M/s J.P. Stone Crushers Pvt. Ltd, Nainital V. DCIT, Nainital

ITA 350/DEL/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 53031 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 03-10-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 29-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y KAKKAR
• Assessee Lawyers: TARUN KUMAR S
• Keywords: Opportunity of being heard
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH D : NEW DELHI) SHRI A.D. JAIN, JUDICIAL MEMBER AND BEFORE SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.350/DEL./2009 (ASSESSMENT YEAR : 2005-06) M/S. J.P. STONE CRUSHERS PVT. LTD., VS. DCIT, RAMPUR ROAD, HALDWANI, DISTT. NAINITAL. HALDWANI, DISTT. NAINITAL (UTTARAKHAND) (PAN : AABCJ5662M) (APPELLANT) (RESPONDENT) ASSESSEE BY : DR. RAKESH GUPTA, SHRI ASHWANI TANEJ A AND SHRI TARUN KUMAR, ADVOCATES REVENUE BY : MS. Y. KAKKAR, DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THIS APPEAL FILED BY THE ASSESSEE ARISES OUT OF TH E ORDER OF THE CIT (APPEALS)-II, DEHRADUN DATED 14.10.2008 FOR THE ASS ESSMENT YEAR 2005-06. THE GROUNDS OF APPEAL READ AS UNDER :- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. COMMISSIONER OF INCOME TAX (APPEALS-II), DEHRADUN HAS ERRED IN LAW AND ON FACTS IN CONFIRMIN G THE ACTION OF THE ID. AO IN MAKING ADDITION OF RS.45,46 ,457/- ON ALE OF ILLEGAL TRANSPORTATION (UNDISCLOSED SALES ) ON THE BASIS OF SURMISES AND ASSUMPTIONS WITHOUT PLACING A NY CORROBORATING MATERIAL AND BY RECORDING INCORRECT F ACTS AND OBSERVATIONS PURELY ON THE BASIS OF THIRD PARTY REPORTS ITA NO.350/DEL./2009 2 THE FINDINGS WHICH WERE ALSO STAYED BY THE HIGHER AUTHORITIES. 2. THE LD. CIT (APPEALS) ALSO ERRED IN LAW AND ON T HE FACTS OF THE CASE IN CONFIRMING ADDITION OF RS.25,000/- O N A/C OF COMPOUNDING FEES FOR ILLEGAL MINING IMPOSED BY DIST RICT MAGISTRATE, NAINITAL WHICH HAD NOT BEEN PAID AND DE BITED IN THE BOOKS OF ACCOUNTS ON ALE OF OBJECTIONS RAISE D FOR THE OTHER ADDITIONS ON ALE OF ILLEGAL TRANSPORTATION AN D STOCK, WHICH HAS SINCE BEEN STAYED. 3. THE LD. CIT (APPEALS) ALSO ERRED IN LAW AND ON T HE FACTS OF THE CASE IN NOT GIVING BENEFIT OF PROVISIONS OF SECTION 80IB OF THE ACT WHICH ARE APPLICABLE TO THE UNIT AN D THE SAME WAS NOT CLAIMED IN THE ORIGINAL RETURN INADVER TENTLY. 4. THAT THE APPELLANT CRAVES THE LEAVE TO ADD, MODI FY, AMEND OR DELETE ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING AND ALL THE ABOVE GROUNDS ARE WITHOUT PREJU DICE TO EACH OTHER. 2. THE ASSESSEE COMPANY IS ENGAGED IN THE MANUFACTU RING OF STONE GRITS AND DARA (MIXTURE OF SMALL STONES AND STONE DUST FR OM BOULDERS AND STONE). THESE BOULDERS AND STONES ARE EXTRACTED FROM GOLA R IVER FROM HALDWANI AFTER ACQUIRING RIGHTS FROM FOREST DEPARTMENT OF UTTARANC HAL GOVERNMENT. A SURVEY WAS CONDUCTED IN THE PREMISES OF THE ASSESSE E BY THE FOREST DEPARTMENT/PWD AND REVENUE DEPARTMENT, UTTARANCHAL AND ON THAT BASIS, THE DISTRICT MAGISTRATE, NAINITAL PASSED AN ORDER O N 19.03.2005 WHEREIN IT WAS HELD THAT ASSESSEE HAS DONE ILLEGAL TRANSPORTATION AND ILLEGAL MINING OF 518 CUB.MTS. OF STONE. THE ASSESSING OFFICER MADE AN A DDITION ON THE BASIS OF ITA NO.350/DEL./2009 3 UNDISCLOSED SALES IN GROUND NO.1 AND LEVY OF PENALT Y OF RS.25,000/- IN GROUND NO.2. 3. WHILE PLEADING ON BEHALF OF THE ASSESSEE, THE LE ARNED AR SUBMITTED THAT ON THE SIMILAR FACTS AND CIRCUMSTANCES, THE ADDITIO NS MADE IN THE CASES OF OTHER ASSESSEES WHO ARE ALSO OPERATING FROM THE SAM E PLACE AND HE PLEADED THAT IN OTHER CASES, THE ITAT HAS SET ASIDE THE ISS UE TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER PROVIDING REAS ONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. FOR THIS, THE LEARNED AR SU BMITTED TRUE COPIES OF THE ORDER OF ITAT IN THE CASE OF M/S. UTTARAKHAND STONE PRODUCTS PVT. LTD. IN ITA NO.347/DEL/2009 OF BENCH H, NEW DELHI DATED 2 6.04.2010 AND M/S. JAI SHREE RAM STONE CRUSHERS (I) PVT. LTD. IN ITA N O.348/DEL/2009 OF BENCH D, NEW DELHI DATED 26.09.2011. HE PLEADED THAT T HE MATTER MAY BE RESTORED BACK TO THE ASSESSING OFFICER. 4. LEARNED DR WAS ALSO NOT HAVING ANY SERIOUS OBJEC TION TO THIS PROPOSITION. 5. AFTER HEARING BOTH THE SIDES, WE FIND THAT THE I TAT IN ITA NO.348/DEL/2009 OF BENCH D, NEW DELHI HAS HELD AS UNDER :- 9. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. 10. IN THE CASE OF M/S. UTTARAKHAND STONE PRODUCTS PVT. LTD., THE AO MADE CERTAIN ADDITIONS ON ACCOUNT OF ILLEGAL MINING AND UNDISCLOSED STOCK IN THE LIGHT OF THE ORDER OF THE DISTRICT MAGISTRATE, NAINITAL, DATED 19.03.2005. THE TRIBUN AL AFTER HEARING BOTH THE PARTIES, RESTORED THE MATTER BACK TO THE FILE OF ITA NO.350/DEL./2009 4 THE AO FOR RE-ADJUDICATION VIDE ORDER DATED 26 TH APRIL, 2010. IT RUNS AS UNDER:- 5. WE HAVE DULY CONSIDERED THE RIVAL CONTENTIONS A ND GONE THROUGH THE RECORDS CAREFULLY. NO DOUBT THERE WAS SURVEY BY THE FOREST DEPARTMENT, REVENUE DEPARTMENT AND PWD OF THE STATE OF UTTARAKHAND. BUT THE PROCEEDINGS ARISING FROM SUCH SURVEY FOR THE PURPOS E OF DETERMINING THE VIOLATION OF THE TERMS OF LEASE AGREEMENT ETC. HAVE NOT ATTAINED FINALITY. THE PEN ALTY IMPOSED BY THE LD. DISTRICT MAGISTRATE, NAINITAL FO R SUCH VIOLATION IS UNDER CHALLENGE