DCIT,Circle-2, Kolkata, Kolkata V. M/s. Amricon Agrovet Pvt. Ltd., Howrah

ITA 1311/KOL/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 70458 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-12-2013
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2012
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Assessee Lawyers: D S DAMLE
• Keywords: Business income; Assessment record
• Section: 80IB; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH C , KOLKATA [BEFORE HONBLE SRI SHAMIM YAHYA, AM & HONBLE SR I GEORGE MATHAN, JM] ITA NO.1311/KOL/2012 ASSESSMENT YEAR : 2009-10 ( APPELLANT ) (RESPONDENT) D.C.I.T., CIRCLE-2, -VS- .M/S. AMRICON AGROVET P VT.LTD., KOLKATA HOWRAH (PAN AADCA 1610 Q) FOR THE APPELLANT: SHRI P.DAM KANUNJNA, JCIT, SR.DR FOR THE RESPONDENT: SHRI D.S.DAMLE, CA DATE OF HEARING : 17.12.2013 DATE OF PRONOUNCEMENT : 17. 12.2013. ORDER PER SHRI GEORGE MATHAN, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. C.I.T.(A)- I, KOLKATA IN APPEAL NO.666/CIT(A)-I/C-2/11-12 DATED 1 8.06.2012 FOR ASSESSMENT YEAR 2009-10.. 2. SHRI P.DAM KANUNJNA, JCIT,CIT(DR) REPRESENTED O N BEHALF OF THE REVENUE AND SHRI D.S.DAMLE, CA REPRESENTED ON BEHALF OF T HE ASSESSEE. 3. IN THIS APPEAL THE REVENUE HAS RAISED THE FOLLO WING GROUNDS :- 1. THAT ON FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD.CIT(A)-I ERRED IN DELETING THE DISALLOWANCE OF CLAIM OF ASSESSEE U/S 80IB WITHOUT CONSIDERING THE FACTS THAT NO NEW PRODUCT OF A DIFFERENT CHEMICAL COMPOSITION OR DIFF ERENT INTEGRAL STRUCTURE HAVING DISTINCTIVE OBJECTS IS PRODUCED FROM THE COMPONENT PRODUCTS. 2. THAT THE APPELLANT CRAVES LEAVE TO AMEND, MODI FY AND ALTER ANY GROUNDS OF APPEAL DURING COURSE OF HEARING OF THE CASE. 4. AT THE TIME OF HEARING IT WAS. FAIRLY AGREED BY BOTH THE SIDES THAT THE ISSUE IN THIS APPEAL BEING AGAINST DELETION OF DISALLOWANCE OF CLAIM OF ASSESSEE U/S 80IB OF THE ACT THE ISSUE WAS SQUARELY COVERED BY THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR A.YRS. 2007-08 AND 2008-09 IN ITA ITA NO.1311/KOL/2012 M/S.AMRICON AGROV ET PVT. LIMITED A.YR.2009-10 2 NO.2227/KOL/2010 DATED 20 TH MARCH, 2013 AND ITA NO.827/KOL/2012 DATED 13 TH AUGUST, 2013 RESPECTIVELY WHEREIN IN PARA 8 OF ORDE R OF THE COORDINATE BENCH OF THIS TRIBUNAL IN ITA NO.2227/KOL/2010 DATED 20 TH MARCH, 2012 THE COORDINATE BENCH OF THIS TRIBUNAL HAS HELD AS FOLLOWS :- 8. IN THE GROUND NO.4, THE ASSESSEE CLAIMED DEDUCT ION UNDER SECTION 80IB IN RESPECT OF INCOME DERIVED FROM THE UNDERTAKING