Standard Tea Processing Co. Ltd. V. The Dy. Commissioner of Income Tax (Asst)

TAXAP/987/2007

AI Insights

The case involves Standard Tea Processing Co. Ltd., the appellant, challenging the judgment and order dated 1.12.2006 passed by the Income Tax Appellate Tribunal in ITA No. 2674/Ahd/2002 for the assessment year 1993-94. The primary legal question was whether the process of blending tea produces an article or thing within the meaning of section 80I of the Income-tax Act, 1961, thereby creating a different commercial commodity. The appellant had filed a return of income declaring a total income of Rs. 72,16,560/- and sought deductions under section 80I, which were not granted. The matter progressed through various levels of tax assessment and appeals, ultimately reaching the High Court of Gujarat.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 687563 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 26-11-2014
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income-tax vs. Tara Agencies, reported in 292 ITR 444
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: M M BHATT
• Assessee Lawyers: MANISH SHAH
• Keywords: Assessment Order; Commercial Commodity; Income Declaration; Income Tax; Blending Tea
• Section: 142(1); 143(2); 143(1)(a); 80I

Judgement Text

"O/TAXAP/987/2007 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 987 of 2007 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ STANDARD TEA PROCESSING CO. LTD.....Appellant(s) Versus THE DY. COMMISSIONER OF INCOMETAX (ASST)....Opponent(s) ================================================================ Appearance: MR MANISH J SHAH, ADVOCATE for the Appellant(s) No. 1 MR MM BHATT for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER Page 1 of 3 O/TAXAP/987/2007 JUDGMENT Date : 26/11/2014 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. By way of this appeal, the appellant has challenged the judgment and order dated 1.12.2006 passed by Income Tax Appellate Tribunal in ITA No. 2674/Ahd/2002for AY 1993-94. 2. While admitting this appeal on 17.12.2007, this Court has framed the following substantial question of law: “Whether the process of blending tea can be said to produce an article or thing within the meaning of section 80I of the Income-tax Act, 1961 so as to bring into existence an article or thing which is a different commercial commodity ?” 3. The facts of the present appeal are that the assessee has filed return of income declaring total income of Rs. 72,16,560/- on 29.12.1993. The return of income has been accompanied with copies of audited accounts, auditor’s report under sec. 44AB and other statements and copies of accounts. The return was processed u/s. 143(1) (a) on 6.9.1994 on the returned income and raising NIL demand. In response to notices u/s. 143(2) and 142(1) of the IT Act, 1961 the assesee has submitted required details. Thereafter, Page 2 of 3 O/TAXAP/987/2007 JUDGMENT after considering the material on record, the assessment orders came to be passed. The said assessment order has been challenged before the CIT(A) which was partly allowed. Against the order of CIT(A), the assessee has preferred an appeal before the Income Tax Appellate Tribunal, which came to be dismissed. 4. Being aggrieved and dissatisfied with the order passed by the Tribunal in the above appeal, the assessee has preferred the present Tax Appeal before this Court. 5. Heard the learned advocates appearing for the parties and considered the submissions. Mr. Bhatt learned advocate appearing for the respondent has pointed out that the issue is governed by the decision of the Apex Court in the case of Commissioner of Income-tax vs. Tara Agencies, reported in 292 ITR 444, which was not disputed by the learned advocate for the appellant. In view of the said decision of the Apex Court, without giving any elaborate reasons, the question is answered in favour of the Revenue and against the assessee. The present Tax Appeal is dismissed. (K.S.JHAVERI, J.) (K.J.THAKER, J) mandora Page 3 of 3 "