOUT THE AID OF POWER HAVE BEEN EMPLOYED. SUCH A NEW INDUSTRIALLY RECONGNIZABLE UNIT OF AN ASSESSEE CANNOT BE SAID TO BE RECONSTRUCTION OF HIS OLD BUSINESS SINCE THERE IS NO TRANSFER OF ANY ASSE TS OF THE OLD BUSINESS TO THE NEW UNDERTAKING WHICH TAKES PLACE WHEN THERE IS REC ONSTRUCTION OF THE OLD BUSINESS. THE INDUSTRIAL UNIT AND BE TREATED AS A N EW INDUSTRIAL UNDERTAKING IF THE UNDERTAKING IS NEW IN THE SENSE THAT THE NEW PL ANT AND MACHINERY ARE ERECTED FOR PRODUCING EITHER THE SAME COMMODITIES O R SOME DISTINCT COMMODITIES. THE SUPREME COURT FURTHER POINTED OUT THAT IN ORDER TO CLAIM THE BENEFIT OF SECTION 15C OF THE 1922 ACT THE FOLLOWIN G CONDITIONS ARE TO BE ESTABLISHED- A. INVESTMENT OF SUBSTANTIAL FRESH CAPITAL IN THE I NDUSTRIAL UNDERTAKING SET UP; B. EMPLOYMENT OF REQUISITE LABOUR THEREIN; C. MANUFACTURE OR PRODUCTION OF ARTICLES IN THE SAI D UNDERTAKING; D. EARNING OF PROFITS CLEARLY ATTRIBUTABLE TO THE S AID NEW UNDERTAKING AND E. ABOVE ALL, A SEPARATE AND DISTINCT IDENTITY OF T HE INDUSTRIAL UNIT SET UP. ACCORDING TO WEBSTER DICTIONARY THE WORD UNDERTAKING MEANS ANYTHING UNDERTAKEN, ANY BUSINESS, WORK OR PROJECT TO WHICH ONE ENGAGES IN OR ATTEMPTS, AN ENTERPRISE ETC. APPLYING THE ABOVE TESTS, EACH OIL WELL APPEARS TO SATISFY THE TEST OF UNDERTAKING FOR THE PURPOSE OF SECTION 80IB/80IC OF THE ACT. EACH OIL WELL IS A DISTINCT, SEPARATE AND INTEGRATED UNIT FOR WHICH CAPITAL IS SEPARATELY EMPLOYED AND THE EXPENSES INCURRED ARE SEPARATELY A CCOUNTED FOR. EACH OIL WELL PRODUCES CRUDE OIL AND NATURAL GAS AND THEREFO RE IT SATISFIES ALSO ONE OF THE TESTS FOR THE PURPOSE OF CLAIMING THE BENEFIT O F SECTION 80IB & 80IC. (B) REGARDING MAINTENANCE OF SEPARATE SET OF ACCOU NTS, THE AR SUBMITTED THAT EVEN THOUGH THE ASSESSEE MAINTAINS COMPOSITE ACCOUN TS THE CAPITAL EMPLOYED FOR EACH OF THE OIL WELL IS SEPARATELY SHO WN IN THE ACCOUNTS AND THE EXPENDITURE INCURRED FOR EACH OIL WELL IS ALSO SEPA RATELY SHOWN IN THE ACCOUNT. IN FACT, THE AUDIT REPORT WHICH HAS TO BE SUBMITTED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT, SEPARATELY SHOWS THE CAPITAL EMPLOYED AS WELL AS THE EXPENSES INCURRED FOR EACH OIL WELL AND ASCERTAINS AND COMPUTES THE PROFITS ATTRIBUTABLE TO EACH OIL WELL. IN OTHER WORDS, THE AUDITOR IN HIS REPORT HAS SEPARATELY ASCERTAINED THE PROFIT ATTRIBUTABLE TO E ACH OIL WELL AND HAS GIVEN HIS REPORTED SEPARATELY FOR EACH WELL THE CAPITAL EMPLO YED, EXPENDITURE INCURRED, QUANTITY OF THE OIL PRODUCED, SALE VALUE OF EACH OI L WELL, PRODUCTION COST OF EACH OIL WELL, TOTAL COST THEREBY ASCERTAINING FROM THE BOOKS OF ACCOUNT OF THE APPELLANT THE PROFITS WHICH ARE ATTRIBUTABLE TO EAC H OIL WELL. THE LAW DOES NOT REQUIRE THAT SEPARATE ACCOUNTS BE MAINTAINED FOR EA CH OF THE UNDERTAKINGS FOR WHICH THE CLAIM UNDER SECTION 80IB/80IC IS TO BE AL LOWED. THE OTHER POINT, THAT SEPARATE ACCOUNTS ARE TO BE M AINTAINED AS POINTED OUT BY THE AO, IS NOT A REQUIREMENT OF THIS SECTION. TH E GAUHATI HIGH CURT HAS CATEGORICALLY HELD IN THE CASE OF CIT VS.TECHNOTIVE EASTERN PVT. LTD. REPORTED IN 255 ITR 253 AT PAGE 255, THAT FOR THE PURPOSE OF CLAIMING RELIEF UNDER SECTION 80HHH AND SECTION 80I, THE LAW DOES NOT REQ UIRE THAT SEPARATE ACCOUNTS ARE TO BE MAINTAINED FOR CLAIMING DEDUCTIO N UNDER THE AFORESAID PROVISIONS. THE PROVISIONS OF SECTION 80IC ARE SIMI LAR IN THAT THE ONLY REQUIREMENT IS THAT THEE PROFIT OF THE CONCERN OR T HE UNDERTAKING IS TO BE SEPARATELY ASCERTAINABLE, AND THEREFORE THE REPORT OF THE AUDITOR GIVING SUCH SEPARATE PROFIT ( ASCERTAINABLE FROM, EACH OIL WELL ) IS SUFFICIENT COMPLIANCE WITH THE SECTION. THE AFORESAID DECISION OF THE GAU HATI HIGH COURT IS BINDING ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 6 UPON ALL AUTHORITIES WITHIN THE JURISDICTION OF THE HIGH COURT. THE SAME VIEW HAS BEEN SUBSEQUENTLY FOLLOWED BY THE GAUHATI HIGH COURT IN THE CASE OF BONGAIGAON REFINERY & PETROCHEMICALS LTD. VS. CIT R EPORTED IN 274 ITR 379. THIS VIEW HAS BEEN SUPPORTED IN CATENA OF JUDICIAL DECISIONS. 104 ITR 101 (CAL) AT PAGE 104 120 ITR 110 (CAL) AT PAGE 120 190 ITR 553 (ALL) AT PAGES 555 (C) REGARDING THE ASSERTIONS OF THE AO THAT THE UND ERTAKING HAS BEEN FORMED BY TRANSFER OF ASSETS, THE AR SUBMITTED THAT THE ASSES SEE HAS NOT TRANSFERRED ANY PLANT OR MACHINERY WHICH WAS FORMERLY USED BY T HE ASSESSEE. IN FACT, IN EACH OIL WELL, ONLY NEW PLANT OR MACHINERY HAS BEEN USED AND CONSTRUCTED FOR THE PURPOSE OF PRODUCING THE CRUDE OIL AND NATU RAL GAS FROM THE SAID OIL WELLS. IT IS INCORRECT TO MAINTAIN THAT THE PLANT A ND MACHINERY WHICH WAS USED EARLIER IN THE BUSINESS HAS BEEN TRANSFERRED TO EAC H OF THE NEW OIL WELLS. WHAT HAS BEEN SHOWN, S AT THE TIME OF EXPLORATION, MACHI NERY LIKE DRILLING RIGS, GENUINENESS-SETS ETC. WHICH ARE USED FOR EXPLORATIO N PURPOSES AND FOR BORING THE SUCCESSFUL WELL, ARE A NEW UNDERTAKING IN THAT THE WELL IS SET UP BY THE USE OF NEW PLANT AND MACHINERY AND WITH SEPARATE EXPENS ES TO PRODUCE THE OIL AND NATURAL GAS. THEREFORE, SUCH DRILLING RIGS, GEN UINENESS-SETS ETC. ARE NOT TRANSFERRED FOR THE PRODUCTION OF OIL AND NATURAL G AS FROM THE UNDERTAKING BUT SUCH DRILLING RIGS, GENUINENESS-SETS ETC. AS SOON A S THE EXPLORATION IS COMPLETED, ARE TRANSFERRED FOR USE IN EXPLORATION O F SOME OTHER OIL WELLS IN SOME OTHER AREA. ONCE THE SUCCESSFUL WELL IS CONSTR UCTED, WITH NEW PLANT AND MACHINERY, THE OIL WELL COMMENCES AS AN UNDERTAKING FOR PRODUCING THE OIL. THEREFORE, THERE IS NO TRANSFER OF ANY PLANT OR MAC HINERY TO THE UNDERTAKING FOR ITS USE. (D) REGARDING THE POINT OF NON-SUBMISSION OF AUDIT REPORT ALONGWITH THE RETURN OF INCOME, THE AR ARGUED THAT SUBMISSION OF DOCUMENTS IN SUPPORT OF THE CLAIM OF THE ASSESSEE, HAS BEEN DECIDED BY VARIOUS COURT S AND THAT THE SUBMISSION OF THE REQUIRED DOCUMENTS DURING THE COURSE OF HEAR ING IS SUFFICIENT COMPLIANCE OF THE REQUIREMENT OF A PARTICULAR SECTI ON OR PARTICULAR CLAIM, IF THE SAME IS COMPLIED WITH BEFORE THE COMPLETION OF THE ASSESSMENT. THE AR DREW MY ATTENTION TO THE NOTING OF THE ASSESSING OFFICER IT IS TRUE THAT THE AS HAS SUBMITTED THE REPORT IN FORM 10CCB IN RESPECT O F 59 WELLS AND ARE STATED TO BE SEPARATE NEW UNDERTAKINGS . THE AR, ACCORDINGLY, REFUTED THE ALLEGATION OF THE AO THAT THE AUDIT REPORT HAD NOT BEEN SUBMITTED. THE AR ALSO SUBMITTED THAT IN C ASE A CONSOLIDATED REPORT, INSTEAD OF INDIVIDUAL REPORT IS SUBMITTED, IT SHOUL D NOT BE TREATED AS A NON- COMPLIANCE OF THE PROVISIONS OF THE ACT. THE AR ALSO SUBMITTED THAT SECTION 80IB/80IC GAVE C ERTAIN TAX RELIEF IN CERTAIN CIRCUMSTANCES AND THEREFORE SUCH A PROVISIO N IS TO BE LIBERALLY CONSTRUED. (239 ITR 775 (SC) FOR THE REASONS AFORESAID IT WAS SUBMITTED BY THE A R THAT THE BENEFIT UNDER SECTION 80IB FOR THE ASSESSMENT YEARS 2003-04 AND 2 004-05 AND BENEFIT U/S. 80IC FOR THE ASSESSMENTS YEARS 2005-06 AND 2006-07 ARE TO BE ALLOWED . 5. LEARNED SENIOR STANDING COUNSEL SEEKS US TO TREA T THE REVENUES APPEAL ITA NO.120/GAU/2008 FOR ASSESSMENT YEAR 2003 -04 AS THE LEAD CASE RAISING THE FOLLOWING SUBSTANTIVE GROUNDS:- ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 7 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAD ERRED ON FACTS AND LAW BY ALLOWING DEDUCTION U/S. 80IB THROU GH A NON SPEAKING ORDER, WITHOUT DISCHARGING AND REBUTTING THE AOS FINDING ON FACTS AND LAW AND WITHOUT REFERRING TO THE LIMITATIONS AS PROVIDED U/ S. 80IB(3)(I), 80IB(4) 3 RD PROVISO OF THE I.T ACT AND 80IB(9). 6. OUR ATTENTION IS NEXT INVITED TO REVENUES APPLI CATION FILED WAY-BACK ON 29.03.2017 SEEKING TO RAISE ITS TWIN FOLDED ADDITIO NAL GROUNDS THAT THE CIT(A) HAS FURTHER ERRED IN HOLDING THE ASSESSEE IS ELIGIB LE FOR U/S 80IB DEDUCTION DESPITE ITS FAILURE IN FILING THE AUDITORS REPORT IN THE PRESCRIBED FORM 10CCB OF THE IT RULES AND ALSO FOR NOT HAVING RAISED THE SAI D RELIEF CLAIM IN THE RETURN OF INCOME. HON'BLE APEX COURTS LANDMARK JUDGMENT IN NATIONAL THERMAL POWER CORPORATION LTD. VS. CIT (1998) 29 ITR 383 (SC) CONSIDERED IN THE TRIBUNAL S SPECIAL BENCH IN THE M/S ALL CARGO GLOBAL LOGISTICS LTD. VS. DCIT (2012) 137 ITD 26 (MUM) HOLDS THAT WE CAN VERY WELL ENTERTAIN SUCH A LEGAL QUESTION TO DETERMINE CORRECT TAX LIABILITY OF AN ASSESSEE WHEN ALL THE RELEVANT FACTS FORM PART OF RECORDS. WE GO BY THE VERY ANALOGY TO ADMIT THE REVENUES FOREGOING TWIN ADDITIONAL GROUNDS. 7. WE NOW ADVERT TO THE REVENUES ARGUMENTS. LEARNE D SENIOR STANDING COUNSEL FILES ASSESSEES COMPUTATION OF TAXABLE INC OME FOR ASSESSMENT YEAR 2003-04 CONTAINING A NOTE AT THE BOTTOM TO THE FACT THAT ITS FIFTEEN NEW WELLS HAD STARTED CRUDE OIL PRODUCTION DURING THE CORRESP ONDING FINANCIAL YEAR AND THEREFORE, IT IS ENTITLED SEC. 80IB 100% DEDUCTION QUA PROFITS DERIVED THEREFROM. THE SAME ALSO ACCOMPANIES A DETAILED COM PUTATION FURNISHED IN SCHEDULE-5. MR. SARMA ACCORDINGLY PLEADS THAT ASSES SEES DEDUCTION CLAIM RELATES TO FIFTEEN NEW WELLS IN THE RELEVANT PREVIO US YEAR. AND ALSO THAT TWENTY- EIGHT SUCH WELLS HAD BEEN COMPLETED IN THE LAST FIV E YEARS TAKING TOTAL COUNT TO FORTY-THREE. THE IMPUGNED ASSESSMENT YEAR IS ADMITT EDLY THE FIRST YEAR OF ASSESSEE HAVING CLAIMED THE DEDUCTION IN ISSUE. 