Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (5) TMI 225 - AT - Income TaxRe opening of assessment - disallowance of exemption u/s 10B - Held that:- It is crystal clear that the assessee was not considered to be a manufacturer and eligible for exemption u/s 10B only on the basis of the judgment of Lucky Minmat Pvt. Ltd. vs CIT (2000 (8) TMI 6 - SUPREME Court). However, AO did not consider this vital fact that conversion of Marble Blocks into slabs and tiles i.e. the activity in which the assessee was engaged was held to be a manufacturing activity in the case of Arihant Tiles & Marbles Pvt. Ltd. vs ITO (2007 (5) TMI 132 - HIGH COURT, RAJASTHAN). In the said judgement, earlier judgment of Hon'ble Supreme Court in the case of Lucky Minmat Pvt. Ltd. vs CIT (supra) was considered, subsequently the Hon'ble Supreme Court affirmed the judgemnt of Hon'ble Rajasthan High Court and held in the case of ITO vs Arihant Tiles and Marbles Pvt. Ltd. (2009 (7) TMI 403 - CESTAT, MUMBAI) that conversion of Marble Blocks into polished slabs and tiles constitutes 'manufacture or production' as it results in emergence of a new and distinct commodity. In the present case, the only basis with the AO for initiating reassessment proceedings was the judgment of Hon'ble Supreme Court in the case of Lucky Minmat Pvt. Ltd. vs CIT (supra) wchich was considered by in the case of Arihant Tiles & Marbles Pvt. Ltd. vs ITO (supra), thereafter it was held that process of cutting and sizing or polishing of Marble Blocks into slabs and tiles which results into making raw marble usable amounts to manufacturing. Therefore, the reopening by the Assessing Officer was not sustainable. Rectification made u/s 154 for the disallowance u/s 40(a)(ia) - Held that:- Credit balance written off were the balances not payable by the company due to various reasons. On the similar issue, the decision of in the case of Wipro Ltd. vs DCIT, (2002 (7) TMI 752 - ITAT BANGALORE) was held in favour of the assessee therefore, it can be said that the issue was highly debatable. Similarly, the applicability on reimbursement of the expense in the case of exporters i.e. Ocean Freight paid and other expenses was highly debatable, therefore, it cannot be said that there was a mistake apparent on record particularly when the AO examined the issue in detail during original assessment proceedings u/s 143(3) and excluded the amount under consideration for determining the disallowance u/s 40(a)(ia) - it can be said that this issue was also debatable issue and it is well settled that rectification u/s 154 cannot be made for the issue which is debatable.
|