TMI Blog2021 (4) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... iate the same, nevertheless, the survey conducted under Section 133(a) of the Act, indicates that there were more than 10 employees employed during the Assessment Year 2004-2005, even though not all the employees worked right through the period. There is the substantial compliance of the conditions by the petitioner. Therefore, the invocation of Section 148 of the Act is without any merits. There was no justification in re-opening of the assessment for the Assessment Year 2004-2005. Similarly, for the Assessment Year 2005-2006 also the tabulation in the impugned order indicates that there were more than 10 employees employed by the petitioner though not all of them worked right through the month. There are months which indicates that there was no production. Nevertheless, there are indications in the table that more than 10 employees were employed. That apart, at the time of passing of original assessment order on 31.12.2010, the issue regarding the number of workers employed by the petitioner was considered by the Assessing Officer. Re-opening of the assessment for the Assessment Year 2005-2006 is not sustainable. Assessment Year 2006-2007 - The tabulations indicates that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 011, all the three Assessment Orders dated 31.12.2010 were set aside with a direction to the respondent (Assistant Commissioner of Income Tax) to consider the objections raised by the petitioner and to pass separate speaking orders for the respective Assessment Years. 4. It is pursuant to the aforesaid order dated 21.03.2011 in W.P.Nos.2583 to 2585 of 2011, the impugned speaking orders has been issued to the petitioner, which is now been challenged along with two notices dated 09.03.2010 issued for the Assessment Years 2005-2006 and 2006-2007 and impugned notice dated 16.03.2010 for the Assessment Year 2004-2005 issued under Section 148 of the Income Tax Act, 1961 (hereinafter referred to as the Act). 5. These notices and the impugned composite communication dated 11.07.2011 for all the three assessment years are sought to be challenged in these writ petitions primarily on the ground that as far as the Assessment Year 2004-2005 is concerned, the assessment order was passed under Section 143(3) of the Act, on 29.12.2006 which considered the claim of the petitioner for exemption under Section 80IB of the Income Tax Act, 1961 and therefore there is no case made out for invoking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er this register, following are the number of workers engaged, total amount of wages paid to them, number of women workers, number of workers who worked less than 20 days in a month and number of workers who worked less than 15 days in that month . 10. Thus, the stand taken earlier that the activity do not amounting to manufacture was given up once the issue had attained finality at the primary/tribunal stage and later affirmed by the Tribunal. It is further submitted that the exemption under Section 80IB of the Act, the sub-clause 2(iv) of the Act has been satisfied inasmuch as the impugned speaking order dated 11.07.2011 itself admits that out of four processes involved in the manufacturing process, one of the process, namely 'holes notching' was with the aid of power. Therefore, as long as power was used in the manufacture of the final outcome, the number of employees required for claiming deduction under Section 80IB of the Act stood satisfied as during each of the assessment years, more than 10 workers were employed. It is therefore submitted that these orders/notices seeking to re-opening of assessment were liable to be quashed. 11. Defending the impugned or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned communication overruled the objections of the petitioner. The issue that arises for consideration in these writ petitions is whether reopening of the assessment falls with the four corners of law settled on this aspect by the Hon'ble Supreme Court. 16. The petitioner has claimed benefit of exemption under Section 80IB of the Act. Sub-clause 2 to Section 80IB specifies four conditions for an assessee to claim deduction under the aforesaid provision. Condition No.4 stipulates that in a case where the industrial undertaking manufactures or produces articles or things and employs 10 or more workers in a manufacturing process carried on without the aid of power, or employs 20 or more workers in a manufacturing process carrying on with the aid of power can claim the benefit of deduction under Section 80IB of the Act. The assessee has to satisfy all the four requirements and not one of the requirement. 17. Admittedly, in this case, the manufacturing activity was carried out as it is evident from the reading of the impugned order that it was with the aid of power inasmuch as one of the process namely 'holes notching' was with the aid of power. Therefore, the only r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2007 is concerned. 23. It is therefore for the petitioner to satisfy before the officers namely the respondent that it was indeed eligible for deduction under Section 80IB of the Act, for the Assessment Year 2006-2007 with sufficient records. Therefore, the writ petition as far as the Assessment Year 2006-2007 is concerned is dismissed. 24. The petitioner is therefore directed to participate in the proceedings before the respondent. Though certain observations have been made in this order touching on the merits for the Assessment Year 2006-2007, the respondent is directed to refrain from referring to the same while passing the order on merits as the observations are merely come to a conclusion that the petitioner has not made out a case for interference at this stage. 25. Therefore, Assessment Order for the Assessment Year 2006-2007 has to be passed independently on merits in accordance with law. In fine, W.P.No.17609 of 2011 and 17610 of 2011 for the Assessment Year 2004-2005 and 2005-2006 is allowed. W.P.No.17611 of 2011 filed for the Assessment Year 2006-2007 stands dismissed with the above observations. No costs. Consequently, connected miscellaneous petitions are clo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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