Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2014 (2) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (2) TMI 605 - HC - Income TaxEntitlement for benefit of Section 80IA of the Act – Manufacture Activity OR not - Assembling the various parts - Whether the air-conditioning system or plant delivered constitute a separate and distinct product involving manufacturing or production and eligible for deduction – Held that:- It has an in-built capacity to manufacture ducting, erection of systems, providing electrical paneling controls, installations etc. – it purchases air conditioners, blowers, freezers, Cooling equipment etc. - The case of the assessee is after purchasing these parts it manufacures an air-conditioning plant and delivers the same to his customers - after these parts are purchased they are transformed into an altogether new product - the assessee is entitled to the benefit as it satisfies the above requirement of the Section. The air-conditioners freezers, blowers which are purchased as raw materials for the said air condition plant are not processed - They are used as it is - No manufacturing activity takes place insofar as those items are concerned - They are installed as it is and only they are connected with these panels and ducting - Though the assessee calls it as an air-conditioning plant, the air-conditioners, which are purchased as raw material continues to perform the very same function after its installation - No new product comes into existence after the assessee purchases these goods - the authorities have called it as assembly and for the purpose of assembly, they may manufacture ducting and electrical panel controls and other installations - But merely because those anciliary goods are manufactured, it does not mean that the assessee is manufacturing air conditioning plant - the authorities were justified in declining to extend the benefit of Section 80IA to the assessee – there was no error committed by the authorities in holding that the assessee is not involved in manufacturing or production and therefore is not entitled to benefit of tax deduction – Decided against Assessee.
|