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2012 (8) TMI 673 - ITAT, CHENNAIValidity of reopening of assessment on ground of inadmissible deduction u/s 80IB – assessee being industrial undertaking manufacturing embroidery material and doing job work of embroidery garments, claimed deduction u/s 80IB in its return, assessment of which had been completed u/s 143(3) - assessee contended change of opinion – Held that:- It is undisputed that AO had accepted the claim and the amount has been mentioned clearly in the computation form signed by the AO and appended to the original assessment order. Also, prior to the completion of original assessment on 16.5.2006, there was a proceeding initiated u/s 154 on 17.5.2006. On the face of such facts, it is difficult to believe that the AO had not formed any opinion regarding the claim of Section 80-IB deduction when he was framing the original assessment. Opinion was certainly formed though not expressed. Reopening hence not justified. On merits it is held that it is an admitted position that assessee was doing embroidery work on cloth. There is a processing which has been done on cloth when embroidery work is done. It is not a question of simple value addition. Not only has the original raw material undergone a qualitative change but in the process a number of materials have been used. The process cannot be reversed to obtain the original material back. Hence, assessee was indeed engaged in manufacturing activity and eligible for deduction u/s 80-IB – Decided against Revenue.
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