AT HAJIPUR, DIS TRICT-VAISHALI, BIHAR FOR THE MANUFACTURE OF POULTRY FEED BEING CATEGORY-A INDUST RIALLY BACKWARD DISTRICT NOTIFIED BY THE CENTRAL GOVERNMENT. THE AO TOOK THE VIEW THAT T HE ASSESSEE COULD NOT BE CONSIDERED TO BE ENGAGED IN THE MANUFACTURE OF A PR ODUCT. WHEN THE MATTER WENT BEFORE THE CIT(A), THE CIT(A), RELYING ON THE DECISION OF THE ITAT, KOLKATA BENCH IN THE CASE OF THE ASSESSEES SISTER CONCERN AMRIT FEEDS LTD. AND AMRIT HATCHERIES PVT. LTD. TOOK THE VIEW THAT THE ASSESSEE WAS ENGAGED IN THE MANUFACTU RE OF A PRODUCTION OF AN ARTICLE AND ALLOWED THE DEDUCTION BY OBSERVING AS UNDER :- 7.2. I HAVE EXAMINED THE ASSESSMENT ORDER AND THE SUBMISSIONS OF THE A/R. I HAVE ALSO PERUSED THE NOTE ON PRODUCTION PROCESS, SCIENTIFIC LITERATURE ON CHEMICALS USED IN PRODUCTION OF POULTRY FEED AND COPIES OF THE ITATS ORDERS ON THE SUBJECT PASSED IN THE CASE OF AMRIT FEEDS LTD AND AMRIT HATCHERIES PVT. L TD.. IT APPEARED FROM THE ASSESSMENT ORDER THAT THE AO DISALLOWED DEDUCTION U /S 80IB, BY PLACING RELIANCE ON THE DECISIONS OF THE SUPREME COURT IN CASE OF SACS EAGL ES CHICORY VS CIT, COLLECTOR OF CENTRAL EXCISE VS KUTTY FLUSH DOORS AND FURNITURE C O.(P)LTD AND INDIA HOTELS CO.LTD. VS ITO (SUPRA). THESE VERY DECISIONS WERE ALSO RELI ED UPON BY THE ASSESSING OFFICERS EARLIER WHEN THE DEDUCTION U/S 801B(5) WAS REJECTED IN THE HANDS OF AMRIT FEEDS LTD AND AMRIT HATCHERIES PVT. LTD. IN THE COURSE OF APP EAL THE CIT (A) THEREAFTER THE ITAT KOLKATA BENCHES HAD EXAMINED IN DETAIL THE PRODUCTI ON PROCESS INVOLVED. THE TRIBUNAL HELD THAT IN THE PROCESS OF PRODUCING POULTRY FEED MORE THAN 31 MATERIALS WERE CONSUMED. THE PROCESS OF PRODUCING POULTRY FEED INV OLVED MECHANICAL, CHEMICAL & ELECTRICAL PROCESSES FOR WHICH THE APPELLANT USED S OPHISTICATED PLANT & MACHINERY. IN THE COURSE OF PRODUCTION OF POULTRY FEED RAW- MATER IALS WHICH EXCEEDED 30 IN NUMBERS, LOST INDIVIDUAL IDENTITY AND THE EMERGING PRODUCT W AS DISTINCT AND SEPARATE IN SHAPE, CHARACTER AND END-USE. THE RAW- MATERIALS CONSUMED IN PRODUCTION OF POULTRY FEED COULD BE INDIVIDUALLY USED FOR DIFFERENT PURPOSES, BUT THE END PRODUCT AT THE END OF INTEGRATED PRODUCTION PROCESS WAS KNOWN TO TRADE BY ITS DISTINCT COMMERCIAL NAME AS POULTRY FEED. IT COULD ONLY BE CONSUMED BY ONLY O NE CLASS OF CONSUMER I.E. POULTRY & NONE ELSE. THE TRIBUNAL HELD THAT EVEN AS PER CRITE RIAS LAID DOWN BY THE SUPREME COURT IN THE DECISIONS RELIED UPON BY THE REVENUE IT COUL D STILL BE HELD THAT THE APPELLANT WAS ENGAGED