8. THE ASSESSEES PRESENT INCUMBENT ASSESSING OFFIC ER MS. SHERPA SUBMITS THAT THE OIL WELLS ARE NOT IN THE NATURE OF NEW UNDERTAKING SO AS TO ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 8 BE ELIGIBLE FOR SEC. 80IB DEDUCTION. SHE CITES HON' BLE CALCUTTA HIGH COURTS DECISION IN CIT VS. OIL INDIA LTD. (1992) 198 ITR 3 70 (CAL) IN THE TAXPAYERS CASE ITSELF FOR ASSESSMENT YEAR 1992-73. SHE TAKES US TO PARA 12 & 13 THEREIN. THE TRIBUNALS FINDINGS HAD HELD THE ASSES SEES OIL WELLS TO BE PLANT FOR THE PURPOSE OF SEC. 32(2A) DEVELOPMENT REBATE. IT HAD STATED THEREIN THAT AN OIL WELL IS AN APPARATUS USE FOR THE PURPOSE OF DERIVING INCOME FROM CRUDE OIL AFTER DRILLING AND THEREFORE THE SAME IS IN THE NATURE OF PLANT OF CARRYING OUT OIL EXPLORATION AS BUSINESS ACTIVITY. MS. SHARPA AC CORDINGLY CONTENDS THAT SINCE THEIR LORDSHIP HAD TREATED ALL OIL WELLS AS A PLANT IN COMPOSITE MANNER, THE ASSESSEES STAND THAT EACH WELL FORMS AN ELIGIB LE UNDERTAKING NOW GOES CONTRARY TO THE SAID SETTLED PROPOSITION. 9. THE REVENUES NEXT ARGUMENT QUOTES RULE 18BBB(2) OF THE INCOME-TAX RULES THAT THE ASSESSING OFFICER HAD RIGHTLY HELD T HE ASSESSEE HAVING VIOLATED THE MANDATORY CONDITION OF FILING A SEPARATE REPORT FOR THE PURPOSE OF SEC. 80IB DEDUCTION AS A MANDATORY CONDITION FOR FURNISHING A SEPARATE AUDIT REPORT ALONGWITH THE RELEVANT PROFIT AND LOSS ACCOUNT AS W ELL AS BALANCE-SHEET AS IF THE UNDERTAKING IS AN DISTINCT ENTITY FOR THE PURPO SE OF CLAIMING U/S 80IB DEDUCTION. IT ALSO EMPHASISES THAT THE IMPUGNED STA TUTORY PROVISION TREATS EACH UNDERTAKING AS A SEPARATE ONE ON STANDALONE BA SIS INCLUDING CAPITAL EMPLOYED, PROFITS DERIVED TO BE RECORDED IN SEPARAT E BOOKS OF ACCOUNT. HON'BLE JURISDICTIONAL HIGH COURTS DECISION CIT VS. TECHNOTIVE EASTERN PVT. LTD. (2002) 225 ITR 253 (GAU) IS SOUGHT TO BE DISTINGUI SHED ON THE GROUND THAT THE SAME INVOLVED SEC. 80HH AND 80I CLAIM(S) A GAINST THE ONE U/S 80IB RAISED BEFORE US. 10. THE REVENUES NEXT ARGUMENTS ARE THAT THE ASSES SEES PLANT AND MACHINERY IN ITS OIL WELLS HAD BEEN PREVIOUSLY USED FOR OTHER PURPOSES AND THEREFORE, THE ASSESSING OFFICER HAD RIGHTLY DENIED THE IMPUGNED SEC. 80IB DEDUCTION. AND ALSO THAT THE ASSESSEE HAD NEITHER F ILED ITS FORM 10CCB AUDITORS REPORT ALONGWITH RETURN OF INCOME NOR DUR ING SCRUTINY PROCEEDINGS. ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 9 11. MR. MAHANTA, PRINCIPAL COMMISSIONER OF INCOME-T AX, DIBRUGARH HAS ALSO RENDERED HIS VALUABLE ASSISTANCE TO THE BENCH. HE Q UOTED SEC. 80IB(9)(II) OF THE ACT THAT THE ASSESSEES DEDUCTION CLAIM HAS TO BE CONSIDERED FOR A PERIOD OF SEVEN CONSECUTIVE ASSESSMENT YEARS; INCLUDING TH E INITIAL ASSESSMENT YEAR, IF IT ELIGIBLE UNDERTAKINGS ARE LOCATED IN NORTH EA STERN REGION BEGINNING OR HAVING BEGUN THE COMMERCIAL PRODUCTION OF MINERAL O IL ON OR BEFORE 01.04.1997 AND THEREAFTER; RESPECTIVELY. HE HIGHLIG HTS THE FACT THAT THE ASSESSEES PROFITS DERIVED FROM FIFTEEN OF THE SAID OIL WELLS QUALIFY FOR U/S 80IB DEDUCTION FOR SEVEN CONSECUTIVE ASSESSMENT YEARS SI NCE THE REMAINING TWENTY-EIGHT (SUPRA) HAD COMMENCED PRODUCTION BEFOR E 01.04.1997 AND THEREFORE, THE IMPUGNED LEAD ASSESSMENT YEAR 2003-04 IS VERY WELL BEYOND THE STATUTORY TIME SPAN OF SEVEN CONSECUTIVE ASSESS MENT YEARS. MR. MAHANTA ACCORDINGLY URGES US TO RESTORE THE INSTANT ISSUE B ACK TO THE ASSESSING OFFICER FOR NECESSARY FACTUAL VERIFICATION. 12. THE ASSESSEE PLACES STRONG RELIANCE UPON THE CI T(A)S FINDINGS DELETING THE IMPUGNED SEC. 80IB DEDUCTION DISALLOWANCE. MR. JAIN TOOK US TO PAGE 214 IN THE ASSESSEES PAPER BOOK COMPRISING OF ITS FORM 10CCB AUDIT REPORT (REVISED) MAKING IT CLEAR THAT IT HAD IN FACT RAISE D SEC. 80IB(4) DEDUCTION CLAIM THAN SEC. 80IB(A) (SUPRA) OF THE ACT. PAGE 219 (INT ERNAL PAGE 6) THEREAFTER ALSO CONTAINS THE ASSESSEES SPECIFIC RESPONSE TO CLAUSE 2 B TO THIS EFFECT. 13. MR. JAIN QUOTES SEC. 80IB(4) 1 ST TO 3 RD PROVISO READ WITH THE EIGHTH SCHEDULE INCLUDING ASSAM STATE AT # 2 IN THE SPECIF IED STATES LEST TO THE EFFECT. RELEVANT PERIOD FOR 100% DEDUCTION OF THE PROFITS D ERIVED FROM THE ELIGIBLE UNDERTAKING THEREIN IS TEN ASSESSMENT YEAR(S). HE S TATES THAT THE ASSESSEE HAD STARTED ITS COMMERCIAL PRODUCTION BETWEEN 01.04 .1993 TO 31.03.2004 IN RESPECT OF ALL FORTY-THREE OIL WELLS AS PER THE ABO VE STATED PROVISO(ES) TO SEC. 80IB(4) OF THE ACT. CASE LAW ACIT VS. NIKO RESOURCES LTD. (2009) 123 TTJ 310 (AHD), NIKO RESOURCES LTD. VS. UNION OF INDIA (2015) 374 ITR 369 (GUJ); COMMISSIONER OF INCOME-TAX, GUWAHATI VS. BONGAIGAON REFINERY AND ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 10 PETROCHEMICAL LTD. (2012) 349 ITR 352 (SC); COMMISSIONER OF INCOME-TA X VS. TECHNOTIVE EASTERN (P) LTD. (202) 1224 TAXMAN 769 ( GAU); COMMISSIONER OF INCOME-TAX, PANCHKULA VS. MICRO INSTRUMENTS CO. (20 16) 388 ITR 46 (P&H); COMMISSIONER OF INCOME-TAX VS. DUNLOP RUBBER CO. (I I) LTD., (1977) 107 ITR 182 (CAL); RANBAXY LABORATORIES LTD. VS. ASSISTANT COMMISSIONER OF INCOME- TAX, RAANGE-15, NEW DELHI (2016) 68 TAXMANN.COM 322 (DEL); COMMISSIONER OF INCOME-TAX VS. G.M.KNITTING INDUSTRIES (P) LTD. (2015) 376 ITR 456 (SC); COMMISSIONER OF INCOME-TAX, DELHI VS. CONTIMETERS E LECTRICALS (P) LTD. (2009) 317 ITR 249 (DEL); COMMISSIONER OF INCOME-TAX VS. A XIS COMPUTERS (INDIA) (P) LTD. (2009) 178 TAXMAN 143 (DEL); COMMISSIONER OF INCOME-TAX-I VS. AKS ALLOYS (P) LTD. (2012) 18 TAXMANN.COM 25 (MAD); COM MISSIONER OF INCOME-TAX VS. GUJARAT OIL & ALLIED INDUSTRIES (1993) 201 ITR 325 (GUJ) AND BAJAJ TEMPO LTD. VS. COMMISSIONER OF INCOME-TAX (1992) 196 ITR 188 (SC); ARB INDUSTRIES VS. JCIT SPECIAL RANGE-14 (2005) 93 TTJ 608 (DEL) NOTIFICATION NO.S.O. 627(E) [NO.11022(F.NO.142/32/99-TPL)]SECTIO N 80-IB DATED 04.08.1999 AND OIL & NATURAL GAS CORPORATION LTD. V S. COMMISSIONER OF INCOME-TAX (2015) 376 ITR 306 (SC) IS ALSO QUOTED I N SUPPORT. 14. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO F ORGOING ARGUMENTS QUA THE INSTANT LEAD ISSUE OF ASSESSEES DEDUCTION CLAIM U/S 80IB OF T HE ACT. WE ADVERT TO THE ASSESSING OFFICERS FOUR FOLDED REASO NING (SUPRA) THAT THE ASSESSEE WAS SUPPOSED TO FURNISH A SEPARATE AUDIT R EPORT AS PRESCRIBED UNDER IT RULES IN CASE OF AN ELIGIBLE UNDERTAKING O R ENTERPRISE CLAIMING SEC. 80IB DEDUCTION TO BE FURTHER ACCOMPANIED BY THE REL EVANT PROFIT AND LOSS ACCOUNT / BALANCE-SHEET AS IF THE UNDERTAKING IS A DISTINCT ENTITY. THE CIT(A) QUOTES HON'BLE JURISDICTIONAL HIGH COURTS DECISION BONGAIGAON REFINERY & PETROCHEMICALS LTD. (SUPRA) THAT THE LAW DOES NOT R EQUIRE SUCH SEPARATE ACCOUNTS TO BE MAINTAINED AS IF THE UNDERTAKING ITS ELF IS A DISTINCT BUSINESS. THE REVENUE HAS ADMITTEDLY SOUGHT TO DISTINGUISH TH E SAME FOR THE REASON THAT THEIR LORDSHIPS DEALT WITH A CASE OF SEC. 80HH AND SEC. 80I DEDUCTION AS AGAINST THAT RAISED U/S. 80IB BEFORE US. WE FIND NO MERIT IN THE REVENUES ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 11 INSTANT ARGUMENTS. SECTION 80IB(13) IMPORTS SEC. 80 IA(5) AND (7) TO (12) TO BE APPLICABLE TO THE ELIGIBLE BUSINESS CARRIED OUT BY THE ELIGIBLE UNDERTAKING INI QUESTION. WE NOTICE IN THIS BACKDROP THAT THE CLINC HING LEGISLATIVES EXPRESSION 80IA(7) IS ACCOUNTS OF THE UNDERTAKING THAN A COMPLETE SET OFF SEPARATE BOOKS OF ACCOUNT. AND SEC. 80HH(5), 80I(7), SEC. 80 IA(7) AS WELL AS SEC. 80IB(13) ALSO USE THE VERY STATUTORY EXPRESSION ACCOUNTS OF THE UNDERTAKING . WE HOLD IN THIS BACKDROP THAT THE CIT(A) HAS RIG HTLY FOLLOWED THE HON'BLE JURISDICTIONAL HIGH COURTS DECISION IN TAXPAYERS FAVOUR. VARIOUS OTHER JUDICIAL PRECEDENTS BONGAIGAON REFINERY & PETROCHEMICALS LTD. , MICRO INSTRUMENTS CO. & RANBAXY LABORATORIES LTD. (SUPRA) ALSO SUPPORT THE ASSESSEES CASE. WE MAKE IT CLEAR THAT THE REVENUE S PAPER BOOK TO THIS EFFECT DOES NOT PIN-POINT ANY MATERIAL THAT THE ASS ESSEE HAD NOT MAINTAINED ITS BOOKS OF ACCOUNT AS PER ITS EACH OIL WELL-WISE TREA TED AS A SEPARATE UNDERTAKING. SAME IS THE FATE OF THE REVENUES NEXT ARGUMENT THAT ASSESSEES EACH OIL WELL OUGHT NOT TO BE TREATED AS A SEPARATE ELIGIBLE UNDERTAKING. HON'BLE GUJARAT HIGH COURTS AND THIS TRIBUNAL DECI SION IN NICCO LABORATORIES LTD. (SUPRA) DECIDED THE VERY ISSUE IN ASSESSEES F AVOUR THAT EACH OIL WELL CAN INDEED BE TREATED AS A SEPARATE ELIGIBLE UNDERTAKIN G. PAGE 291 IN ASSESSEES PAPER BOOK REVEALS THAT THE CIT(A) HAD DEPUTED THE ASSESSING OFFICER HIMSELF TO VERIFY THE CORRECT FACTUAL POSITION. THE ASSESSI NG OFFICER VISITED THE ASSESSSEES OIL WELLS SITE. HE REPORTED ON 03.03.20 10 THAT THE ASSESSEES OIL WELLS ARE DISTINGUISHINGLY IDENTIFIABLE AS PER THEI R RESPECTIVE PRODUCTION. AND ALSO THAT IT HAD MAINTAINED PRODUCTION-WISE AND DRI LLING COST; WELL-WISE, IN SEPARATE BOOKS OF ACCOUNT IN COMPUTERS. WE THEREFOR E DECLINE THE REVENUES TWIN FOREGOING ARGUMENTS. ITS RELIANCE ON HON'BLE C ALCUTTA HIGH COURTS JUDGMENT IN ASSESSEES CASE (SUPRA) TREATING THE OI L WELLS AS A COMPOSITE PLANT FOR SEC. 32(2A) INVESTMENT ALLOWANCE DEDUCTIO N DOES NOT APPLY SO FAR AS SEC. 80IB DEDUCTION CLAIM IS CONCERNED. WE MAKE IT CLEAR THAT THE SAID RELIEF WAS APPLICABLE FOR THE PURPOSE OF GIVING STIMULUS T O INVESTMENT WHEREAS THE INSTANT ISSUE IS THAT OF ELIGIBLE UNDERTAKING-WISE DEDUCTION AS ALREADY PROVED IN FOREGOING DISCUSSION. ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 12 15. THE REVENUES NEXT ARGUMENT IS THAT THE ASSESSE E HAD USED ITS MACHINES OR PLANT FOR OTHER PURPOSES AS PER PAGE-6 OF THE ASSESSMENT ORDER DATED 30.11.2005 ALSO DOES NOT CARRY MERIT. WE NOTI CE FIRST OF ALL THAT THE ASSESSING OFFICER HAD NOWHERE INDICATED AS TO WHAT KIND OF PLANT AND MACHINERY HAD BEEN USED FOR OTHER PURPOSES. BE THAT AS IT MAY, HON'BLE APEX COURTS JUDGMENT IN BAJAJ TEMPO LTD. (SUPRA) HELD LONG BACK THAT THE LEGISLATIVE EXPRESSION FORM ALONGWITH A PRE-FIX NEGATIVE COVENANT HAS TO BE I NTERPRETED IN THE FOLLOWING MANNER:- FORM ACCORDING TO THE DICTIONARY, HAS DIFFERENT MEANIN GS. IN THE CONTEXT IN WHICH IT HAS BEEN USED IT WAS INTENDED TO CONNOTE T HAT THE BODY OF THE COMPANY OR ITS SHAPE DID NOT COME UP IN CONSEQUENCE OF TRANSFER OF BUILDING, MACHINERY OR PLANT USED PREVIOUSLY FOR BU SINESS PURPOSES. USE OF THE NEGATIVE BEFORE THE WORD FORMED FURTHE R STRENGTHENS IT. IN OTHER WORDS, BUILDING, MACHINERY OR PLANT USED PREV IOUSLY IN OTHER BUSINESS SHOULD NOT RESULT IN THE UNDERTAKING BEING FORMED BY IT. THE TRANSFER TO TAKE OUT THE NEW UNDERTAKING OUT OF THE PURVIEW OF SUB- SECTION (1) MUST BE SUCH THAT BUT FOR THE TRANSFER THE NEW UNDERTAKING COULD NOT HAVE COME INTO BEING . IN OUR OPINION, ON THE FACTS FOUND BY THE TRIBUNAL, THE PART PLAYED BY TAKING THE BUILDING ON LEASE WAS NOT DOMINANT IN THE FORMATION OF THE COMPANY. THE HIGH COURT WAS TH EREFORE NOT JUSTIFIED IN ANSWERING THE QUESTION IN FAVOUR OF THE REVENUE. 