BEFORE THE DIVISI ONAL COMMISSIONER, NAINITAL. THUS, THE INFORMATION IN T HE SHAPE OF ANY CORROBORATIVE EVIDENCE CONSIDERED BY T HE A.O. FOR CHARGING THE ASSESSEE WITH HAVING EXCESS S TOCK IS PREMATURE INFORMATION. CONSIDERING THIS ASPECT, WE SET ASIDE THIS ISSUE TO THE FILE OF THE A.O. FOR RE - ADJUDICATION. HE SHALL TAKE INTO CONSIDERATION THE OUTCOME OF SURVEY CARRIED OUT BY THE AUTHORITIES OF THE STATE GOVERNMENT AS CORROBORATIVE PIECE OF EVIDENCE AND THEN DETERMINE THE ISSUE WHETHER THE ASSESSEE H AS EXCESS TOCK OR NOT AT THE END OF THE ACCOUNTING YEA R. THIS INFORMATION RECEIVED FROM THE STATE GOVERNMENT WOULD BE THE INFORMATION, WHICH COMES OUT AFTER THE DETERMINATION OF ISSUE IN PURSUANCE OF THE ORDER OF DIVISIONAL COMMISSIONER, NAINITAL. NEEDLESS TO SAY THAT OBSERVATION MADE BY US WILL NOT IMPAIR OR INJURE TH E CASE OF THE A.O. OR WOULD CAUSE ANY PREJUDICE TO TH E DEFENSE/ EXPLANATION OF THE ASSESSEE IN THE FRESH PROCEEDINGS. THE A.O. SHALL AFFORD DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. 11. SIMILARLY, IN THE CASE OF M/S. KRISHNA STORE INDUSTRIES PVT. LTD., THE ADDITION MADE BY THE A.O. ON THE BAS IS OF MATERIAL FOUND DURING THE COURSE OF SURVEY AND IN T HE LIGHT OF DISTRICT MAGISTRATE, NAINITALS ORDER DATED 19.03.2 005, HAS BEEN RESTORED BACK TO THE FILE OF THE AO BY THE TRI BUNAL VIDE ORDER DATED 23.12.2009 FOR FRESH ADJUDICATION. 12. IN THE LIGHT OF THE AFORESAID TRIBUNALS ORD ERS IN THE CASES BASED ON IDENTICAL FACTS, WE ARE INCLINED TO RESTOR E THE ISSUES INVOLVED IN THIS APPEAL BACK TO THE FILE OF THE AO FOR HIS FRESH ITA NO.350/DEL./2009 5 ADJUDICATION AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND IN THE LIGHT OF THE OBSER VATIONS MADE BY THE ITAT IN THE CASES OF M/S. UTTARAKHAND STONE PRODUCTS PVT. LTD. AND M/S. KRISHNA STORE INDUSTRIES PVT. L TD. WE ORDER ACCORDINGLY. 13. IN THE RESULT, APPEAL FILED BY THE ASSESSE E IS TREATED TO BE ALLOWED FOR A STATISTICAL PURPOSE. THE FACTS BEING THE SAME, WE ARE ALSO INCLINED TO R ESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER PROVIDING AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE ON THE SAME TERMS AS IN THE CASE CITED ABOVE. GROUND NOS.1 & 2 ARE ALLOWED FOR STATISTICAL PURPOS ES. 6. IN THE GROUND NO.3, THE ISSUE RAISED IS AGAINST NOT ALLOWING THE BENEFITS OF THE PROVISIONS OF SECTION 80IB OF THE ACT. THE CLAIM OF 80IB WAS NOT MADE IN THE ORIGINAL RETURN OF INCOME. ON THIS ISSUE, T HE LEARNED AR SUBMITTED THAT THE ASSESSEE HAS NOT MADE CLAIM U/S 80IB IN THE RET URN OF INCOME. THE LEARNED AR SUBMITTED THAT EVEN NO CLAIM WAS