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2016 (2) TMI 790 - AT - Income TaxReopening of assessment - Eligibility for deduction u/s 10A - Held that:- The proceedings u/s. 147 and 148 of the Act initiated against the assessee company need to be dropped as the same was not validly initiated and is merely a change of opinion by the AO based upon the audit objections and AO has not independently applied his mind before re-opening the proceedings u/s 147/148 of the Act against the assessee company while there is no failure on the part of the assessee company in truly and fully disclosing all material and relevant facts concerning the Mumbai unit, as the proceedings have been initiated after four years from the end of the relevant assessment year and the proviso to Section 147 of the Act is applicable, the original assessment having being processed u/s. 143(3) of the Act culminating into an assessment order dated 28-11-2008. The assessee company is not hit by the Section 10A(2) of the Act as it could not be said that it is formed by splitting up or reconstruction of business already in existence nor it is brought on records that there is transfer to a new business of machineries or plant previously used for any purpose. The circular no 1 of 2005 issued in context of Section 10B of the Act which is reproduced below supports the stand of the assessee company. Thus, we hold that assessee company is duly entitled for exemption u/s. 10A of the Act and in our considered view, the assessee company has rightly claimed deduction of ₹ 47,13,192/- u/s. 10A of the Act w.e.f. 1st October , 2005 which the assessee company is duly entitled for the said deduction of ₹ 47,13,192/- u/s 10 A of the Act. Hence, we set aside the orders of the CIT(A) and hold that the assessee company is entitled for the deduction of ₹ 47,13,192/- u/s.10A of the Act w.e.f. 1st October, 2005 which has been rightly claimed by the assessee company in the return of income filed with the Revenue - Decided in favour of assessee
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