IN MANUFACTURE OR PRODUCTION OF AN ARTICLE OR THING BECAUSE THE PRODUCT POULTRY FEED WAS KNOWN TO THE TRADE, COMMERCE AND I NDUSTRY AS SEPARATE AND DISTINCT FROM VARIOUS MATERIALS CONSUMED IN THE PROCESS OF I TS PRODUCTION. THE TRIBUNAL ALSO NOTED THAT POULTRY FEED MANUFACTURING INDUSTRY WAS NOTIFIED BY THE CENTRAL GOVERNMENT TO BE ELIGIBLE FOR CLAIMING DEDUCTION FOR A CONSECU TIVE PERIOD OF 10 YEARS U/S 801B(4) OF THE ACT WHERE THE UNDERTAKING WAS LOCATED IN ANY OF THE NORTH EASTERN STATES. DEDUCTION BOTH U/S 801B (4) & (5) COULD BE ALLOWED ONLY IF NEWLY SET UP INDUSTRIAL UNDERTAKING WAS ENGAGED IN MANUFACTURE AND PRODUCTI ON OF AN ARTICLE. THE TRIBUNAL HELD THAT IF POULTRY FEED INDUSTRY WAS CONSIDERED E LIGIBLE BY THE CENTRAL GOVERNMENT FOR CLAIMING DEDUCTION U/S 801B(4) THEN THE SAME INDUST RY COULD NOT BE CONSIDERED TO BE NOT ITA NO.1311/KOL/2012 M/S.AMRICON AGROV ET PVT. LIMITED A.YR.2009-10 3 ELIGIBLE FOR DEDUCTION U/S 8016(5) ON THE GROUND AT IT WAS NOT ENGAGED IN MANUFACTURE OR PRODUCTION OF AN ARTICLE. SINCE FACTS OF THE APP ELLANTS CASE ARE PARI-MATERIA, THE DECISION OF THE JURISDICTIONAL ITAT IS SQUARELY BIN DING ON ME. 7.3 IN THE IMPUGNED ORDER THE AO IN THE FIRST INSTA NCE HELD THAT IN THE PRODUCTION PROCESS EXPLAINED BY THE APPELLANT, THERE WAS NO CH ANGE IN CHEMICAL COMPOSITION OF THE END PRODUCT AND THEREFORE THERE WAS NO MANUFACTURE. HOWEVER, IN THE LATTER PART, THE AO HIMSELF CONTRADICTED THIS FINDING BY OBSERVING T HAT IN THE HEATING CONDITIONS THE CHEMICALS SUCH AS; POTASSIUM IODATE AND POTASSIUM C HLORIDE DEBONDED SEPARATING IODINE AND CHLORINE WHICH MADE THE POULTRY FEED POI SONOUS. IN IT THERE WAS FACIT ADMISSION BY THE AO THAT IN HEATING CONDITIONS, CHE MICAL COMPOSITION OF THE RAW MATERIALS UNDERWENT CHANGE. HOWEVER BEFORE RECORDIN G SUCH AN AUTHENTIC TECHNICAL FINDING, THE AO HOWEVER DID NOT REFER TO ANY SCIENT IFIC DATA OR SCIENTIFIC EXPERIMENTS OR TECHNICAL REPORT TO SUPPORT HIS CONCLUSION. THE AO S FINDING THAT IN HEATING CONDITIONS END THE PRODUCT TURNED TO BE POISONOUS WAS A SERIOU S FINDING WHICH COULD NOT BE ARRIVED AT LIGHTLY. THERE WAS NO SCIENTIFIC DATA OR MATERIA L BEFORE THE AO ON THE BASIS OF WHICH HE COULD RECORD A FINDING THAT THE PRODUCT TURNED O UT TO BE POISONOUS BECAUSE OF THE USE OF POTASSIUM IODATE AND POTASSIUM CHLORIDE. AT LEAS T IN THE ASSESSMENT ORDER THE AO HAS NOT REFERRED TO ANY SCIENTIFIC DATA WITH REFERE NCE TO WHICH THE FINDING WAS RECORDED. BEFORE ME THE A/RS FILED SCIENTIFIC LITERATURE