MADE IN THE RETURN OF INCOME THEN ALSO THE ASSESSEE IS ELIGIBLE TO GET THE BENEF IT OF DEDUCTION U/S 80IB. HE PLEADED THAT THE OBJECTIVE OF THE INCOME TAX PROCEE DINGS IS TO ASSESS FAIR AMOUNT OF INCOME AND TAX PAYABLE AS PER LAW. THE R EVENUE CANNOT PLAY THE GAME OF SEEK AND HIDE. IF ANY CLAIM IS ALLOWABLE T O THE ASSESSEE AND ASSESSEE OMITS TO MAKE CLAIM IN THE RETURN, IT WAS THE DUTY OF THE ASSESSING OFFICER TO INFORM THE ASSESSEE ABOUT SUCH OMISSION AND GIVE HI M OPPORTUNITY TO MAKE CLAIM AS PER LAW. EVEN IF THE ASSESSEE DOES SOMETH ING CONTRARY TO LAW, THE ASSESSING OFFICER HAS TO DISCHARGE HIS DUTY FOR MAK ING THE FAIR ASSESSMENT. ITA NO.350/DEL./2009 6 HE PLEADED THAT THE ARTICLE 265 OF THE CONSTITUTION OF INDIA PROVIDES THAT NO TAX CAN BE COLLECTED EXCEPT BY AUTHORITY OF LAW. F OR THIS PROPOSITION, HE RELIED ON THE DECISION OF RAMLAL VS REWA COALFIELD LTD., A IR 1962 SC 361 WHEREIN IT IS HELD THAT THE STATE AUTHORITIES SHOULD NOT RA ISE TECHNICAL PLEAS IF THE CITIZENS HAVE A LAWFUL RIGHT IS BEING DENIED TO THE M MERELY ON TECHNICAL GROUNDS. THE STATE AUTHORITIES CANNOT ADOPT THE ATT ITUDE WHICH PRIVATE LITIGANTS MIGHT ADOPT. HE ALSO RELIED ON THE DECISION OF HON 'BLE DELHI HIGH COURT IN THE CASE OF CIT VS BHARAT GENERAL REINSURANCE CO LT D., 81 ITR 303 (DEL.), WHEREIN THE HON'BLE HIGH COURT HAS HELD AS UNDER :- 'IT WAS TRUE THAT THE ASSESSEE ITSELF HAD INCLUDED THAT DIVIDEND INCOME IN ITS RETURN FOR THE YEAR IN QUESTION, BUT THERE WAS NO ESTOPPEL IN THE INCOME-TAX ACT AND THE ASSESSEE HAV ING ITSELF CHALLENGED THE VALIDITY OF TAXING THE DIVIDEND DURI NG THE YEAR OF ASSESSMENT IN QUESTION, IT MUST BE TAKEN THAT IT HA D RESILED FROM THE POSITION WHICH IT HAD WRONGLY TAKEN WHILE FILIN G THE RETURN. QUIT APART FROM IT, IT WAS INCUMBENT ON THE INCOME- TAX DEPARTMENT TO FIND OUT WHETHER A PARTICULAR INCOME WAS ASSESSABLE IN THE PARTICULAR YEAR OR NOT. MERELY BE CAUSE THE ASSESSEE WRONGLY INCLUDED THE INCOME IN ITS RETURN FOR A PARTICULAR YEAR, IT COULD NOT CONFER JURISDICTION O N THE DEPARTMENT TO TAX THAT INCOME IN THAT YEAR EVEN THOUGH LEGALLY SUCH INCOME DID NOT PERTAIN TO THAT YEAR. THEREFORE THE INCOME FROM DIVIDEND WAS NOT ASSESSABLE DURING THE ASSESSMENT YEAR 1958- 59, BUT IT WAS ASSESSABLE IN THE ASSESSMENT YEAR 1953-54. IT C OULD NOT, THEREFORE, BE TAXED IN THE ASSESSMENT YEAR 1958-59. ' HE FURTHER RELIED ON THE DECISION OF GUJARAT HIGH C OURT IN THE CASE OF CIT VS KEISER-E-HIND MILLS CO. LTD., 128 ITR 486 (GUJ.), W HEREIN THE HON'BLE HIGH ITA NO.350/DEL./2009 7 COURT RELIED UPON THE CIRCULAR ISSUED BY THE CBDT A ND THE