16. LEARNED SENIOR STANDING COUNSEL FAILS TO DISPUT E THAT SEC. 80IB(2) ALSO CARRIES A SIMILAR EXPRESSION ANY INDUSTRIAL UNDERTAKING... NOT FORMED BY . WE CONCLUDE IN THESE FACTS THAT THE ASSESSEES OIL WELLS HAD COME INTO EXISTENCE AFTER EARTH DIGGING THROUGH RIGS. THERE I S THUS NO VIOLATION OF THE LEGISLATIVE CONDITION OF USE OF OLD MACHINERY FOR F ORMATION OF THE UNDERTAKING / OIL WELLS. THE ASSESSEE IS THEREFORE HELD TO HAVE U SED ITS OIL RIGS, EQUIPMENTS AND TOOLS FOR BRINGING INTO EXISTENCE THE NEW OIL W ELL / ELIGIBLE UNDERTAKING THAN HAVING FORMED THE SAME THROUGH THE OLD PLANT AND MA CHINERY. 17. THE REVENUES NEXT ARGUMENT THAT THE ASSESSEE H AD NOT FILED ITS FORM- 10CCB AUDIT REPORT ALONGWITH RETURN OR DURING ASSES SMENT FAILS TO INVOKE OUR CONCURRENCE SINCE THE ASSESSING OFFICER HAD HIMSELF NOTED THAT THE SAID REPORT ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 13 STOOD DULY SUBMITTED AS PER THE CIT(A)S DETAILED D ISCUSSION (SUPRA). THE SAME TAKES CARE OF THE DEPARTMENTS INSTANT GRIEVAN CE. 18. THE REVENUES NEXT ARGUMENT SEEKS TO TREAT THE ASSESSEES IMPUGNED DEDUCTION CLAIM U/S 80IB(9) HAD NOT SEC.80IB(4) OF THE ACT. THE ABOVE FORMER PROVISION GRANTS DEDUCTION FOR SEVEN CONSECUTIVE AS SESSMENT YEARS IN CASE OF AN UNDERTAKING LOCATED IN NORTH EASTERN REGION COMM ENCING ITS COMMERCIAL PRODUCTION AS PER THE DUE DATES PRESCRIBED. WE WISH TO REITERATE HERE AS PER PAGE 214 IN THE PAPER BOOK THAT THE ASSESSEES FORM 10CCB HAD SPECIFICALLY RAISED SEC. 80IB(4) DEDUCTION CLAIM FOR TEN ASSESSM ENT YEARS. PAGES 226 IS THE VERY FORM-10CCB REPORT FOR ASSESSMENT YEAR 2004 -05 IN IDENTICAL MANNER. WE THEREFORE REJECT THE REVENUES INSTANT G RIEVANCE WHICH TURNS OUT TO BE AGAINST THE FACTS ON RECORD. WE MAKE IT CLEAR THAT FORM 10CCB IS A SPECIFIC DOCUMENT PRESCRIBED FOR CLAIMING THE IMPUG NED DEDUCTION. THE REVENUES ABOVE STATED ARGUMENTS THAT THE ASSESSEE HAD NOT EXPRESSLY MADE IT CLEAR IN ITS COMPUTATION ABOUT THE IMPUGNED DEDUCTION CLAIM RAISED U/S. 80IB(4) OF THE ACT IS DECLINED. 19. LEARNED STANDING COUNSEL SUBMITTED AT THIS STAG E THAT OUR FOREGOING DETAILED DISCUSSION HOLDING THE ASSESSEES ELIGIBLE FOR CLAIMING SEC. 80IB DEDUCTION IS APPLICABLE ONLY IN ASSESSMENT YEARS 20 03-04 AND 2004-05 INVOLVING APPEAL(S) ITA NO.120 AND 121/GAU/2008. WE THEREFORE REJECT REVENUES INSTANT FORMER TWO APPEALS. 20. THE REVENUES CASE AT THIS STAGE IS THAT THE AS SESSING OFFICER HAD RIGHTLY DECLINED THE ASSESSEES DEDUCTION CLAIM U/S . 80IC OF THE ACT. LEARNED PRINCIPAL CIT INVITED OUR ATTENTION TO THE FACT THA T SEC. 80IC OF THE ACT ENVISAGED THE CORRESPONDING DEDUCTION RELIEF IN CAS E OF NORTH EASTERN STATES UNDER SUB-SECTION 2(B)(III). AND THAT THE SAME APPL IES TO MANUFACTURE OR PRODUCTION OF ANY ARTICLE OR THING SPECIFIED IN 14 TH SCHEDULE AS PER THE FINANCE ACT, 2003 WITH EFFECT FROM 01.04.2004. ITEM NO.16 I N 14 TH SCHEDULE ADMITTEDLY ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 14 INCLUDES MINERAL BASED INDUSTRY IN THE POSITIVE LIST OF ARTICLES OR THINGS TO BE MANUFACTURED OR PRODUCED. MR. MAHANTAS CASE ACCORD INGLY IS THAT THE ASSESSEES ACTIVITY OF CRUDE OIL EXPLORATION THROUG H ITS OIL WELLS DOES NOT AMOUNT TO A MINERAL BASED INDUSTRY. HE ALSO PLACES RELIANCE ON HON'BLE APEX COURTS DECISION IN ONGC (SUPRA) AS UNDER:- 13. THE INCOME TAX ACT DOES NOT DEFINE THE EXPRESSI ONS MINES OR MINERALS . THE SAID EXPRESSIONS ARE FOUND DEFINED AND EXPLAINED IN THE MINES ACT, 1952 AND THE OIL FIELDS (DEVELOPMENT AND REGULATION) ACT 1948. WHILE CONSTRUING THE SOMEWHAT PARI MATERIAL EXPRESSIONS APPEARING IN THE MINES AND MIN ERALS (DEVELOPMENT AND REGULATION) ACT 1957 REGARD MUST BE HAD TO THE PROV ISIONS OF ENTRIES 53 AND 54 OF LIST I AND ENTRY 22 OF LIST II OF THE 7 TH SCHEDULE TO THE CONSTITUTION TO UNDERSTAND THE EXCLUSION OF MINERAL OILS FROM THE DEFINITION OF MI NERALS IN SECTION 3(A) OF THE 1957 ACT. REGARD MUST ALSO BE HAD TO THE FACT THAT MINER AL OILS IS SEPARATELY DEFINED IN SECTION 3((B) OF THE 1957 ACT TO INCLUDE NATURAL GA S AND PETROLEUM IN RESPECT OF WHICH PARLIAMENT HAS EXCLUSIVE JURISDICTION UNDER ENTRY 5 3 OF LIST I OF THE 7 TH