ITO Ward-24 (1), V. Lavleen Sinha,

ITA 2075/DEL/2008

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 69630 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 5 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 29-10-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 27-05-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHUMANA SEN
• Assessee Lawyers: DR RAKESH GUPTA
• Section: 143(3); 80HHC; 10B; 28

Judgement Text

ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D NEW DELHI BEFORE SHRI J.S. REDDY, ACCOUNTANT MEMBER AND SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER ITA NO. 838/DEL/2007 ASSESSMENT YEAR: 2003-04 DY.COMMISSIONER OF INCOME TAX, CIRCLE 24(1), NEW DELHI. VS. SMT. LAVLEEN SINHA, K-81, HAUS KHAS, NEW DELHI ITA NO. 775/DEL/2012 ASSESSMENT YEAR: 2006-07 ASSTT.COMMISSIONER OF INCOME TAX, CIRCLE 24(1), NEW DELHI. VS. SMT. LAVLEEN SINHA, K-81, HAUS KHAS, NEW DELHI ITA NO. 2075/DEL/2008 ASSESSMENT YEAR: 2004-05 INCOME TAX OFFICER, WARD 24(1), NEW DELHI. VS. SMT. LAVLEEN SINHA, K-81, HAUS KHAS, NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : MS SHUMANA SEN, DR RESPONDENT BY : DR. RAKESH GUPTA O R D E R PER CHANDRA MOHAN GARG, J.M. THE APPEALS IN ITA NOS. 838/D/07 AND2 075/D/08 HAVE BEEN PREFERRED BY THE REVENUE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(A), XXIII, NEW DELHI IN APPEAL NO. AND 157/06-07 AND 563/06-07 FOR AYS 2003-04 AND 2004-05 RESPECTIVELY. APPEAL IN ITA NO. 775/D/ 12 PREFERRED BY THE ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 2 REVENUE IS ON THE SAME ISSUE AGAINST THE ORDER OF C OMMISSIONER OF INCOME TAX-XII, NEW DELHI DATED 30.11.2011 IN APPEAL NO.19 8/11-12 FOR AY 2006-07. IT IS PERTINENT TO MENTION HERE THAT ALL APPEALS ARE RELATED TO SEPARATE ORDERS PASSED BY FIRST APPELLATE AUTHORITY BUT RELATED TO SOLE ISSUE OF ALLOWABILITY OF EXEMPTION U/S 10B OF INCOME TAX ACT , 1961 (FOR SHORT THE ACT), THEREFORE, WE ARE DECIDING ALL THREE APPEALS BY THIS CONSOLIDATED ORDER. 2. IN ITA NO.838/DEL/2007 FOR AY 2003-04 AND ITA NO .2075/D/08 FOR AY 2004-05, REVENUE HAS RAISED AS MANY AS 13 GROUND S BUT EXCEPT GROUND NO. 1 & 2 IN BOTH THE APPEALS, REMAINING ROUND NO. 3 TO 13 ARE ARGUMENTATIVE TO THE MAIN GROUNDS. THE MAIN GROUNDS WHICH DESERV E TO BE DECIDED BY US IN BOTH THESE APPEALS READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DIRECTING THE ASSESSING OFFICER TO ALLOW EXEMPTION U/S 10B AS CLAIMED BY TH E ASSESSEE IN RESPECT OF THE CONCERN M/S BLUE PEARL. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING TH AT THE ASSESSEE WAS ELIGIBLE FOR DEDUCTION U/S 10B EVEN THOUGH IT D ID NOT FULFILL THE CONDITIONS PRESCRIBED U/S 10B(2)(II) & (III). 3. IN ITA NO.775/D/12, THE SOLE GROUND RAISED BY TH E REVENUE READS AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) HAS ERRED IN ALLOWING THE BENEFIT OF DEDUCT ION CLAIMED ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 3 UNDER SECTION 10B OF THE I.T.ACT, 1961 AMOUNTING TO RS.9,48,864/-. 4. BRIEF FACTS GIVING RISE TO THESE APPEALS ARE THA T M/S BLUE PEARL IS A PROPRIETORSHIP CONCERN OF THE ASSESSEE AND PRIOR TO 1.2.2002, IT WAS IN THE BUSINESS OF EXPORT OF HANDICRAFTS ETC. CLAIMING DED UCTION U/S 80HHC OF THE ACT. SUBSEQUENTLY, FROM 1.2.2002, THE ASSESSEE CLA IMED THAT THE UNIT STARTED MANUFACTURING OF HANDICRAFTS AS A NEW INDUSTRIAL UN DERTAKING FORMED BY CONVERTING THE DOMESTIC TARIFF AREA (DTA) INTO A 10 0% EXPORT ORIENTED UNIT (EOU) BY OBTAINING PERMISSION FROM NEW EXPORT PROMOTION ZONE (NEPZ) DATED 02.05.2001. THUS, THE ASSESSEE IN ITS RETURN OF INCOME FOR AY 2002-03 CLAIMED DEDUCTION U/S 80HHC OF THE ACT FOR THE FIRST TEN MONTHS AND FOR THE REMAINING LAST TWO MONTHS, THE ASSESSEE CLAIMED DEDUCTION U/S 10B OF THE ACT. THE ASSESSING OFFICER DISALLOWED T HE DEDUCTION U/S 10B OF THE ACT ON THE GROUND THAT IN PERCENTAGE TERMS THE VALUE OF OLD