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2012 (5) TMI 309 - AT - Income TaxReopening - Exemption under s. 10B - reconstruction of old unit - requirement of plant and machinery - only needles and scissors are required for cutting, finishing and packing. - held that:- In the present case, there had been no business in the old unit of the assessee for over five years before the start of production by the new EOU - it is seen that for eligibility for deduction under s. 10B of the Act, it is nowhere the requirement of the section that plant and machinery must be used for manufacture or production of goods or articles - s. 10B of the Act is a provision directed towards encouraging industrialization by permitting an assessee to set up a new industrial undertaking to claim relief from tax to the extent prescribed The next objection of the Department is that the assessee has utilized the infrastructure of its sister concern - assessee has maintained that the opening stock of raw materials lying with the company was very old and obsolete and was of no use to the new EOU of the company; and that such stock was also actually never used in the business of the new undertaking - The process carried on by the assessee, as such, definitely amounts to manufacture - held that the learned CIT(A) has gone wrong in sustaining the non-allowance of the exemption claimed by the assessee under s. 10B of the Act, with regard to the assessee's new EOU - Decided in favor of the assessee
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