SCHEDULE AND HAD ENACTED AN EARLIER LEGISLATION I.E. OIL FIELDS (REGULATION AND DEVELOPMENT) ACT, 1948. READING SECTION 2(J) AND 2(JJ) OF THE MINES A CT, 1952 WHICH DEFINE MINES AND MINERALS AND THE PROVISIONS OF THE OIL FIELDS (REGU LATION AND DEVELOPMENT) ACT, 1948 SPECIFICALLY RELATING TO PROSPECTING AND EXPLORATIO N OF MINERAL OILS, EXHAUSTIVELY REFERRED TO EARLIER, IT IS ABUNDANTLY CLEAR THAT DR ILLING OPERATIONS FOR THE PURPOSE OF PRODUCTION OF PETROLEUM WOULD CLEARLY AMOUNT TO A M INING ACTIVITY OR A MINING OPERATION. VIEWED THUS, IT IS THE PROXIMITY OF THE WORKS CONTEMPLATED UNDER AN AGREEMENT, EXECUTED WITH A NON-RESIDENT ASSESSEE OR A FOREIGN COMPANY IS TO BE ASSESSED UNDER SECTION 44BB OR SECTION 44D OF THE A CT. THE TEST OF PITH AND SUBSTANCE OF THE AGREEMENT COMMENDS TO US AS REASON ABLE FOR ACCEPTANCE. EQUALLY IMPORTANT IS THE FACT THAT THE CBDT HAD ACCEPTED TH E SAID TEST AND HAD IN FACT ISSUED A CIRCULAR AS FAR BACK AS 22.10.1990 TO THE EFFECT THAT MINING OPERATIONS AND THE EXPRESSIONS MINING PROJECTS OR LIKE PROJECTS OCCURRING IN EXPLANATION 2 TO SECTION 9(1) OF THE ACT WOULD COVER RENDERING OF S ERVICE LIKE IMPARTING OF TRAINING AND CARRYING OUT DRILLING OPERATIONS FOR EXPLORATION OF AND EXTRACTION OF OIL AND NATURAL GAS AND HENCE PAYMENTS MADE UNDER SUCH AGREEMENT TO A N ON-RESIDENT/FOREIGN COMPANY WOULD BE CHARGEABLE TO TAX UNDER THE PROVIS IONS OF SECTION 44BB AND NOT SECTION 44D OF THE ACT. WE DO NOT SEE HOW ANY OTHER VIEW CAN BE TAKEN IF THE WORKS OR SERVICES MENTIONED UNDER A PARTICULAR AGREEMENT IS DIRECTLY ASSOCIATED OR INEXTRICABLY CONNECTED WITH PROSPECTING, EXTRACTION OR PRODUCTION OF MINERAL OIL. KEEPING IN MIND THE ABOVE PROVISION, WE HAVE LOOKED INTO EACH OF THE CONTRACTS INVOLVED IN THE PRESENT GROUP OF CASES AND FIND THA T THE BRIEF DESCRIPTION OF THE WORKS COVERED UNDER EACH OF THE SAID CONTRACTS AS CULLED OUT BY THE APPELLANTS AND PLACED BEFORE THE COURT IS CORRECT. THE SAID DETAILS ARE S ET OUT BELOW: S.NO. CIVIL APPEAL NO. WORK COVERED UNDER THE CONTRACT 1 4321 WORK COVERED UNDER THE CONTRACT DRILLING OF EXPLORATION WELLS AND CARRYING OUT SEISMIC SURVEYS FOR EXPLORATORY DR ILLING. 2 740 DRILLING, FURNISHING PERSONNEL FOR MANNING, M AINTENANCE AND OPERATION OF DRILLING RIG AND TRAINING OF PERSONNEL . 3 731 DRILLING, FURNISHING PERSONNEL FOR MANNING, M AINTENANCE AND OPERATION OF DRILLING RIG AND TRAINING OF PERSONNEL . 4 1722 FURNISHING SUPERVISORY STAFF WITH EXPERTISE IN OPERATION AND MANAGEMENT OF DRILLING UNIT 5 729 CAPPING INCLUDING SUBDUING OF WELL, FIRE FIGH TING 6 738 CAPPING INCLUDING SUBDUING OF WELL, FIRE FIGH TING ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 15 7 1528 ANALYSIS OF DATA TO PREPARE JOB DESIGN, PROC EDURE FOR EXECUTION AND DETAILS READING MONITORING 8 1532 STUDY FOR SELECTION OF ENHANCED OIL RECOVERY PROCESSES AND CONCEPTUAL DESIGN OF PILOT TESTS 9 1520 ENGINEERING AND TECHNICAL SUPPORT OT ONGC IN IMPLEMENTATION OF CYCLIC STEAM STIMULATION IN HEAVY OIL WELLS. 10 2794 ASSESSMENT AND PROCESSING OF SEISMIC DATA A LONGWITH ENGINEERING AND TECHNICAL SUPPORT IN IMPLEMENTATION OF CYCLIC STEAM STIMULATION. 11 1524 CONDUCTING RESERVOIR STIMULATION STUDIES IN ASSOCIATION WITH PERSONNEL OF ONGC 12 1535 LABORATORY TESTING UNDER SIMULATED RESERVOI R CONDITIONS 13 1514 CONSULTANCY FOR OPTIMAL EXPLOITATION OF HYD ROCARBON RESOURCES 14 2797 CONSULTANCY FOR ALL ASPECTS OF COAL BED MET HANE 15 6174 ANALYSIS OF DATA OF WELLS TO PREPARE A JOB DESIGN. 16 1517 GEOLOGICAL STUDY OF THE AREA AND ANALYSIS O F SEISMIC INFORMATION REPORTS TO DESIGN 2 DIMENSIONAL SEISMIC SURVEYS. 17 7226 OPINION ON HYDROCARBON RESOURCES AND FORESE EABLE POTENTIAL 18 7227 OPINION ON HYDROCARBON RESOURCES AND FORESE EABLE POTENTIAL. 19 7230 OPINION ON HYDROCARBON RESOURCES AND FORESE EABLE POTENTIAL 20 6016 OPINION ON HYDROCARBON RESOURCES AND FORESE EABLE POTENTIAL. 21 6008 EVALUATION OF ULTIMATE RESOURCE POTENTIAL A ND PRESENTATIONS OUTSIDE INDIA IN CONNECTION WITH PROMOTIONAL ACTIVI TIES FOR JOINT VENTURE EXPLORATION PROGRAM. 22 1531 REVIEW OF SUB-SURFACE WELL DATA, PROVIDE RE PAIR PLAN OF WELLS AND SUPERVISE REPAIRS 23 733 REPAIR OF GAS TURBINE, GAS CONTROL SYSTEM AN D INSPECTION OF GAS TURBINE AND GENERATOR 24 741 REPAIR AND INSPECTION OF TURBINES 25 737 REPAIR, INSPECTION AND OVERHAULING OF TURBIN ES 26 736 INSPECTION ENGINE PERFORMANCE EVALUATION, IN STRUMENT CALIBRATION AND INSPECTION OF FAR 27 1522 REPLACEMENT OF CHOKE AND KILL CONSOLES ON DRILLING RIGS 28 1521 INSPECTION OF GAS GENERATORS 29 1515 INSPECTION OF RIGS 30 2012 INSPECTION OF GENERATOR 31 1240 INSPECTION OF EXISTING CONTROL SYSTEM AND DEPUTING ENGINEER TO ATTEND TO ANY PROBLEM ARISING IN THE MACHINES 32 1529 INSPECTION OF DRILLING RIG AND VERIFICATION OF RELIABILITY OF CONTROL SYSTEMS IN THE DRILLING RIG. 33 2008 EXPERT ADVICE ON THE DEVICE TO CLEAN INSIDE S OF A PIPELINE 34 2795 FEASIBILITY STUDY OF RIG TO ASSESS ITS REMA INING USEFUL LIFE AND TO CARRY OUT STRUCTURAL ALTERATIONS 35 925 ENGINEERING ANALYSIS OF RIG 36 1519 IMPARTING TRAINING ON CASED HOLD PRODUCTION LONG EVALUATION AND ANALYSIS 37 1533 TRAINING ON WELL CONTROL 38 1518 TRAINING ON IMPLEMENTATION OF SIX SIGMA CON CEPTS 39 1516 TRAINING ON IMPLEMENTATION OF SIX SIGMA CON CEPTS 40 6023 TRAINING ON DRILLING PROJECT MANAGEMENT 41 2796 TRAINING IN SAFETY RATING SYSTEM AND ASSIST ANCE IN DEVELOPMENT AND AUDIT OF SAFETY MANAGEMENT SYSTEM. 42 1239 TO DEVELOP TECHNICAL SPECIFICATION FOR 3D S EISMIC API MODULES OF WORK AND TO PREPARE BID PACKAGES 43 1527 SUPPLY SUPERVISION AND INSTALLATION OF SOFT WARE WHICH IS USED FOR ANALYSIS OF FLOW RATE OF MINERAL OIL TO DETERMINE R ESERVOIR CONDITIONS. 44 1523 SUPPLY, INSTALLATION AND FAMILIARIZATION O F SOFTWARE FOR ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 16 PROCESSING SEISMIC DATA THE ABOVE FACTS WOULD INDICATE THAT THE PITH AND SU BSTANCE OF EACH OF THE CONTRACT/AGREEMENTS IS INEXTRICABLY CONNECTED WITH PROSPECTING, EXTRACTION OR PRODUCTION OF MINERAL OIL. THE DOMINANT PURPOSE OF EACH OF SUCH AGREEMENT IS FOR PROSPECTING, EXTRACTION OR PRODUCTION OF MINERAL OI LS THOUGH THERE MAY BE CERTAIN ANCILLARY WORKS CONTEMPLATED THEREUNDER. IF THAT BE SO, WE WILL HAVE NO HESITATION IN HOLDING THAT THE PAYMENTS MADE BY ONGC AND RECEIVED BY THE NON-RESIDENT ASSESSEES OR FOREIGN COMPANIES UNDER THE SAID CONTR ACTS IS MORE APPROPRIATELY ASSESSABLE UNDER THE PROVISIONS OF SECTION 44BB AN D NOT SECTION 44D OF THE ACT. ON THE BASIS OF THE SAID CONCLUSION REACHED BY US, WE ALLOW THE APPEALS UNDER CONSIDERATION BY SETTING ASIDE THE ORDERS OF THE HI GH COURT PASSED IN EACH OF THE CASES BEFORE IT AND RESTORING THE VIEW TAKEN BY THE LEARNED APPELLATE COMMISSIONER AS AFFIRMED BY THE LEARNED TRIBUNAL. 21 THE REVENUE VEHEMENTLY CONTENDS IN LIGHT OF THEI R LORDSHIPS DISCUSSION THAT EVEN MINES AND MINERALS (DEVELOPMENT AND REGUL ATION) ACT, 1957 DOES NOT INCLUDE CRUDE OIL EXPLORATION IN THE DEFINITION OF MINERALS U/S 3 OF THE SAID LAW. WE SEE NO MERIT IN REVENUES INSTANT ARGUMENTS . WE QUOTE THE ABOVE EXTRACTED DECISION ITSELF WHEREIN THEIR LORDSHIP HA VE TREATED OIL EXPLORATION PAYMENTS MADE TO OVERSEAS NON-RESIDENT ENTITIES TO BE COVERED UNDER THE SPECIFIC PROVISION U/S 44BB AND NOT IN PRESUMPTIVE SCHEME OF TAXATION U/S 44AD OF THE ACT. WE MAKE IT CLEAR THAT THE ACT NOWH ERE DEFINES MINERALS OR MINERAL BASED INDUSTRY . THE SAME HAS THEREFORE TO BE TAKEN AS PER ITS MEANING IN ORDINARY PRUDENCE. HON'BLE APEX COURTS DECISION IN RAGHUNATH RAI BAREZA VS. PNB (2007) 135 COMPANIES CASES 163 ( SC) HOLDS THAT IT IS THE CARDINAL PRINCIPLE OF INTERPRETATION OF A STATUTE T HAT THE WORDS USED BY THE LEGISLATURE ARE TO BE UNDERSTOOD IN THEIR NATURAL, ORDINARY, AND POPULAR MEANING AND TO CONSTRUE AS PER THEIR GRAMMATICAL ME ANING UNLESS SUCH A CONSTRUCTION LEADS TO SOME ABSURDITY OR UNLESS THER E IS SOMETHING IN THE CONTEXT OR IN THE OBJECT OF THE STATUE TO SUGGESTS TO THE CONTRARY. THEIR LORDSHIPS ANOTHER JUDGMENT IN SMT. TARULATA SHYAM AND OTHERS VS. COMMISSIONER OF INCOME-TAX, WEST BENGAL (1977) 108 ITR 345 (SC) ALSO MADE IT CLEAR LONG BACK THAT IT IS THE FUNDAMENTAL RULE OF TAXATION THAT WHEN THERE IS NO SCOPE FOR IMPARTING INTO THE STATUE WOR DS WHICH ARE NOT USED, SUCH AN IMPORT WOULD NOT CONSTRUE BUT TO AMEND THE STATU TE. AND ALSO THAT IF THERE IS ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 17 ANY CAUSES OMICUS, THE DEFECT CAN BE REMEDIED BY L EGISLATION ALONE NOT BY JUDICIAL INTERPRETATION. 22. THEIR LORDSHIP RECENT CONSTITUTIONAL BENCHS DE CISION IN COMMISSIONER OF CUSTOMS VS. M/S DILIP KUMAR COMPANY & OTHERS CA NO. 3327 OF 2007 DATED 30.07.2018 HAS ALSO SETTLED THE LAW REGARDING AN EX EMPTION PROVISION THAT THE SAME HAS TO BE INTERPRETED STRICTLY. THE BURDEN OF PROVING ITS APPLICABILITY IS ON THE ASSESSEE TO SHOW THAT HIS CASE COMES WITHIN THE PARAMETERS OF THE EXEMPTION CLAUSE OR NOTIFICATION; AS THE CASE MAY B E. AND IN CASE OF AN AMBIGUITY IN EXEMPTION NOTIFICATION WHICH IS SUBJEC T-MATTER OF STRICT INTERPRETATION, THE BENEFIT THEREOF GOES TO THE REV ENUE AND NOT TO THE ASSESSEE. WE KEEP IN MIND THE FOREGOING LEGAL PROPO SITION TO REVERT BACK TO THE INSTANT ISSUE. THE ASSESSEE HAS ADMITTEDLY CLAI MED SEC.80IC(2)(B)(III) DEDUCTION IN ITS OIL WELLS HAVING STARTED CRUDE OIL PRODUCTION BETWEEN 20.12.1997 TO 01.04.2007. 