PLANT AND MACHINERY TRANSFERRED TO THE 100% EOU FOR WHICH THE EXEMPTION U/S 10B HAS BEEN CLAIMED COMES TO 82.62% WHICH EXCEEDS THE LIMIT OF 20% AS PROVIDED FOR IN EXPLANATION TO SECTION 10B(2) OF TH E ACT. THE ASSESSING OFFICER FURTHER HELD THAT IN TERMS OF ABOVE FACTS, THE CONDITIONS PRESCRIBED IN SECTION 10B(2)(II) AND (III) WERE NOT FULFILLED AND THUS DEDUCTION U/S 10B COULD NOT BE ALLOWED TO THE ASSESSEE. BEING AGGRIE VED BY THE ABOVE ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 4 ASSESSMENT ORDERS, THE ASSESSEE PREFERRED APPEALS B EFORE THE COMMISSIONER OF INCOME TAX(A) WHICH WERE ALLOWED BY THE IMPUGNED ORDERS AS MENTIONED IN PARA 1 HEREINABOVE. NOW THE REVENUE IS BEFORE T HIS TRIBUNAL WITH THESE SECOND APPEALS WITH THE MAIN GROUNDS AS MENTIONED H EREINABOVE. 5. WE HAVE HEARD RIVAL ARGUMENTS OF BOTH THE PARTIE S AND CAREFULLY PERUSED THE RECORD, ORDERS OF THE AUTHORITIES BELOW AND WRITTEN SUBMISSIONS AND CITATIONS PLACED BEFORE US BY BOTH THE PARTIES. 6. LD. DR SUBMITTED THAT THE ASSESSEE CLAIMED DEDUC TION U/S 10B OF THE ACT BUT THE VALUE OF OLD PLANT AND MACHINERY TRANSF ERRED TO 100% EOU COMES TO 82.62% WHICH EXCEEDS THE PRESCRIBED LIMIT OF 20% AS PROVIDED BY EXPLANATION TO SECTION 10B(2) OF THE ACT. THE DR F URTHER SUBMITTED THAT DEDUCTION U/S 10B COULD NOT BE ALLOWED BECAUSE IN D ETERMINING THE VALUE OF OLD PLANT AND MACHINERY, THE ASSESSING OFFICER INCL UDED THE VALUE OF VEHICLES, OFFICIAL FACTORY EQUIPMENTS BY INVOKING DEFINITION OF PLANT AS PROVIDED IN SECTION 43(3) OF THE ACT BY FOLLOWING THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF SCIENTIFIC ENGINEERING HOUSE P . LTD. VS COMMISSIONER OF INCOME TAX(1986) 157 ITR 86(SC) . THE DR FURTHER SUBMITTED THAT ANOTHER GROUND OF DISALLOWANCE TAKEN BY THE ASSESSING OFFICER WAS THAT THE ASSESSEE FAILED TO PROVE ITS CLAIM IN TERMS OF CBDT CIRCULAR NO. 694 DATED 22.11.1994 RELATING TO CONVERSION OF DTA UNIT INTO 100% EOU. ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 5 7. THE DR VEHEMENTLY CONTENDED THAT DESPITE REASONA BLE AND JUSTIFIED FINDINGS OF THE ASSESSING OFFICER, THE COMMISSIONER OF INCOME TAX(A) ALLOWED THE APPEAL OF THE ASSESSEE BY OBSERVING THA T PRIOR TO BECOMING 100% EOU, THE APPELLANT WAS SIMPLY ENGAGED IN TRADING BU SINESS AND NO MANUFACTURING ACTIVITIES WERE THERE AND THE MANUFAC TURING UNDERTAKING OF THE APPELLANT WAS A NEW BUSINESS AND IT CAME INTO EXISTENCE ONLY WHEN PLANT AND MACHINERY WAS INSTALLED FOR THE FIRST TIME AND THE ASSESSEE OBTAINED 100% EOU CERTIFICATE. THE DR POINTED OUT THE FINDI NGS OF THE COMMISSIONER OF INCOME TAX(A) IN THE IMPUGNED ORDER THAT THE UNDERTAKING WHICH CAME INTO EXISTENCE WAS A TOTALLY SEPARATE, I NTEGRATED INDEPENDENT UNIT AND HAD NOTHING TO DO WITH THE ERSTWHILE BUSINESS O F THE APPELLANT AND SUBMITTED THAT THESE FINDINGS OF THE COMMISSIONER O F INCOME TAX(A) ARE BASED ON HYPER TECHNICAL APPROACH, IGNORING THE FAC TUAL MATRIX OF THE CASE. 8. THE DR ALSO POINTED OUT THAT THE COMMISSIONER OF INCOME TAX(A) HAS ERRED IN HOLDING THAT THE OFFICE EQUIPMENTS AND VEH ICLES ETC. USED BY THE ERSTWHILE BUSINESS CANNOT BE CONSTRUED TO BE PLANT AND MACHINERY FOR THE PURPOSE OF DENYING DEDUCTION U/S 10B OF THE ACT, PA RTICULARLY WHEN THESE WOULD NOT FORM INTEGRATED PART OF PLANT AND MACHINE RY USED FOR THE PURPOSE OF MANUFACTURING. THE DR ALSO CONTENDED THAT THE C OMMISSIONER OF INCOME TAX(A) WAS NOT JUSTIFIED IN HOLDING THAT PART OF P LANT AND MACHINERY WHICH ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 6 CAN BE USED FOR THE PURPOSE OF MANUFACTURING OF ANY ARTICLE OR THING, IF TRANSFERRED TO NEW UNDERTAKING, CAN BE TAKEN INTO A CCOUNT SO AS TO WORK OUT THE LIMIT OF 20% AS REQUIRED BY LAW BUT NOT THE OTH ER ASSETS. THE DR FINALLY SUBMITTED THAT THE COMMISSIONER OF INCOME TAX(A) HA D NOT CONSIDERED THE ALTERNATE GROUND OF THE ASSESSING OFFICER FOR DISAL