FROM WHICH IT APPEARED THAT POTASSIUM IODATE WAS COMMERCIALLY ACCEPTED CHEMICAL FOR PROVI DING IODINE IN ANIMAL FEED. THE APPELLANT HAS ALSO FILED SCIENTIFIC LITERATURE RECO MMENDING OPTIMUM LEVELS OF VARIOUS CHEMICALS WHICH NEED TO BE PRESENT IN POULTRY FEED AS PER WHICH IODINE UP TO 300MG PER KG IS CONSIDERED AS NON TOXIC WHEREAS AS PER BIS SPECIFICATIONS IODINE UP TO 1.5 MG PER KG IN POULTRY FEED WAS CONSIDERED OPTIMUM. IN A SSESSEES CASE IODINE CONTENT WAS 1.5MG PER KG OF POULTRY FEED. POTASSIUM CHLORIDE WA S ALSO USED IN FEED AND FEED SUPPLEMENT BECAUSE USE OF THIS CHEMICAL ALLOWED THE CHICKS TO GAIN WEIGHT. THE SCIENTIFIC PAPER PUBLISHED BY THE SCIENTISTS IN JAP AN SUPPORTED APPELLANTS CLAIM THAT THE IDEAL TEMPERATURE FOR PRODUCTION PROCESS OF FEED MA NUFACTURING WAS AROUND 83C WHICH COMPARES FAVOURABLY WITH THE APPELLANTS PRODUCTION PROCESS WHICH WAS CARRIED ON IN STEAM HEATING CONDITIONS VARYING IN 800 TO 85C. FR OM THE ASSESSMENT RECORDS, I ALSO FIND THAT BEFORE RECORDING SUCH AUTHORITATIVE FINDI NG NO OPPORTUNITY OF HEARING OR REBUTTING HIS PRESUMPTIONS WAS GRANTED BY THE AO AN D THESE FINDINGS WERE RECORDED WITHOUT DISCLOSING SCIENTIFIC OR TECHNICAL EXPERTIS E WITH REFERENCE TO WHICH THE FINDING WAS RECORDED BY THE ASSESSING OFFICERS. HAVING REGA RD TO THE TOTALITY OF THE FACTS THEREFORE I DO NOT FIND SUBSTANCE IN THE AOS CONCL USION THAT THE USE OF POTASSIUM IODATE OR POTASSIUM CHLORIDE TURNED THE POULTRY FEE D POISONOUS. FROM THE FACTS ON RECORD IT APPEARS THAT THERE WAS NO SCIENTIFIC OR E MPIRICAL DATA AVAILABLE, TO SUPPORT THE AOS CONCLUSION WHICH DID APPEARED TO BE HAVE BEEN BASED ON ANY SCIENTIFIC OR TECHNICAL DATA. MOREOVER, THE ITAT, KOLKATA ON THE IDENTICAL FACTS HAS HELD THAT THE POULTRY FEED MANUFACTURING UNDERTAKINGS ARE ELIGIBL E FOR CLAIMING U/S 801B(5). THE DECISION OF THE ITAT, KOLKATA BEING HIGHER JURISDIC TIONAL FORUM IS BINDING ON ME. THE CENTRAL GOVERNMENT HAS NOTIFIED THE POULTRY FEED MA NUFACTURING INDUSTRY TO BE AN ELIGIBLE INDUSTRY FOR CLAIMING DEDUCTION U/S 801B(4 ). THERE BEING NO CHANGE IN THE FACTUAL MATRIX IN THE APPEALANTS CASE; THE ONLY CO NCLUSION THAT CAN BE DRAWN ON THE FACTS OF THE CASE IS THAT THE APPELLANTS HAJIPUR U NDERTAKING WAS ENGAGED IN PRODUCTION OF AN ARTICLE. FOR THE REASONS DISCUSSED IN THE FOR EGOING THEREFORE I HOLD THAT THE APPELLANT WAS ENTITLED FOR CLAIMING DEDUCTION U/S 8 01B(5). THE AO SHALL ACCORDINGLY ALLOW THE DEDUCTION WITH REFERENCE TO THE ASSESSED BUSINESS INCOME OF THE SAID