23. WE FURTHER NOTICE AFTER A DEEPER SCRUTINY THAT THE ASSESSEES MAIN PRODUCE CRUDE OIL IS TREATED AS INTERCHANGEABLE T O MINERAL OIL INCLUDINIG NATURAL GAS AND PETROLEUM AS PER SEC. 3(C) OF THE O IL FIELDS (REGULATION AND DEVELOPMENT) ACT, 1948 (NO.53 OF 1948) OR THE OIL F IELDS (REGULATION AND DEVELOPMENT) AMENDMENT ACT 1969 (NO. 30 OF 1969). S ECTION 42 READ WITH ITS EXPLANATION, SECTION 44BB EXPLANATION (II) AND SECT ION 293A EXPLANATION (A) ALSO DEFINE MINERAL OIL AS HAVING THE VERY INCLUSIVE MEANING. WE OBSERVE IN THIS BACKDROP THAT THE ASSESSEE IS ENGAGED IN A MINERAL BASED INDUSTRY AS PER THE FOREGOING CLINCHING EXPRESSION EMPLOYED AS IN 14 TH SCHEDULE. 24. THE REVENUES CASE THAT THIS CRUDE OIL PRODUCTI ON DOES NOT AMOUNT TO MINERAL BASED INDUSTRY AS PER ITEM NO.16 IN 14 TH SCHEDULE OF THE ACT CARRIES NO SUBSTANCE SINCE THE ABOVE STATED EXPRESSION HAS TO BE CONSTRUED IN ORDINARY CONNOTATION WITHOUT HAVING REGARD THE FURT HER CLASSIFICATION OF MINERALS I.E. FERROUS OR NONFERROUS AND METALLIC OR NON-METALLIC ETC. ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 18 25. WE ALSO WISH TO MAKE IT CLEAR THAT THERE IS FUR THER NO DISPUTE ABOUT THE IMPUGNED STATUTORY PROVISION REQUIRING IN ASSESSEE TO MAINTAIN ITS BOOKS OF ACCOUNT QUA EACH UNDERTAKING TO BE TREATED AS SEPAR ATE UNIT IN SEC. 80IC(7) OF THE ACT INCORPORATING THE VERY LEGISLATIVE INTENT A S IS THERE IN SEC. 80IB(13) (SUPRA). 26. THE REVENUES LAST ARGUMENT IS THAT ASSESSEES OIL EXPLORATION ACTIVITY CANNOT BE TAKEN MANUFACTURE OR PRODUCTION AS PRES CRIBED IN SEC. 80IC(2)(B) OF THE ACT. HON'BLE APEX COURTS LANDMARK JUDGMENT IN CIT VS. N.C.BUDHARAJA AND CO. AND ANOTHER (1993) 204 ITR 412 (SC) HELD LONG BACK THAT THE STATUTORY EXPRESSION PRODUCE HAS WIDER CONNOTATION THAN THE WORD MANUFACTURE . THE FORMER; WHEN USED IN JUXTAPOSITION WITH THE LATTER, BRINGS INTO EXISTENCE NEW GOODS BY A PROCESS WHICH MAY OR MAY NOT AMOUNT TO MANUFACTURE. AND THAT THE SAME ALSO INCLUDES IN ALL THE BY PRODUCTS; INTERMEDIARY OR RESIDUARY HON'BLE DELHI HIGH COURT S DECISION IN HLS INDIA LTD . (SUPRA) ALSO HOLDS THAT WHETHER OR NOT ANY PARTICUL AR BUSINESS ACTIVITY AMOUNTS TO MANUFACTURE OR PRODUCTION FOR THE PURPOSE OF VAR IOUS INCENTIVES SCHEMES UNDER THE ACT IS REQUIRED TO BE EXAMINED IN THE LIG HT OF FACTS AND CIRCUMSTANCES IN EACH CASE. THESE CAN BE NO DENIAL OF THE FACT THAT CRUDE OIL CONTAINS HYDROCARBONS AS PARAFFIN, CYCLOPARAFFIN, N APTHENE AND ARAOMATIC COMPRCANDS WHICH IS OBTAINED FROM BENEATH THE EARTH S SURFACE. WE REITERATE THAT THIS ASSESSEE ADMITTEDLY DRILLS / EXPLORES CRU DE OIL FOR THE PURPOSE OF REFINING THE SAME TO VARIOUS BY-PRODUCTS. THIS WE T HUS CONCLUDE THAT ASSESSEES CRUDE OIL EXPLORATION VERY MUCH AMOUNTS TO PRODUCTION GOING BY THE RELEVANT FACTS IN THE LIGHT OF THE PRECEDING LE GAL POSITION. THE REVENUES INSTANT LAST ARGUMENT IS ALSO REJECTED. WE HOLD THA T CIT(A) HAS RIGHTLY GRANTED SEC. 80IC(2)(B) DEDUCTION TO THE TAXPAYER IN ASSESS MENT YEARS 2005-06 AND 2006-07. THE REVENUES TWO CORRESPONDING APPEAL(S) ITA NO.122 AND 123/GAU/2018 ALSO FAILS. 27. NEXT COMES THE ASSESSEES FOUR APPEAL(S) ITA NO .87/GAU/2010, 33/GAU/2018, 325/GAU/2013 & 09/GAU/2014 RELEVANT TO ASSESSMENT YEAR(S) 2007-08 TO 2010-11; RESPECTIVELY. LEARNED REPRESENT ATIVES INFORM US VERY ITA NO.120-123/G/2008 & 87/G/10, 33/G/18, 325/G/13 & 09/G/14 ACIT, CIR-2 DIB VS. OIL INDIA LTD. PAGE 19 FAIRLY THAT THE LOWER AUTHORITIES HAVE DECLINED TH E ASSESSEES SEC. 80IC(2)(B) DEDUCTION CLAIMS IN THESE FOUR YEARS. THE CIT(A) HA S IDENTICALLY HELD THAT IT OUGHT TO HAVE RAISED ITS CLAIM U/S. 80IB(9) OF THE ACT. THE ASSESSEE HAS PLEADED ITS IDENTICAL ADDITIONAL GROUND THEREFORE S EEKING TO CLAIM THE IMPUGNED DEDUCTION U/S80IB(9) OF THE ACT. WE CONCLU DE IN THIS FACTUAL BACKDROP THAT OUR FINDINGS HOLDING IT ELIGIBLE FOR SEC. 809IC DEDUCTION FOR ASSESSMENT YEARS 2005-06 AND 2006-07 WOULD APPLY MUTATIS MUTANDIS IN THESE FOUR LATTER ASSESSMENT YEAR(S) AS WELL. ITS A DDITIONAL GROUND IS THEREFORE RENDERED INFRUCTUOUS. BOTH THE LOWER AUTHORITIES AC TION DENYING REVENUES SEC. 80IC(2)(III) DEDUCTION INVOLVING VARYING SUM ( SUPRA) STANDS REVERSED. THE ASSESSEE SUCCEEDS IN ITS INSTANT FOUR APPEAL(S) IN ABOVE TERMS. 28. THESE FOUR REVENUES APPEAL(S) ITA NO.120-123/G AU/2008 ARE DISMISSED WHEREAS ASSESSEES APPEAL(S) ITA NO.87/GA U/2010, 33/GAU/2018, 325/GAU/2013 & 09/GAU/2014 ARE ALLOWED IN FOREGOING TERMS. ORDERED ACCORDINGLY. A COPY OF THIS ORDER BE PLACED IN THE RESPECTIVE CASE FILE(S). ORDER PRONOUNCED IN ACCORDANCE WITH RULE 34(3) OF T HE ITAT RULES BY PUTTING ON NOTICE BOARD 28/08/2019 SD/- SD/- ( ) (&' ) ( A.L.SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) GUWAHATI, *DKP (- 28 / 08 /201 9 / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-OIL INDIA LTD. P.O.DULIAJAN, DIST. DIBRUG ARH, ASSAM 2. /REVENUE-ACIT, RANGE-2, INCOME TAX OFFICE KARTIKPAR A, DIST. DIBRUGARH 3. 3 4 9 / CONCERNED CIT GUWAHATI 4. 4- / CIT (A) SHILLONG 5. < ''3, 3, 9 / DR, ITAT, GUWAHATI 6. B / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY (ON TOUR) 3,