LOWING THE DEDUCTION U/S 10B IN VIEW OF THE CBDT CIRCULAR RELATING TO CONVER SION OF DTA UNITS TO A 100% EOU AS MENTIONED BY THE ASSESSING OFFICER IN H IS ORDER. THE DR POINTED OUT CLAUSE (III) OF CIRCULAR NO.1/2005 DATE D 6.1.2005 WHICH READS AS UNDER:- (III) UNDERTAKING C IS SET UP IN DOMESTIC TARIFF AREA IN THE FINANCIAL YEAR 2000-01 RELEVANT TO A.Y. 2001- 02 AND ENGAGED IN THE BUSINESS OF PROVIDING COMPUTE R RELATED SERVICES, OTHER THAN THOSE NOTIFIED BY THE BOARD FOR THE PURPOSES OF SECTION 10B. IN FINANCIAL YEAR 200 2-03, IT ACQUIRES MORE THAN 20% OF OLD PLANT AND MACHINERY A ND STARTS MANUFACTURING COMPUTER SOFTWARE. IT ALSO GET S APPROVAL AS 100% EOU IN THE FINANCIAL YEAR 2002-03. UNDERTAKING C SHALL NOT BE ELIGIBLE FOR DEDUCTION U/S 10B AS THERE HAS BEEN TRANSFER OF OLD PLANT AND MACHINERY. 9. THE DR SUBMITTED THAT THE IMPUGNED ORDERS MAY BE SET ASIDE BY RESTORING THAT OF THE ASSESSING OFFICER. 10. REPLYING TO THE ABOVE, LD. COUNSEL OF THE ASSES SEE SUBMITTED A COPY OF THE ASSESSMENT ORDER OF THE ASSESSEE FOR THE AY 200 9-10 PASSED U/S 143(3) OF THE ACT WHEREIN THE ASSESSING OFFICER HAS ALLOWE D DEDUCTION U/S 10B OF ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 7 THE ACT TO THE ASSESSEE AMOUNTING TO RS.14,39,354. THE COUNSEL ALSO PLACED HIS RELIANCE ON THE JUDGMENT OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS MAXIM INDIA INTEGRATED CIRCUIT DESIGN (PVT.) LTD. (2011) 202 TAXMAN 365 (K ARNATAKA) AND COMMISSIONER OF INCOME TAX VS EXPORT OUTSOURCE PVT. LTD. (2011) 243 CTR (KARNATAKA) 411 AND JUDGMENT OF ITAT AHMEDABAD B BENCH IN THE CASE OF ITO VS INFOCHIPS LTD. (2009) 25 DTR 299 . THE COUNSEL SUPPORTING THE IMPUGNED ORDER CONTENDED THAT THE AS SESSING OFFICER DENIED THE DEDUCTION U/S 10B OF THE ACT ON TWO COUNTS; FIR ST THE ASSESSEE VIOLATED THE CONDITION PRESCRIBED U/S 10B(2)(III) OF THE ACT AND SECONDLY, THE NEWLY FORMED INDUSTRIAL UNDERTAKING WAS CONVERTED FROM DO MESTIC TARIFF AREA UNIT TO 100% EOU BY USING SAME INFRASTRUCTURE, PLANT AND MACHINERY AND OTHER MANUAL FORCE. THE COUNSEL SUBMITTED THAT THESE WRO NG PERCEPTIONS WERE RIGHTLY CORRECTED BY COMMISSIONER OF INCOME TAX(A) BY HOLDING THAT THE ASSESSEE IS ENTITLED FOR EXEMPTION U/S 10B OF THE A CT. THE COUNSEL FOR THE ASSESSEE POINTED OUT THE RELEVANT OPERATIVE PARAS O F THE IMPUGNED ORDER WHICH READ AS UNDER FOR AY 2003-04:- NOW THE CONTENTION OF THE APPELLANT IS FOUND TO BE CORRECT. THE BASIS PURPOSE AND INTENT OF THE LAW IS TO PROVIDE SUCH TAX HOLIDAY FOR A FIXED NUMBER OF YEAR S AND NOT PERPETUALLY .IF SUCH CONDITIONS WERE NOT LAID D OWN IN THE LAW. IT COULD HAVE BEEN MISUSED BY SOME OF THE ASSESSEES SIMPLY BY CHANGING NAME OF THE BUSINESS ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 8 CONCERN OR CHANGING HANDS OF THE BUSINESS UNDERTAKI NG AND THEREBY ENJOYING THE EXEMPTION FOR UNLIMITED NU MBER OF YEARS. THE OBJECT OF THE LAW IS TO PROVIDE THE B ENEFIT OF EXEMPTION ONLY WHEN THE PLANT & MACHINERY IS INSTAL LED FOR THE FIRST TIME AND WHERE THE VALUE OF THE PLANT & M ACHINERY OF ERSTWHILE BUSINESS UNDERTAKINGS IS LESS THAN 20% OF TOTAL COST OF THE PLANT & MACHINERY INSTALLED. HERE IS OF CASE WHERE NO PLANT & MACHINERY WAS NEVER INSTALLED EARL IER TO F.Y. 2001-02. PRIOR TO BECOMING 100% EOU, THE APPEL LANT WAS SIMPLY ENGAGED IN THE BUSINESS OF TRADING. BECA USE OF THESE REASONS ONLY NO EXEMPTION U/S 10B WAS EVER CL AIMED NOR IT COULD HAVE BEEN CLAIMED AS IT IS ALLOWABLE T O A MANUFACTURING UNDERTAKING ONLY. THE MANUFACTURING UNDERTAKING OF THE APPELLANT WAS A FRESH BUSINESS A ND IT CAME INTO EXISTENCE ONLY WHEN PLANT & MACHINERY WAS INSTALLED FOR THE FIRST TIME AND THE ASSESSEE OBTAI NED 100% EOU CERTIFICATE. THE A.O. OBSERVED THAT PRODUCTION UNDER 100% EOU WAS CONVERTED ON 1.2.2002 AND THUS THE ASSESSEE'S OLD PROPRIETORSHIP CONCERN M/S BLUE PEAR L WAS CONVERTED INTO 100% EOU DURING THE