UNDERTAKING. ITA NO.1311/KOL/2012 M/S.AMRICON AGROV ET PVT. LIMITED A.YR.2009-10 4 9. WE HAVE HEARD THE RIVAL SUBMISSIONS. THE ONLY I SSUE INVOLVED IN THIS GROUND RELATES TO WHETHER THE ASSESSEE IS ENGAGED IN THE M ANUFACTURE OF A PRODUCTION OF AN ARTICLE SO THAT IT MAY BE ELIGIBLE FOR DEDUCTION UN DER SECTION 80IB. THIS ISSUE HAS DULY BEEN DECIDED BY THIS BENCH IN ASSESSEES SISTER CON CERN IN ITA NO.1505/KOL/2007 IN THE CASE OF ACIT-VS- AMRIT FEEDS LTD., KOLKATA, IN WHIC H, THE SIMILAR ISSUE HAS ARISEN AND RESTORED. WHILE DECIDING THE SIMILAR ISSUE, THIS TR IBUNAL OBSERVED AS UNDER VIDE PARA 15 TO 18 OF ITS ORDER. 15. SEC 801B (2) (III) REQUIRES THE ELIGIBLE INDU STRIAL UNDERTAKING TO BE ENGAGED IN MANUFACTURE OF PRODUCTION OF AN ARTICLE. THE SAID SECTION HOWEVER, DOES NOT DEFINE THE EXPRESSION MANUFACTURE OR PRODUCTION OF AN ARTICLE . IN FACT THIS EXPRESSION IS NOT DEFINED IN THE ACT ALSO. THE LD. CIT (A) EXTENSIVEL Y ANALYSED MEANING OF THE SAID EXPRESSION WITH REFERENCE TO JUDICIAL DECISIONS DIS CUSSED IN HIS ORDER. THE TEST LAID DOWN BY THE COURTS IS WHETHER THE EMERGING NEW PRODUCT I S KNOWN TO THE TRADE, INDUSTRY AND COMMERCE BY ITS OWN NAME HAVING ITS OWN APPLICATION USE AND HAS A MARKET OF ITS OWN. APPLYING THE CRITERIAS LAID DOWN IN THESE JUDICIAL DECISIONS WE FIND THAT IN PHYSICAL APPEARANCE, COLOUR AND SHAPE THE. POULTRY FEED VAST LY DIFFERS FROM THE INPUT MATERIALS. THE POULTRY FEED IS MANUFACTURED IN A SCIENTIFIC AN D SYSTEMATIC MANNER WITH THE USE AND ASSISTANCE OF SOPHISTICATED PLANT AND MACHINERY ACQ UIRED AT A SUBSTANTIAL COST. POULTRY FEED IS RECOGNISED NOT ONLY BY TRADE AND COMMERCE B UT ALSO BY THE STATUTORY AUTHORITIES UNDER CENTRAL EXCISE, SALES TAX ETC AS INDEPENDENT PRODUCTS APPLYING THE RATIO LAID DOWN IN JUDICIAL DECISIONS DISCUSSED IN THE ORDER O F CTT(A) WE HAVE NO HESITATION IN HOLDING THAT THE ASSESSEE IS ENGAGED IN MANUFACTURE OR PRODUCTION OF AN ARTICLE, CONTEMPLATED IN SEC 801B (2) (III) . 16. WE ALSO FIND ON THE IDENTICAL FACTS THE BANGALO RE BENCH OF ITAT IN THE CASE OF KOMRALA FEEDS VS- DCIT 74 ITD 65 HELD THAT ACTIVIT Y OF PRODUCING POULTRY FEED AMOUNTS TO MANUFACTURE AND THEREFORE ELIGIBLE FOR D EDUCTION U/S 80 I. SEC 80I AND SEC 80IB ARE PARAMETERIA BECAUSE CONDITIONS FOR PART OF DEDUCTION ARE SAME AND THEREFORE THE SAID DECISION IS EQUALLY APPLICABLE IN THE PRES ENT CASE. 17. SECTION 80IB IS AN INCENTIVE PROVISION OF THE I NCOME TAX ACT ENACTED, BY THE LEGISLATURE TO PROMOTE ECONOMIC AND INDUSTRIAL GROW TH IN