RELEVANT PORTION OF THE SAID CIRCULAR READ AS UNDER :- IN VIEW OF THE CIRCULAR NO. 14(XI-35) OF 1955 DAT ED 11-4-1955, IT WAS CLEAR THAT FOR THE PURPOSE OF THE CIRCULAR, WHAT SHOULD BE THE GUIDING FACTOR WAS WHETHER THE PROCEEDINGS OR O THER PARTICULARS BEFORE THE INCOME-TAX OFFICER AT THE ST AGE OF ORIGINAL ASSESSMENT DISCLOSED ANY GROUNDS FOR RELIEF UNDER S ECTION 2(5) (A) (III ) OF THE FINANCE ACT OF 1964 OR OF THE FIN ANCE ACT OF 1965, EVEN THOUGH NO CLAIM WAS MADE FOR THAT RELIEF BY THE ASSESSEE AT THE STAGE OF THOSE PROCEEDINGS BEFORE H IM. EVEN IF THERE IS A DEVIATION ON A POINT OF LAW, SO FAR AS THE CIRCULAR OF THE BOARD IS CONCERNED, THAT CIRCULAR W ILL BE BINDING ON ALL OFFICERS CONCERNED WITH THE EXECUTION OF THE ACT AND THEY MUST CARRY OUT THEIR DUTIES IN THE LIGHT OF THE CIR CULAR. IN VIEW OF THIS CLEAR POSITION REGARDING THE EFFECT OF THE CIRCULAR, IT WAS OBVIOUS THAT IN THE INSTANT CASE IT WAS INCU MBENT ON THE INCOME-TAX OFFICER TO ADVISE THE ASSESSEE TO CLAIM RELIEF UNDER SECTION 2(5)(A)(III) IF THE PROCEEDING OR ANY OTHER PARTICULARS BEFORE HIM AT THE STAGE OF THE ORIGINAL ASSESSMENT INDICATED THAT THE ASSESSEE WAS ENTITLED TO SUCH RELIEF UNDER THE PROVISIONS OF THE RELEVANT FINANCE ACT, 1965, SO FAR AS THE ORDER UNDER REFERENCE WAS CONCERNED. THIS QUESTION IN THE LIGHT OF THIS CIRCULAR OF 1955 HAD NOT BEEN EXAMINED BY THE TRIBU NAL. WHAT APPLIES TO THE OBLIGATION OF THE INCOME-TAX OFFICER WOULD ALSO APPLY TO ALL OFFICERS OF THE DEPARTMENT CONCERNED W ITH THE EXECUTION OF THE I.T. ACT, 1961. THEREFORE SO FAR A S THE CONTROVERSY REGARDING THE POWERS OF THE AA C WAS CO NCERNED, IN THE LIGHT OF THE FACTS AND IN THE LIGHT OF THIS CIR CULAR, THE QUESTION COULD NOT BE ANSWERED. IN SUCH A SITUATION, THE MATTER WAS TO BE SENT BAC K TO THE TRIBUNAL SO THAT IT COULD EXAMINE THE QUESTION WHET HER, IN THE LIGHT OF WHAT WAS DISCLOSED IN THE PROCEEDINGS OR O THER PARTICULARS BEFORE THE INCOME-TAX OFFICER, AT THE T IME OF ORIGINAL ASSESSMENT PROCEEDINGS, THE INCOME-TAX OFFICER CONC ERNED SHOULD HAVE TAKEN THE INITIATIVE IN GUIDING THE ASS ESSEE IN CLAIMING RELIEF UNDER SECTION 2(5)(A)(III ) OF THE RELEVANT FINANCE ACT. ITA NO.350/DEL./2009 8 HE ALSO RELIED ON THE DECISION OF HON'BLE GUJARAT H IGH COURT IN THE CASE OF S.R. KOSHTI, 276 ITR 165 (GUJ.) WHEREIN THE HON'BLE HIGH COURT HAS HELD AS UNDER :- 'THE AUTHORITIES UNDER THE ACT ARE UNDER AN OBLIGAT ION TO ACT IN ACCORDANCE WITH LAW. TAX CAN BE COLLECTED ONLY AS P ROVIDED UNDER THE ACT. IF AN ASSESSEE, UNDER A MISTAKE, MIS CONCEPTION OR ON NOT BEING PROPERLY INSTRUCTED, IS OVER