FINANCIAL YEAR 2 001- 02. HOWEVER THE CORRECT POSITION IS THAT MANUFACTUR ING UNDERTAKING STARTED FUNCTIONING W.E.F. 1.2.2002 AND THUS CAME INTO EXISTENCE DURING THE FINANCIAL YEAR 2001- 02 AND SINCE PRIOR TO THIS THERE WAS NO MANUFACTURING UNDE RTAKING IN EXISTENCE. THERE WAS NO QUESTION OF TRANSFER OF ASSETS FROM THE ERSTWHILE MANUFACTURING UNIT TO THE NEW ON E. THE UNDERTAKING WHICH CAME INTO EXISTENCE WAS A TOTALLY SEPARATE. INTEGRATED INDEPENDENT UNIT AND HAD NOTHI NG TO DO WITH THE ERSTWHILE BUSINESS OF THE APPELLANT. TH E ESTABLISHMENT OF A NEW INDUSTRIAL UNIT AS A PART OF AN ALREADY EXISTING INDUSTRIAL ESTABLISHMENT MAY RESUL T IN AN EXPANSION OF THE INDUSTRY BUT IF THE NEWLY ESTABLIS HED UNIT IS ITSELF AND INTEGRATED INDEPENDENT UNIT IN WHICH NEW PLANT AND MACHINERY ARE PUT UP AND ARE THEMSELVES INDEPENDENTLY TO THE OLD UNIT, CAPABLE OF PRODUCTIO N OF GOODS, THEN IT CAN BE CLASSIFIED AS A NEWLY ESTABLI SHED INDUSTRIAL UNDERTAKING. THIS WAS THE VIEW OF THE BO MBAY HIGH COURT AS HELD IN THE CASE OF CIT VS ACC LTD. ( 1979) 118 ITR 406 (BORN). IN THE PRESENT CASE ALSO THE UNDERTAKING ESTABLISHED BY THE APPELLANT WAS ALTOGE THER A ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 9 NEW UNIT NOT DEPENDENT ON THE OLD EXISTING BUSINESS OF THE APPELLANT NOR IT HAD ANYTHING TO DO WITH, THE ERSTW HILE BUSINESS OF THE APPELLANT. IT STARTED FOR THE FIRST TIME PRODUCING ARTICLE OR THING INDEPENDENTLY FROM FINAN CIAL YEAR 2001-02 ONLY, AND THEREFORE THE APPELLANT WAS ELIGIBLE FOR EXEMPTION U/S 10B IN RESPECT OF THE IN COME FROM SUCH UNDERTAKING AS HELD IN THE CASE OF CIT VS ROHTAS INDUSTRIES LTD. (1979) 120 ITR 110 (CAL.), WHERE T HE FINDINGS WERE THAT THE NEW UNIT WAS STARTED BY FRES H OUTLAY OF CAPITAL AND MANUFACTURED OR PRODUCED ARTICLES YI ELDING ADDITIONAL PROFITS HAVING A SEPARATE PHYSICAL INDEP ENDENT EXISTENCE, IT WAS HELD THAT IT WAS A NEW INDUSTRIAL UNDERTAKING ELIGIBLE FOR TAX CONCESSION, THE APPELL ANT'S FACTS OF THE CASE BEING IDENTICAL THE APPELLANT WAS ALSO ELIGIBLE FOR TAX EXEMPTION U/S 10B. IN THE ASSESSEE 'S CASE NEITHER THERE WAS ANY SPLITTING UP OR RECONSTRUCTIO N OF BUSINESS UNDERTAKING IN EXISTENCE- AND THEREFORE TH ERE WAS NO QUESTION OF CONSTRUING THAT THE PLANT & MACHINER Y OF ERSTWHILE BUSINESS OF THE APPELLANT WERE TRANSFERRE D TO THE NEW UNDERTAKING. IN THE CASE OF CIT VS ORIENT PAPER MILLS LTD. (1974) 93 ITR 73 (CAL), ASSESSEE, A PAPER MANUFACTURER, SET UP A NEW AND SEPARATE PLANT FOR PRODUCTION OF CASTIC SODA, RAW MATERIAL USED IN PAP ER MANUFACTURE. IT WAS HELD BY THE HON'BLE COURT THAT THIS SET UP WAS NOT BY WAY OF SPLITTING UP OR RECONSTRUCTION OF AN EXISTING BUSINESS HENCE DID NOT DISENTITLE THE ASSE SSEE OF TAX HOLIDAY CONCESSION. HERE IS ALSO A CASE WHERE A NEW UNIT WAS SET UP FOR THE FIRST TIME WHICH HAD NOTHI NG TO DO WITH THE ERSTWHILE BUSINESS AND THEREFORE THE APPEL LANT WAS ALSO ENTITLED FOR EXEMPTION U/S 10B. SECONDLY THE O FFICE EQUIPMENTS AND VEHICLES ETC BEING USED BY THE ERSTW HILE BUSINESS, FOR THE PURPOSE OF APPLICATION OF THE PRO VISION OF SECTION L0B, CANNOT BE CONSTRUED TO BE PLANT AND MACHINERY, PARTICULARLY WHEN IT WOULD NOT FORM INTE GRATED PART OF THE PLANT & MACHINERY USED FOR THE PURPOSE OF MANUFACTURING. THUS THAT PART OF THE PLANT & MACHIN ERY WHICH CAN BE USED FOR THE PURPOSE OF MANUFACTURING OF ANY ARTICLE OR THING, IF TRANSFERRED TO NEW UNDERTAKING CAN. BE TAKEN INTO ACCOUNT SO AS TO WORK OUT THE LIMIT OF 2 0% AS REQUIRED BY LAW BUT NOT THE OTHER ASSETS. IT SHOULD BE KEPT ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 10 IN MIND THAT THE BENEFIT CANNOT BE DENIED BY-INTERP RETING THE LAW IN SUCH A WAY THAT IT DEFEATS IT VERY PURPO SE. AS HELD IN THE CASES OF CIT VS GACKWAR FOAM & RUBBER C O. (1959) 35 ITR 662 (BORN), CIT VS SIMPSON & CO. (198 0) 122 ITR 283 (MAD) AND CIT VS SANGHI BEVERAGES PVT.L TD. (1982) 134 ITR 