BACKWARD DISTRICTS AND STATES. IN THE CASE OF BAJAJ TEMPO LTD VS. CIT (196 ITR 18 8) THE SUPREME COURT HAS OPINED THAT A PROVISION OF TAXING STATUTE GRANTING INCENTI VES FOR PROMOTING GROWTH AND DEVELOPMENT SHOULD BE CONSTRUED LIBERALLY AND SINCE A PROVISION FOR PROMOTING ECONOMIC GROWTH HAS TO BE INTERPRETED LIBERALLY THE RESTRICTION THEREON TOO HAS TO BE CONSTRUED SO AS TO ADVANCE THE OBJECTIVE OF THE PRO VISION AND NOT TO FRUSTRATE IT. CONDITIONS OF SEC 801B (2) (III) SHOULD BE FULFILLE D BY EVERY NEW INDUSTRIAL UNDERTAKING CLAIMING DEDUCTION EITHER/UNDER SUB SEC (3) (4) OR (5) OF SEC 80 IB I.E. TO SAY THE UNDERTAKING MUST BE ENGAGED IN MANUFACTURE OR PRODU CTION OF AN ARTICLE. IF THIS CONDITION IS NOT FULFILLED NO DEDUCTION IS PERMISSI BLE UNDER ANY OF THE SUB SECTIONS OF SEC 801B. THE INDUSTRIAL UNDERTAKINGS NOTIFIED AND APPR OVED BY THE CENTRAL GOVT. AND SITUATED IN NORTH EASTERN STATES ARE ELIGIBLE FOR T AX HOLIDAY FOR PERIOD OF 10 YEARS AS AGAINST PERIOD OF 5 YEARS AVAILABLE TO OTHER BACKWA RDS STATES. IN NOTIFICATION NO. SO 627 (E) DATED 04.08.1999 THE CENTRAL GOVERNMENT HAS RECOGNISED POULTRY AND CATTLE FEED INDUSTRY, TO BE AN ELIGIBLE INDUSTRY U/S 80 IB (4). ONCE THE CENTRAL GOVERNMENT NOTIFIED THE POULTRY FEED INDUSTRY U/S 80 IB (4) T HEN THERE IS A TACIT ADMISSION THAT IT IS ENGAGED IN MANUFACTURE OR PRODUCTION OF AN ARTICLE . THIS IS SO BECAUSE UNLESS POULTRY FEED INDUSTRY DOES NOT MANUFACTURE AN ARTICLE; NO D EDUCTION CAN BE PERMISSIBLE U/S 80 ITA NO.1311/KOL/2012 M/S.AMRICON AGROV ET PVT. LIMITED A.YR.2009-10 5 IB. ONCE THE CENTRAL GOVT. ACCEPTED IN PRINCIPLE TH AT POULTRY FEED IS AN ELIGIBLE INDUSTRY U/S 80IB(4); THEN THE VERY SAME INDUSTRY CANNOT BE CONSIDERED AS NON MANUFACTURING INDUSTRY UNDER SUB SECTIONS (3) AND (5) OF SEC 80 1B. WITH REFERENCE TO SAME SET OF FACTS THE REVENUE CANNOT HOLD THE POULTRY .FEED INDUSTRY AS MANUFACTURING INDUSTRY IF SITUATED IN NORTH EASTERN STATES AND A PROCESSING INDUSTRY IF SITUATED IN ANY OTHER STATES SUCH AN INTERPRETATION WILL ONLY LEAD TO AN ABSURD LEGAL POSITION. 18. FOR THE REASONS AS SET OUT HEREIN BEFORE THEREF ORE WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) HOLDING THE ASSESSEE TO BE ENGAGED IN MANUFACTURE OR PRODUCTION OF AN ARTICLE WE ARE THEREFORE OF THE CONSIDERED OPINION THAT THE ASSESSEE SATISFIES THE CONDITIONS OF SEC 80-IB(2) (III) OF THE ACT AND IS THEREFORE ELIGIBLE FOR DEDUCTION U/S 80IB WE THEREFORE UPHOLD THE ORDER OF CIT (A) DIRECTING A 0 TO ALLOW DEDUCTION U/S 80 IB TO THE ASSESSEE. 