Royal Impex, Vapi V. The Income tax Officer,Vapi Ward-3, Vapi

ITA 3706/AHD/2008

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 9136 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-12-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 16-12-2010
• Assessment Year: 2005-2006
• Appeal Filed On: 14-11-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR SMT SHALINI VERM A
• Assessee Lawyers: M K PATEL
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : C BENCH : AHMEDABAD (BEFORE HONBLE SHRI T.K. SHARMA, J.M. & HON' BLE SHRI A.N. PAHUJA, A.M. ) I.T.A. NO. 3706/AHD./2008 ASSESSMENT YEAR : 2005-2006 ROYAL IMPEX, SILVASSA -VS.- INCOME TAX OFFICER, VAPI WARD-3, VAPI (PAN : AAEFR 9752 Q) (APPELLANT) (RESP ONDENT) APPELLANT BY : SHRI M.K. PATEL RESPONDENT BY : DR. (SMT.) SHALINI VERM A, SR. D.R. O R D E R PER SHRI T.K. SHARMA, JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE O RDER DATED 14.07.2008 OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS), VALSAD CONFIR MING THE ACTION OF ASSESSING OFFICER TREATING THE ACTIVITIES OF THE ASSESSEE AS A NON-MA NUFACTURING ACTIVITY FOR THE PURPOSE OF GRANTING DEDUCTION UNDER SECTION 80IB OF THE INCOME TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2005-06. 2. WE HAVE HEARD SHRI M.K. PATEL, LD. COUNSEL OF TH E ASSESSEE AND DR. SHALINI VERMA, LD. SR. D.R. APPEARING ON BEHALF OF THE REVENUE. BOTH SIDES CONCEDED THAT THE MATTER IS SQUARELY COVERED BY THE DECISION OF ITAT, C BENCH, AHMEDAB AD FOR THE ASSESSMENT YEARS 2003-04 AND 2004-05. ITAT, C BENCH, AHMEDABAD IN ASSESSEES O WN CASE FOR THE ASSESSMENT YEAR 2003-04 IN ORDER DATED 12.02.2010 IN ITA NO. 1207/AHD/2007 FOLLOWING THE LATEST JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF ITO VS.- ARIH ANT TILES AND MARBLES P. LTD. REPORTED IN (2010) 320 ITR 79 (SC) HELD THAT THE ASSESSEE IS AN INDUSTRIAL UNDERTAKING ENGAGED IN MANUFACTURE AND PRODUCTION OF ARTICLE OR THINGS. TH E RELEVANT DISCUSSION IS CONTAINED IN PARA 5 ON PAGES 2-3 READS AS UNDER :- 5. WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF AUT HORITIES BELOW. THE VARIOUS ACTIVITIES CARRIED OUT BY THE ASSESSEE ARE ALMOST IDENTICAL WHICH ARE CARRIED OUT BY THE DECISION OF HON'BLE SUPREME COUR T IN THE CASE OF ARIHANT TILES AND MARBLES P. LTD. (SUPRA). WE ARE, THEREFORE, OF THE VIEW THAT THE ASSESSEE IS AN INDUSTRIAL UNDERTAKING ENGAGED IN THE BUSINESS OF M ANUFACTURE AND PRODUCTION OF ARTICLE OR THINGS. THE BUSINESS OF ASSESSEE RELA TES TO CUTTING AND POLISHING OF MARBLE STONE AS ALSO MENTIONED BY THE A.O. IN THE A SSESSMENT ORDER. THE ASSESSEE PROCURES ROUGH MARBLE BLOCKS, WHICH IS FIRST CUT OR CHISELED USING A HAMMER AND A CHISEL. THEREAFTER THE BLOCK IS CUT INTO THE FORM OF SLABS. THEREAFTER, THESE SLABS 2 ITA NO. 3706-AHD-2008 ARE PLACED UNDER A POLISHING MACHINE TO MAKE THE SU RFACES SMOOTH. THEN EDGES OF THE TILES ARE CUT USING CIRCULAR SAW BLADES, THE REFORE, FOR THIS PURPOSE THE ASSESSEE IS ENTITLED TO DEDUCTION UNDER SECTION 80I B OF THE ACT. HOWEVER, THE WORKING OF CALCULATION NEEDS VERIFICATION AT THE EN D OF A.O. THEREFORE, THE MATTER IS RESTORED TO THE FILE OF A.O. WITH THE DIRECTION THAT HE WILL VERIFY THE WORKING AND ALLOW THE DEDUCTION UNDER SECTION 80IB TO THE ASSES SEE IN ACCORDANCE WITH LAW. IN THE ASSESSMENT YEAR 2004-05 ALSO, ITAT, C BENC H, AHMEDABAD HAS HELD THAT THE ASSESSEE IS ENTITLED TO DEDUCTION UNDER SECTION 80IB IN ORDER D ATED 11.06.2010 IN ASSESSEES OWN CASE IN ITA NO. 2971/AHD/2007 FOLLOWING THE DECISION OF TRIBUNA L IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2003-04 (SUPRA). HOWEVER, IN BOTH T HE ORDERS, TRIBUNAL HAS MENTIONED THAT CALCULATION OF DEDUCTION UNDER SECTION 80IB NEEDS V ERIFICATION AT THE END OF ASSESSING OFFICER. 3. WE, THEREFORE, FOLLOWING THE DECISION OF THE TRI BUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEARS 2003-04 & 2004-05 (SUPRA) HOLD THA T THE ACTIVITY CARRIED OUT BY THE ASSESSEE IS MANUFACTURING AND AS SUCH THE ASSESSEE IS ENTITLED TO DEDUCTION UNDER SECTION 80IB OF THE ACT. HOWEVER, THE WORKING OF CALCULATION NEEDS VERIFICAT ION AT THE END OF ASSESSING OFFICER, THEREFORE, THE MATTER IS RESTORED TO THE FILE OF AS SESSING OFFICER WITH THE DIRECTION THAT HE WILL VERIFY THE WORKING OF CALCULATION AND WILL ALLOW TH E DEDUCTION UNDER SECTION 80IB OF THE ACT TO THE ASSESSEE IN ACCORDANCE WITH LAW. 4. IN THE RESULT, FOR STATISTICAL PURPOSES, THE APP EAL FILED BY THE ASSESSEE IS TREATED AS ALLOWED. THE ORDER WAS PRONOUNCED IN THE COURT ON 16.12.20 10 SD/- SD/- (A.N. PAHUJA) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 16 / 12 / 2010 COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE (2) THE DEPARTMENT. 3) CIT(A.) CONCERNED, (4) CIT CONCERNED, (5) D.R. , ITAT, AHMEDABAD. TRUE COPY BY ORDER DEPUTY REG ISTRAR, ITAT, AHMEDABAD LAHA/SR.P.S.