623 (MP), IT IS A WELL SETTLED CANON OF CONSTRUCTION THAT THE PROVISION RELATING TO EXEMPTI ON OR CONCESSION MUST AS FAR AS POSSIBLE BE LIBERALLY CON STRUED AND IN FAVOUR OF THE ASSESSEE PROVIDED IN DOING SO NO VIOLENCE WAS BEING DONE TO THE LANGUAGE USED, THE PROVISIONS OF SECTION 10B SHOULD BE INTERPRETED IN SUCH A WAY THAT IT SPELLS OUT THE CORRECT MEANING OF THE L AW AND FULFILLS ITS OBJECTS. IT HAS BEEN HELD IN THE CASE OF CIT VS SATELLITE ENGINEERING LTD. (1978) 113 ITR 208 (GUJ. ) THAT THESE PROVISIONS MUST BE INTERPRETED IN CONSONANCE WITH THE AVOWED AIM AND OBJECTS OF THE LEGISLATURE IN EN ACTING THESE PROVISIONS AND TO FURTHER THESE AND NOT TO DE FEAT THESE. IN THE PRESENT CASE SINCE THE MANUFACTURING UNIT STARTED FUNCTIONING FROM FINANCIAL YEAR 2001-02 FOR THE FIRST TIME AND AS THE OFFICE EQUIPMENTS AND OTHER INSIGNIFICANT AND NON ESSENTIAL ASSETS, WHICH WERE NOT REQUIRED FOR THE PURPOSE OF MANUFACTURING, COULD NO T BE CONSTRUED AS A PART OF PLANT & MACHINERY OF THE MANUFACTURING UNIT, THE APPELLANT WAS ENTITLED FOR DEDUCTION U/S 10B OF THE ACT. THE A.O. IS THEREFORE , DIRECTED TO ALLOW EXEMPTION U/S 10B AS CLAIMED. 11. LD. COUNSEL OF THE ASSESSEE SUBMITTED THE CONTE NTIONS ON TWO COUNTS. FIRSTLY, IT IS SUBMITTED THAT CLAUSE (III) OF CIRCU LAR NO. 1/2005 DATED 6.1.2005 IS NOT APPLICABLE TO THE CASE OF THE ASSESSEE BECAU SE THE ASSESSEE CONVERTED ITS DTA UNIT INTO 100% EOU AND OBTAINED EOU CERTIFI CATE ON 02.05.2001, HENCE, THE ASSESSEE GOT APPROVAL AS 100% EOU WHICH STARTED MANUFACTURING OF HANDICRAFTS FOR EXPORT FROM 01.02.2002. THE COU NSEL SUBMITTED THAT CLAUSE (I) OF CIRCULAR NO. 1/2005 CLARIFIES THAT WH EN A DTA UNIT GETS ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 11 APPROVAL AS 100% EXPORT ORIENTED UNIT, THEN IT SHAL L BE ELIGIBLE FOR DEDUCTION U/S 10B OF THE ACT FROM THE YEAR OF COMMENCEMENT OF MANUFACTURING AS 100% EOU I.E. IN THE YEAR IN WHICH THE UNIT FULFILL S THE BASIC CONDITION OF BEING A 100% EOU AND DEDUCTION U/S 10B OF THE ACT S HALL BE AVAILABLE ONLY FOR THE REMAINING PERIOD UPTO AY 2009-10. THE COUN SEL REITERATED ITS EARLIER ARGUMENT AND SUBMITTED THAT THE ASSESSEE WAS ALLOWE D DEDUCTION U/S 10B OF THE ACT FOR THE AY 2002-03, 2005-06 AND RECENTLY IN AY 2009-10 IN THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT. 12. SECONDLY, LD. COUNSEL OF THE ASSESSEE CONTENDED THAT WITHOUT PREJUDICE TO THE ABOVE ARGUMENT, IF IT IS PRESUMED THAT CLAUS E (III) OF CIRCULAR NO.1/2005 DATED 6.1.2005 IS APPLICABLE TO THE ASSES SEE, EVEN THEN AS PER DECISION OF HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF HYDERABAD DECCAN CIGARETTES FACTORY VS COMMISSIONER OF INCOME TAX (1999) 236 ITR 615 AND ANOTHER DECISION OF HONBLE KERALA HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS TRAVAN CORE MATS AND MATTINGS CO. (1998) 229 ITR 93 (KERALA) , THE DEFINITION OF PLANT U/S 43(3) OF THE ACT IS NOT APPLICABLE TO THE DEFINITION OF PLANT AND MACHINERY WHICH NEEDS INTERPRETATION IN THE PRESENT CASE. IT IS AL SO POINTED OUT BY THE COUNSEL THAT AS PER ABOVE DECISIONS, THE VALUE OF VEHICLES AND MOTOR CARS IS TO BE EXCLUDED FROM THE VALUE OF PLANT AND MACHINERY BECA USE ONLY SUCH PLANT AND ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 12 MACHINERY ARE TO BE CONSIDERED WHICH ARE USED IN MA NUFACTURING AND VEHICLES, OFFICE EQUIPMENTS, COMPUTER CANNOT BE SAI D TO BE PLANT AND MACHINERY AS CONTEMPLATED U/S 10B(2)(III) OF THE AC T. 13. WE HAVE HEARD RIVAL ARGUMENTS OF BOTH THE PARTI ES AND CAREFULLY PERUSED THE MATERIAL AND CITATIONS PLACED AND RELIE D BY BOTH THE PARTIES. 14. FROM THE ORDERS OF THE AUTHORITIES BELOW, WE CL EARLY OBSERVE THAT ACCORDING TO THE ASSESSING OFFICER, PLANT AND MACHI NERY FROM DTA UNIT WERE TRANSFERRED TO 100% EOU AND OLD PLANT AND MACH INERY INCLUDING VEHICLES TRANSFERRED TO EOU UNITS COMES TO 82.62% A ND THEREFORE CONDITION PRESCRIBED U/S 10B (2)(III) WAS VIOLATED BY THE ASS ESSEE. THE ASSESSING OFFICER ALSO HELD THAT THE ASSESSEE IS NOT ENTITLED TO DEDUCTION U/S 10B OF THE ACT FOR THE REASON BECAUSE THE ASSESSEE CONVERTED D TA UNIT INTO 100% EOU. PER CONTRA, THE COMMISSIONER OF INCOME TAX(A) ALLOWED EXEMPTION U/S 10B OF THE ACT BY HOLDING THAT THERE WAS NO SPL ITTING UP OR RECONSTRUCTION FROM THE OLD UNIT TO PRESENT 100% EOU OF THE ASSESS EE AND VEHICLES AND OFFICE EQUIPMENTS USED BY THE ASSESSEE IN EARLIER D TA UNIT CANNOT BE CONSIDERED AS PLANT AND MACHINERY USED FOR FORMATIO N OF 100% EOU FOR APPLYING 80-20% TEST AS PER CLAUSE (III) OF CBDT CI RCULAR NO.1/2005 DATED 6.1.2005. ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 13 15. AT THE OUTSET, FROM THE ASSESSMENT ORDER PARA 3 .2, WE OBSERVE THAT THE ASSESSING OFFICER HAS NOT DISPUTED THE FACT THAT TH E ASSESSEE CONVERTED ITS DTA UNIT INTO 100% EOU AND PRODUCTION UNDER 100% CO MMENCED ON 1.2.2002 AND THE ASSETS OF THE BUSINESS WHICH WAS B EING CARRIED OUT IN THE DTA WERE TAKEN OVER BY 100% OF THE EOU. IN THE LIG HT OF ABOVE FACTS, AS PER CLAUSE (I) OF CIRCULAR NO.1/2005 PLACED IN ASSESSEE S PAPER BOOK AT PAGE 58- 59 EXPLAINS THAT THE UNDERTAKING SET UP IN DTA AND SUBSEQUENTLY APPROVED AS 100% WOULD BE ENTITLED FOR DEDUCTION. THE COUNSEL OF THE ASSESSEE HAS PLACED RELIANCE ON THE JUDGMENT OF ITAT AHMEDABAD IN THE CASE OF ITO VS ANITA SYNTHETICS PVT. LTD. 100 TTJ 227 AND IN THE CASE OF E-INFOCHIPS LTD. 124 TTJ 176 WHEREIN IT HAS BEEN HELD THAT WHEN THE OWNERSHIP, MANAGEMENT AND OVERALL CONTROL OF THE BUSINESS CONTINUING WITH THE SAME ASSESSEE, PRIOR AND SUBSEQUENT TO THE APPROVAL OF THE 100% EOU, IT CANN OT BE SAID THAT 100% EOU HAVE BEEN FORMED BY SPLITTING UP OR RECONSTRUCT ION OF THE OLD UNIT. 16. IN VIEW OF DECISION OF ITAT AHMEDABAD AND FACTU AL MATRIX EMERGED FROM THE FACT FINDING RECORDED BY THE ASSESSING OFF ICER, WE CLEARLY OBSERVE THAT THE ASSESSEE HAS NOT STARTED A NEW UNIT BY SPL ITTING UP OR RECONSTRUCTION OF OLD UNIT BUT IT WAS A CLEAR CONVERSION OF OLD DT A UNIT INTO 100% EOU WITH SAME OWNERSHIP, MANAGEMENT AND OVERALL CONTROL BY THE SAME ASSESSEE. ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 14 THEREFORE, WE HOLD THAT SECTION 10B(2)(III) HAS NO APPLICATION TO THE PRESENT CASE. 17. COMING TO THE SECOND CONTENTION OF THE COUNSEL OF THE ASSESSEE, WE FIND IT APPROPRIATE TO CONSIDER INTERPRETATION ACCE PTED BY HONBLE HIGH COURT TO DEFINE PLANT AND MACHINERY FOR THE PURPOSE OF ALLOWING DEDUCTION UNDER THE PROVISIONS OF THE ACT. THE HONBLE ANDHRA PRAD ESH HIGH COURT IN THE DECISION OF HYDERABAD DECCAN CIGARETTES FACTORY (SU PRA) HAS HELD AS UNDER:- THE AUTHORITIES BELOW HELD THAT IN VIEW OF THE DEFI NITION OF PLANT UNDER SECTION 43(3) OF THE ACT, MOTOR CARS A RE TO BE INCLUDED IN THE VALUE OF THE PLANT ; IF SO INCLUDE D, THE VALUE OF THE INDUSTRIAL UNDERTAKING EXCEEDS RS.20 LAKHS ; T HEREFORE, IT IS NOT ENTITLED TO THE INVESTMENT ALLOWANCE UNDER SECTION 32A. WE ARE OF THE VIEW THAT THE INTERPRETATION PLACED B Y THE AUTHORITIES BELOW IS NOT IN ACCORDANCE WITH THE PRO VISIONS OF THE ACT FOR THE FOLLOWING REASON : AT THIS STAGE, IT IS NECESSARY TO REFER TO THE DEFI NITION OF 'PLANT' CONTAINED IN SECTION 43(3) (AS IT STOOD AT THE RELE VANT TIME) WHICH PROVIDES THAT IN SECTIONS 28 TO 41 AND IN TH IS SECTION, UNLESS THE CONTEXT OTHERWISE REQUIRES, 'PLANT' INC LUDES SHIPS, VEHICLES, BOOKS, SCIENTIFIC APPARATUS AND SURGICAL EQUIPMENT USED FOR THE PURPOSES OF THE BUSINESS OR PROFESSION . FROM A READING OF SECTION 43(3), UNLESS THE CONTEXT OTHERWISE REQUIRES, THE EXPRESSION 'PLANT' INCLUDES VEHICLES ALSO. IN OTHER WORDS, IF THERE IS A SEPARATE DEFINITION OF PLANT OTHER THAN THE DEFINITION COVERED BY SECTION 43(3), THE DEFINITION OF PLANT UNDER SECTION 43(3) HAS NO APPLICATION. WE H AVE ALREADY POINTED OUT IN THE EARLIER PARAGRAPH THAT E XPLANATION (2) TO SUB SECTION (2) OF SECTION 32A DEFINES A SM ALL SCALE INDUSTRIAL UNDERTAKING. IT DEFINES A SMALL SCALE U NDERTAKING AS AN INDUSTRIAL UNDERTAKING WHOSE AGGREGATE VALUE OF MACHINERY AND PLANT (OTHER THAN TOOLS, JIGS, DIES A ND MOULDS) ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 15 INSTALLED DOES NOT EXCEED RS. 20 LAKHS. IN OTHER WORDS, AN INDUSTRIAL UNDERTAKING, WHOSE AGGREGATE VALUE OF MA CHINERY AND PLANT INSTALLED OTHER THAN THOSE ITEMS EXCLUDE D, DOES NOT EXCEED RS. 20 LAKHS, IS A SMALL SCALE INDUSTRIAL U NDERTAKING. SINCE THERE IS AN INDEPENDENT DEFINITION IN THE CO NTEXT OF DEFINING A SMALL SCALE INDUSTRIAL UNDERTAKING, SECT ION 43(3) IS NOT APPLICABLE TO THE DEFINITION OF A SMALL SCALE I NDUSTRIAL UNDERTAKING. IF SECTION 43(3) DEFINING PLANT INCLU DING VEHICLES IS NOT APPLICABLE, THE VALUE OF THE VEHIC LES CANNOT BE ADDED TO THE VALUE OF THE PLANT AND MACHINERY INS TALLED EXCLUDING THOSE ITEMS MENTIONED IN THE SAID EXPLANA TION. THEREFORE, WE ARE OF THE VIEW THAT THE ASSESSEE IS A SMALL SCALE INDUSTRIAL UNDERTAKING WITHIN THE MEANING OF EXPLAN ATION (2) TO SECTION 32A(2)(B)(II) OF THE INCOME TAX ACT. IF THE ASSESSEE IS A SMALL SCALE INDUSTRIAL UNDERTAKING, IT IS ENT ITLED TO THE INVESTMENT ALLOWANCE UNDER SECTION 32A. FURTHER, WE ALSO OBSERVE THAT THE HONBLE KERALA HI GH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS TRAVANCORE MATS & MAT TINGS CO. (KER.)(SUPRA) HAS HELD AS UNDER:- IN OUR JUDGMENT, THIS IS NOT A SITUATION IN REGAR D TO WHICH TE RESORT TO SECTION 43(3) WOULD BE NECESSARY AT ALL B ECAUSE WHAT IS TO BE UNDERSTOOD WITH REFERENCE TO MACHINERY AND PLANT IS AVAILABLE IN THE LANGUAGE OF THE STATUTORY PROVISIO N ITSELF ABUNDANTLY ENOUGH. APART THEREFROM, EVEN THE STATUT ORY PROVISION OF SECTION 43 OF THE ACT WOULD BECOME USE FUL ONLY ON THE SATISFACTION THAT THE CONTEXT OTHERWISE REQU IRES, CREATING DIFFICULTY IN UNDERSTANDING THE TERMS OF W HICH DEFINITIONS ARE GIVEN IN SECTION 43 OF THE ACT. IN OUR JUDGMENT, RESORT TO THE PROVISIONS OF SECTION 43 OF THE ACT I S ONLY PERMISSIBLE AS CONTINGENT ON THE REQUIREMENT OF THE SITUATION GOVERNED BY THE PHRASE UNLESS THE CONTEXT OTHERWIS E REQUIRES . AS WE HAVE STATED HEREINBEFORE, THE PLAIN LANGUAG E PROVIDES ABUNDANTLY TO KNOW AS TO WHAT THE MACHINERY AND PLA NT IS TO BE UNDERSTOOD IN THE CONTEXT OF THE STATUTORY PROVI SIONS OF ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 16 SECTION 32A AS WELL AS SECTION 35B. THEREFORE, IT I S NOT POSSIBLE TO ACCEPT THE SUBMISSION OF LEARNED SENIOR TAX COUNSEL. THE CONTENTION OF THE DR IS THAT THESE CITATIONS HA VE NO APPLICATION TO THE PRESENT CASE BECAUSE WE HAVE TO CONSIDER THE ISSUE OF ALLOWABILITY OF DEDUCTION U/S 10B OF THE ACT TO THE ASSESSEE BUT TH IS CONTENTION OF THE LD. DR HAS NO LEGS TO STAND BECAUSE THE ASSESSING OFFICER ON PAGE 7 PARA 3.9 OF THE ASSESSMENT ORDER HAS CONSIDERED THE DEFINITION OF P LANT MENTIONED IN SECTION 43(3) OF THE ACT AND AS PER DECISION OF HONBLE AND HRA PRADESH HIGH COURT IN THE CASE OF HYDERABAD DECCAN CIGARETTES FACTORY VS COMMISSIONER OF INCOME TAX (SUPRA), IT HAS BEEN HELD THAT THE VEHIC LE CANNOT BE ADDED TO THE VALUE OF PLANT AND MACHINERY. THE HONBLE KERALA H IGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS TRAVANCORE MATS & MAT TINGS CO. (KER.) HAS HELD THAT UNDER THE DEFINITION OF SMALL SCALE I NDUSTRIES UNDERTAKING IN CLAUSE (II) OF THE EXPLANATION BELOW SUB-SECTION (2 ) OF SECTION 32A OF THE ACT, WHICH IS APPLICABLE FOR THE PURPOSES OF SECTIO N 35B(1A), IT IS WITH REGARD TO THE MACHINERY AND PLANT INSTALLED. IN TH IS DECISION, IT HAS ALSO BEEN HELD THAT THE STATUTORY PROVISIONS OF SECTION 43(3) OF THE ACT WOULD BECOME USEFUL ONLY ON THE SATISFACTION THAT THE CONTEXT OT HERWISE REQUIRES AND RESORT TO THE PROVISIONS OF SECTION 43 OF THE ACT IS ONLY PERMISSIBLE AS CONTINGENT ON THE REQUIREMENT OF SITUATION GOVERNED BY PRECOND ITION IMPOSED BY THE ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 17 PHRASE UNLESS THE CONTEXT OTHERWISE REQUIRES. 18. IN THE PRESENT CASE, WE ARE NOT CONSIDERING THE DEFINITION OF ONLY PLANT BUT THE PLANT AND MACHINERY USED BY THE ASSESSEE IN DTA UNIT AND THEREAFTER ITS CONVERSION INTO 100% EOU FOR THE PURPOSE OF MAN UFACTURING. AT THE COST OF REPETITION, WE HOLD THAT AS PER ABOVE DECISION O F HONBLE ANDHRA PRADESH HIGH COURT IN THE CASE OF HYDERABAD DECCAN CIGARETT E FACTORY VS C.I.T. (SUPRA) AND THE DECISION OF AND HONBLE KERALA HIGH COURT, THE TRAVANCORE MATS & MATTINGS CO. (SUPRA), DEFINITION OF PLANT ME NTIONED IN SECTION 43(3) OF THE ACT HAS NO APPLICATION AND THE VALUE OF VEHICLE S IS NOT INCLUDIBLE IN THE VALUE OF PLANT AND MACHINERY FOR THE PURPOSE OF CLA USE (III) OF CBDT CIRCULAR NO. 1/2005. ACCORDINGLY, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN INCLUDING THE VALUE OF VEHICLES FOR CALCULATING 80-20% TEST W ITH REGARD TO PLANT AND MACHINERY FOR GRANTING EXEMPTION U/S 10B OF THE ACT . 19. TO SUM UP, WE HOLD THAT FIRST OF ALL, THE ASSES SEE COMPLETED ITS DTA INTO 100% EOU WITH THE SAME MANAGEMENT, OWNERSHIP, OVERALL CONTROL, THEREFORE, WE ARE UNABLE TO ACCEPT THAT THE ASSESSE E FORMED NEW MANUFACTURING UNIT BY USING PLANT AND MACHINERY OF THE OLD UNIT BECAUSE IT WAS MERELY A CONVERSION OF DTA INTO 100% EOU AND IT CANNOT BE CONSTRUED TO BE A FORMATION OF NEW UNIT BY SPLITTING UP OR RE CONSTRUCTION OF AN OLD UNIT. THEREFORE, CLAUSE (I) OF THE CBDT CIRCULAR NO. 1/20 05 DATED 6.1.2005 IS ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 18 SQUARELY APPLICABLE TO THE PRESENT CASE. ALTERNATI VELY IF CLAUSE (III) OF CIRCULAR 1/2005 IS CONSIDERED, THEN AGAIN THE TEST OF 80-20% HAS NOT BEEN PROPERLY APPLIED BY THE ASSESSING OFFICER BECAUSE V EHICLES ARE NOT USED FOR THE PURPOSE OF MANUFACTURING IN THE UNIT OF ASSESSE E AND THE VALUE OF THE VEHICLES IS NOT INCLUDIBLE FOR THE PURPOSE OF CALCU LATION AND 80-20% TEST TO THE PRESENT CASE. IF THE VALUE OF THE VEHICLES IS EXCLUDED, THEN THE ASSESSEE QUALIFIES THE 80-20 TEST AS REQUIRED BY THE REVENUE FOR THE PURPOSE OF GRANT OF EXEMPTION U/S 10B OF THE ACT AS PER CBDT CIRCULA R NO. 1/2005. ACCORDINGLY, WE HOLD THAT THE COMMISSIONER OF INCOM E TAX(A) RIGHTLY CORRECTED THE WRONG PROPOSITION ADOPTED BY THE ASSE SSING OFFICER BY PASSING IMPUGNED ORDER AND ALLOWING EXEMPTION TO THE ASSESS EE U/S 10B OF THE ACT. 20. IN THE LIGHT OF DISCUSSIONS MADE HEREINABOVE, W E ARE OF THE OPINION THAT THE ASSESSING OFFICER DENIED THE EXEMPTION U/S 10B OF THE ACT ON WRONG AND UNJUSTIFIED GROUND BY ADOPTING A HYPER TECHNICA L APPROACH. ON THE OTHER HAND, THE COMMISSIONER OF INCOME TAX(A) RIGHTLY ALL OWED THE SAME BY USING PROPER INTERPRETATION OF THE FACTS AND LAW AP PLICABLE TO THE CASE. WE ALSO TAKE COGNIZANCE OF THE FACT THAT THE DR HAS NO T DISPUTED THE FACT THAT THE REVENUE AUTHORITIES ALLOWED EXEMPTION TO THE ASSESS EE IN AY 2001-02, 2005-06 AND 2009-10 AND WE ARE UNABLE TO SEE ANY VA LID REASON TO INTERFERE WITH THE IMPUGNED ORDERS PERTAINING TO THE PRESENT YEARS. ACCORDINGLY, MAIN ITA 838/D/2007 & OTHERS ASSTT.YEAR: 2003-04 & OHTERS 19 GROUNDS TAKEN BY THE REVENUE AS MENTIONED IN THIS O RDER DESERVE TO BE DISMISSED AND WE DISMISS THEM. OTHER GROUNDS RAISE D BY THE REVENUE ARE ARGUMENTATIVE AND SUPPORTIVE TO THE MAIN GROUNDS. SINCE MAIN GROUNDS OF THE REVENUE ARE DISMISSED, OTHER GROUNDS OF THE REV ENUE DO NOT SURVIVE FOR ADJUDICATION AND WE DISMISS THE SAME. 21. IN THE RESULT, ALL THREE APPEALS OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22.11.2013. SD/- SD/- ( J.S. REDDY ) (CHANDRA MOHAN GARG) ACCOUNTANT MEMBER JU DICIAL MEMBER DT. 22ND NOVEMBER 2013 GS COPY FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY O RDER 5. 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