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2012 (11) TMI 426 - AT - Income TaxExemption u/s 10B - Revision u/s 263 - denial of claim as activity of producing plants through tissue culture does not amount to manufacturing - Held that:- There is no specific definition of word "manufacture or produce" u/s 10B, thus that definition of 'manufacture' contained in the corresponding provisions of section 10AA would also apply qua the assessee's case vis-a-viz its manufacturing activity. The modern day technology of tissue culture is a multifaceted activity with the help of latest biotechnological tools, wherein from one mother plant the manufacturer/producer can get thousands of plant within a short span of time, with limited space and minimum other requirements. The definition of 'manufacture' as per Section 2(r) of the SEZ Act, 2005 is incorporated in Section 10AA of the Income-tax act with effect from 10.02.2006. We conclude, in the light thereof, that the assessee's business activity of tissue culture is 'manufacture or produces' within the meaning of section 10B(2)(i) of the "Act" and Commissioner of Income Tax had wrongly held that since assessee's produce is "plant", which is a lively object, therefore, it is covered by section 2(29)BA). Assessing Officer in finalizing the assessment had rightly granted the assessee deduction under section 10B of the "Act". It was one of the 'possible view' as per law, which could not be revised by CIT under section 263 of the Act. Consequently, once we have held that the assessee's unit is entitled to be treated to be a qualifying unit under the provision of section 10B(2)(1) of the "Act", our conclusion is that the order of the Commissioner of Income Tax revising the assessment does not withstand the test of the law. - Decided in favor of assessee.
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