ASSESS ED, THE AUTHORITIES UNDER THE ACT ARE REQUIRED TO ASSIST HI M AND ENSURE THAT ONLY LEGITIMATE TAXES DUE ARE COLLECTED. HE ALSO RELIED ON THE HON'BLE ALLAHABAD HIGH COURT DECISION IN THE CASE OF CIT VS. LUCKNOW PUBLIC EDUCATIONAL SOCIETY, 318 ITR 223 (ALL.) WHEREIN THE HON'BLE HIGH COURT HAS HELD THAT THE ASSESSING OFFI CER HAD NOT ASKED FOR ANY INFORMATION BEFORE DENYING THE EXEMPTION FOR WHICH THE ASSESSEE WAS LEGALLY ENTITLED AND THE ASSESSING OFFICER HAD REJECTED THE SECOND RETURN WHICH WAS ENCLOSED WITH THE NECESSARY DOCUMENTS FOR CLAIMING THE EXEMPTION. THE HON'BLE COURT GRANTED THE RELIEF TO THE ASSESSEE AN D HON'BLE COURT HELD THAT THE EXEMPTION WAS STATUTORY EXEMPTION AVAILABLE TO THE ASSESSEE AND DISMISS THE REVENUES APPEAL. HE FURTHER RELIED ON THE DEC ISION OF ANCHOR PRESSING, 161 ITR 159 (SC) FOR THE PROPOSITION THAT IT IS THE OBLIGATION IMPOSED ON THE INCOME-TAX OFFICER BY THE STATUTE TO GRANT SUCH REL IEF AND THE ASSESSING OFFICER CANNOT REFUSE MERELY BECAUSE THE APPELLANT HAS OMITTED TO CLAIM THE RELIEF. HE ALSO RELIED ON THE FOLLOWING CASE LAWS :- ITA NO.350/DEL./2009 9 (I) MAHALKSHMI SUGAR MILLS, 160 ITR 920 (HON'BLE SUPREM E COURT); (II) SNEHLATA (2004) 192 CTR (J&K HIGH COURT) (III) CENTRAL PROVINCES MANGANESE ORE, 112 ITR 734 (BOM.) (IV) HIRANAND, 148 TAXMAN 281 (RAJASTHAN) (V) VAM ORGANICS, 6 SOT 775 (DELHI ITAT) (VI) GOETZE (INDIA) LTD. VS. CTI (2006) 204 CTR (SC) 182 (VII) ACIT VS. NIKA RESOURCES LTD., (2009) 123 TTJ (AHD.) 310 (VIII) EMERSON NETWORK POWER INDIA (P) LTD. VS. ACIT, (200 9) 122 TTJ (MUMBAI) 67 (IX) ITO VS. HEARTLAND K.G. INFORMATION LTD., (2010) 131 TTJ (CHENNAI) 216 (X) CIT VS. JAI PARABOLIC SPRINTS LTD., 306 ITR 42 (XI) CIT VS. RAMCO INTERNATIONAL, (2009) 190 TAXMAN 584 (XII) CWT VS. KU. RAGINI SANGHI, (2010) 123 ITD 384 (XIII) CIT VS. BHARAT ALUMINIUM CO. LTD., 303 ITR 256 (DEL .) (XIV) CIT VS. SYED MAQBUL HUSSAIN, 4 ITR (TRIB) 44 (CHENN AI) (XV) FRANCO INDIAN PHARMACEUTICALS (P) LTD. VS. ITO, 3 I TR (TRIB) 754 (MUMBAI) (XVI) KISAN DISCRETIONARY FAMILY TRUST VS. ACIT, (2008) 1 13 TTJ (AHD) 918 FINALLY, HE SUBMITTED THAT ITAT DELHI BENCH D ALL OWED THE RELIEF U/S 80IB WHILE DECIDING THE ITA NO.3872/DEL/2009 IN THE ASSE SSEES OWN CASE VIDE ORDER DATED 18.02.2010 WHEREIN THE ITAT HELD AS UND ER :- 5.2 FROM THE ABOVE CASE LAWS, IT IS EVIDENT THAT THE ISSUE INVOLVED IS COVERED IN FAVOUR OF THE ASSESSEE. WE M AY QUOTE THE OBSERVATIONS OF THE TRIBUNALS DECISION IN ITA NO. 5000/DEL/04 DCIT VS. MALLIKARJUN GEORESOURCES ASSOCIATES CITED ABOVE IN IDENTICAL CASE AS UNDER ON WHICH THE LD. CIT(A) HAS