10. FROM PERUSAL OF THE SAID DECISION OF THIS TRIB UNAL, IT IS APPARENT THAT THIS TRIBUNAL HAS CATEGORICALLY HELD IN THE CASE THAT TH E ASSESSEE IS ENGAGED IN MANUFACTURING OF POULTRY FEEDS AND THAT THE ASSESSE E IS ENGAGED IN THE MANUFACTURE OR PRODUCTION OF AN ARTICLE. NO CONTRARY DECISION OF T HE COORDINATE BENCH OR THE JURISDICTIONAL HIGH COURT OR THAT HONBLE SUPREME C OURT WAS BROUGHT TO OUR KNOWLEDGE WHICH MAY HAVE TAKEN A CONTRARY VIEW. THE LD. DR, EVEN THOUGH RELIED ON THE DECISION OF THE HYDERABAD BENCH A OF THE TRIBUNAL IN THE CASE OF VENKATESWARA FEEDS & FEEDS VS- ACIT 22 TAXMANN.COM 234 (HYD.) B UT WE NOTED THAT THE UNDERTAKING FOR WHICH THE ASSESSEE HAS CLAIMED THE DEDUCTION UNDER SECTION 80IB WAS MERELY ENGAGED IN CONVERTING THE POULTRY MASH FEED INTO PELLET FEED AND THEREFORE THAT BENCH HAS HELD THAT THERE WAS NO CHANGE IN THE BASI C COMPONENT OR NEW OR DIFFERENT ARTICLE CAME INTO EXISTENCE. AS SUCH, CONVERSION WA S PROCESSING ACTIVITY NOT MANUFACTURING. THE CASE OF THE ASSESSEE IS ENTIRELY DIFFERENT. THE ASSESSEES ELIGIBLE UNDERTAKING ITSELF WAS INDEPENDENTLY CARRYING OUT T HE COMPLETE ACTIVITY I.E. FROM MIXING, GRINDING TILL THE PELLETISATION. THE RAW MATERIALS ONCE CONSUMED CANNOT BE RECONVERTED INTO THE SAME POSITION. ITS UTILITY GETS CHANGED. T HE PRIME RAW MATERIALS SUCH AS, MAIZE, SOYA OIL, RICE BRAN, ETC. CAN NO MORE BE REGARDED T O BE THE RICE BRAN, SOYA OIL, MAIZE. WE, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THIS BENCH, CONFIRM THE ORDER OF THE CIT(A). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AS IT IS NOTICED THAT THE ISSUE IN THE REVENUES APPEAL IS SQUARELY COVERED BY THE DECISIO N OF THE COORDINATE BENCH OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE EARLIER YEA RS RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL I N ASSESSEES OWN CASE THE FINDING OF LD. CIT(A) ON THIS ISSUE STANDS CONFIRMED. ITA NO.1311/KOL/2012 M/S.AMRICON AGROV ET PVT. LIMITED A.YR.2009-10 6 6. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMI SSED. . ORDER PRONOUNCED IN THE OPEN COURT ON 17.12.2013. SD/- SD/- [SHAMIM YAHYA] [ GEORGE MATHAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 17.12.2013. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1. M/S.AMRICON AGROVET PVT.LTD., DAG NO.35, MOUJA-ARGO RI, NEAR JINDAL FACTORY, SNAR, HOWRAH-711302. 2 D.C.I.T., CIRCLE-2, KOLKATA 3 . CIT(A)-I, KOLKATA 4. CIT - KOLKATA. 5. CIT(A)DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES