ACIT, CHENNAI V. M/s. Cauvery Enterprises, CHENNAI

ITA 268/CHNY/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 5051 (ITAT-CHENNAI)
• Duration Of Justice: 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 18-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: TAPAS KUMAR DUTTA
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI BEFORE SHRI HARI OM MARATHA, J.M. AND SHRI N.S. SAINI, AM .. I.T.A. NO. 268/MDS/2011 ASSESSMENT YEARS 2004-05 THE A.C.I.T CIRCLE XV CHENNAI VS. M/S CAUVERY ENTERPRISES NO. 8, IIND STREET GANAPATHY COLONY CHENNAI (PAN NO. AAAFC 3959J ) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI PHILIP GEORGE DEPARTMENT BY : SHRI TAPAS KUMAR DUTTA O R D E R PER N.S. SAINI, A.M :- THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER PASSED BY THE LD. CIT(A)-XII, CHENNAI DATED 29.11.20 10 FOR ASSESSMENT YEAR 2004-05. PAGE 2 OF 5 I.T.A. NO. 268/MDS/2011 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL IS THAT T HE COMMISSIONER OF INCOME-TAX [APPEALS] ERRED IN ALLOWING DEDUCTION U/S 10B OF THE INCOME-TAX ACT, 1961 [IN SHORT, THE ACT] RELYING ON THE DECISION OF THE TRIBUNAL IN THE CASE OF M/S CAUVERY ENTERPRISES VS. ACIT IN ITA NO. 129/MDS/2007 DATED 20.3.2008. 3. AT THE VERY OUTSET, THE LD. A.R. OF THE ASSESSE E SHRI PHILIP GEORGE SUBMITTED THAT THE TRIBUNAL IN ASSESSEES OW N CASE IN ITA NO. 389/MDS/2009 VIDE ORDER DATED 11.12.2009 DISMIS SED THE APPEAL OF THE REVENUE. HE, THEREFORE, PRAYED THAT FACTS AND CIRCUMSTANCES OF THE INSTANT CASE ARE IDENTICAL AND HENCE APPEAL OF THE REVENUE SHOULD BE DISMISSED. 4. THE LD. D.R. SHRI TAPAS KUMAR DUTTA ALSO CONCURR ED WITH THE ABOVE SUBMISSIONS OF THE LD. A.R. OF THE ASSESSEE. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THE INSTANT CASE, THE ASSESSEE IS E NGAGED IN THE BUSINESS OF MANUFACTURE AND EXPORT OF GRANITE PRODU CTS AND GRINDING MILL. THE ASSESSING OFFICER DENIED CLAIM OF EXEMPT ION U/S 10B OF PAGE 3 OF 5 I.T.A. NO. 268/MDS/2011 THE ACT TO THE ASSESSEE FOR THE REASON THAT ASSESSE E WAS NOT ENGAGED IN THE MANUFACTURE OF ANY ARTICLE OR THING WITHIN T HE MEANING OF THE SAID SECTION AND THAT THE ASSESSING OFFICER ALSO DI D NOT TREAT THE SALE OF THE ASSESSEE TO ANOTHER 100% EXPORT ORIENTED UNI T AS EXPORT FOR THE REASON THAT ASSESSEE HAD NOT RECEIVED THE SALE PROCEEDS IN CONVERTIBLE FOREIGN EXCHANGE. 6. IN APPEAL, THE COMMISSIONER OF INCOME-TAX [APPEA LS], FOLLOWING THE DECISION OF THIS TRIBUNAL IN ASSESSEE S OWN CASE FOR ASSESSMENT YEAR 2003-04 IN ITA NO. 129/MDS/2007 DAT ED 20.3.2008 HELD THAT THE PROCESS UNDERGONE IN THE ASSESSEES I NDUSTRIAL UNDERTAKING TANTAMOUNTS TO MANUFACTURING PROCESS M AKING IT ELIGIBLE FOR THE CLAIM OF EXEMPTION U/S 10B OF THE ACT AND HENCE DIRECTED THE ASSESSING OFFICER TO ALLOW CLAIM OF EX EMPTION U/S 10B OF THE ACT. FURTHER, THE COMMISSIONER OF INCOME-TA X [APPEALS], ALSO FOLLOWING THE DECISION IN AHMEDABAD BENCH OF THE TR IBUNAL IN THE CASE OF ITO VS. ANITA SYNTHETICS P. LTD [2006] 100 TTJ [AHD] 227 HELD THAT ANY SALES BY ONE 100% EXPORT ORIENTED UNIT TO ANOTHER 100% EXPORT ORIENTED UNIT AMOUNTS TO AN EXPORT. ACCORDI NGLY, HE HELD THAT THE SALE OF GRANITE MONUMENTS BY THE ASSESSEE TO ANOTHER 100% PAGE 4 OF 5 I.T.A. NO. 268/MDS/2011 EXPORT ORIENTED UNIT WAS EXPORT OF GOODS MAKING THE APPELLANT ELIGIBLE FOR CLAIM OF DEDUCTION U/S 10B ON THIS SAL ES ALSO. HE ALSO HELD THAT THE PROCEEDS OF SALE TO 100% EXPORT ORIEN TED UNIT WAS RECEIVED BY THE ASSESSEE IN CONVERTIBLE FOREIGN EXC HANGE, AND THEREFORE, DIRECTED THE ASSESSING OFFICER TO CONSID ER THE SALE OF GRANITE MONUMENTS MADE TO ANOTHER 100% EXPORT ORIEN TED UNIT AT PAR WITH EXPORTS MADE ABROAD WHILE ALLOWING EXEMPTI ON U/S 10B OF THE ACT AFTER VERIFYING DETAILS OF CONVERTIBLE FORE IGN EXCHANGE RECEIVED IN INDIA BY THE ASSESSEE. 7. WE FIND THAT BOTH THE PARTIES BEFORE US HAVE AGR EED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE D EICISON OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2003-04. AS THE LD. D.R. COULD NOT POINT OUT ANY DISTINGUISHING FEA TURES OR CHANGE IN THE FACTS, WE DO NOT FIND ANY INFIRMITY IN THE ORDE R OF THE COMMISSIONER OF INCOME-TAX [APPEALS] ALLOWING CLAIM FOR DEDUCTION U/S 10B OF THE ACT TO THE ASSESSEE. THEREFORE, WE CONFIRM THE ORDER OF THE COMMISSIONER OF INCOME-TAX [APPEALS] AND DIS MISS THE GROUND OF APPEAL OF THE REVENUE. PAGE 5 OF 5 I.T.A. NO. 268/MDS/2011 8. IN THE RESULT, APPEAL FILED BY THE REVENUE STAND S DISMISSED. ORDER PRONOUNCED IN THE COURT ON 24.5.2011. SD/- SD/- ((HARI OM MARATHA ) (N.S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 24 TH MAY, 2011. VL COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE