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2005 (7) TMI 607 - AT - Income TaxExemption u/s 10A - The process of fixing size labels, buttons checking, ironing and packing for making the garments amounted to Manufacturing process undertaken by the assessee Or Not - Export of readymade garments - HELD THAT:- We find that the Circulars by Ministry of Finance relied by the assessee clearly strengthen the contention of the assessee as vide the above Circular No. 314/20/97-CX. It has been clarified that even galvanizing of black MS Pipes tantamount to manufacturing activity. CBDT Circular 495 relied by the assessee also says that unit merely assemble or process goods for exports would also get the benefit of the tax holidays. We find that the observation of the Assessing Officer that the assessee-company was not involved in manufacturing process to enable it to claim deduction u/s 10A was not correct as the above Circular of Board, Ministry of Finance, decision of Metro Readywear Co. [1976 (7) TMI 62 - HIGH COURT OF KERALA AT ERNAKULAM] and the licence granted by the Development Commissioner clearly indicate that the above stitching of buttons, ironing, labelling, etc. done by the assessee on the garments received by it from M/s. Arihant Garments was to be reckoned as manufacturing process against which the claim u/s 10A was justifiable and, hence, the ld. CIT(A) was justified in directing the Assessing Officer to allow the claim of the assessee under section 10A. We, therefore, are of the opinion that the ld. CIT(A), while adjudicating the appeal before him, has passed a well reasoned and discussed order which does not call for any inference from our side and accordingly uphold the same and reject the ground raised by the revenue. In the result, the appeal filed by the revenue is dismissed.
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