ALSO RELIED. ITA NO.350/DEL./2009 10 12. WE, AFTER HAVING GOING THROUGH THE CHART OF PR OCESS OF PRODUCTION PLACED AT PAGE 5/PB ARE OF THE VIEW THAT THIS PROCESS OF PRODUCTION AMOUNTS TO MANUFACTURING INASMUCH AS IN THIS CASE ALSO THE ORIGINAL COMMODITY BOULDERS COULD NOT BE USED FOR BUILDING/ ROAD PURPOSE AS SUCH UNTIL IT IS BROKEN INTO SMALL PIECES I.E, GRITS TO BE USED AS BUILDING/ROAD MATERIAL. IT IS ONLY BY THE PROCESS O F BREAKING THE BOULDERS INTO GRITS THAT IT IS MADE MARKETABLE. THE BOULDERS CANNOT BE USED FOR THE SAME PURPOSE AS THE GRITS CAN BE USED AND AFTER BOULDERS HAVE BEEN BROKEN INTO GRITS, THE END PRODUCT BY PUTTING IT SIMULTANEOUSLY CANNOT BE USED AS A BOULDER. THE BOULDER AS A MINERAL PRODUCED/ EXCAVATED FROM RIVERBED OR BY BLASTING ROCKS BY ITSELF IS NOT USABLE FOR ANY PURPOSE, THEREFORE, TO MAKE IT USABLE, VARIOUS PROCESSES WHICH COULD NOT BE APPLIED TO BRING IT TO THAT STAGE WOULD AMOUNT T O MANUFACTURING. OBVIOUSLY SO FAR AS PHYSICAL CHARACTERISTIC OF BOULDERS AND GRITS MAY HAVE SAME PHYSICAL PROPERTIES I.E., STONE. THUS, KEEPING IN VIEW THE DECISION IN THE CASE OF ARIHANT TILES MARBLES (P) LTD. (SUPRA), KORES INDIA LTD. (SUPRA) AND MYSORE MINERAL LTD. (SUPRA). WE HOLD THAT THE ASSESSEE IS ENGAGED IN THE ACTIVITY OF MANUFACTURE OR PRODUCE OF ARTICLE OR THING AND AS SUCH, ENTITLE TO DEDUCTION U/S 80IB. HENCE, WE UPHOLD THE ORDER PASSED BY THE CIT(A). 13. THE DECISION IN THE CASE OF LUCKY MINERALS (P) LTD. VS. CIT116 TAXMAN 1(SC) RELIED BY THE LD. DR IS DISTINGUISHABLE FROM THE PRESENT CASE. IN THE SAID CASE. HONBLE SUPREME COURT HAS OBSERVED THAT IT HAS NOT BEEN FOUND BY THE TRIBUNAL THAT THE ASSESSEE COMPANY CONVERTED THE BOULDERS INTO POWDER, CHIPS OR ANY OTHER ARTICLE COMMERCIALLY KNOWN BY ANOTHER NAME AND USED AS A DIFFERENT ARTICLE. THUS, THE COURT HELD THAT THE ACTIVITIES CARRIED ON BY THE ASSESSEE COMPANY DID NOT AMOUNT TO MANUFACTURE. SIMILARLY, OTHER DECISIONS RELIED UPON BY THE REVENUE ARE DISTINGUISHABLE ON FACTS. ITA NO.350/DEL./2009 11 7. WE HAVE HEARD BOTH THE SIDES ON THE ISSUE AND AF TER HEARING BOTH THE SIDES, WE ARE OF THE VIEW THAT THIS ISSUE ALSO REQU IRES TO BE CONSIDERED AT THE LEVEL OF ASSESSING OFFICER, THEREFORE, WE RESTORE T HE SAME TO HIS FILE TO BE DECIDED AS PER LAW. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON THIS 25 TH DAY OF OCTOBER, 2011. SD/- SD/- (A.D. JAIN) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 25 TH DAY OF OCTOBER, 2011 TS COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A)-II, DEHRADUN. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.