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2022 (9) TMI 1040 - Income Tax
Benefit u/s 80IC - substantial expansion - revenue’s contention is that the assessee having not undertaken any substantial expansion as required under Section 80IC(2)(b) of the Act, they cannot claim exemption u/s 80IC - HELD THAT:- Sub-Section (2) of Section 80IC deals with the undertakings and enterprises to which Section 80IC would apply. Clause (b) of sub-Section (2) of Section 80IC would be relevant to the cases on hand. The said clause (b) of Section 80IC(2) applies to any undertaking or enterprise which has begun or begins to manufacture or produce any article or thing specified in the Fourteenth Schedule or commences any operation specified in that Schedule.
The second category of undertakings are those which manufactures or produces any article or thing in the Fourth Schedule; and the third category being undertakings or enterprises which commenced operations specified in the Fourteenth Schedule and undertakes substantial expansion during the relevant period which is on 24th day of December, 1997 and ending before 1st day of April, 2007 in any North-Eastern States.
On a reading of the order passed by the assessing officer we find that the assessing officer has missed out one of the categories which have been mentioned in Clause (b) of Section 80IC(2). The assessee would squarely fall within the category of undertakings or enterprises which manufactures or produces any article or thing as specified in the Fourteenth Schedule as the assessee is a mineral based industry which finds place in clause-16 of Part-A of the Fourteenth Schedule.
Thus, we are the of the view that the learned tribunal rightly affirmed the conclusion arrived at by the CIT(A). In the result, the appeal filed by the revenue is dismissed and substantial question of law which was common in all the three appeals is answered against the revenue.
Addition u/s 14A r.w.r. 8D - Necessity of recording satisfaction - HELD THAT:- The explanation submitted by the assessee while framing the assessment proceedings was rejected by the assessing officer without adducing any reasons nor any defect was pointed out by the assessing officer at the time of assessment and straightway the assessing officer applied the machinery provision under Rule 8D of the Income Tax Rules, 1962. Furthermore, on facts, the learned tribunal found that the assessee had sufficient funds and an inference can be drawn that the investment has been made out from the funds of the assessee. In the case of Kesoram Industries Ltd. [2022 (1) TMI 995 - CALCUTTA HIGH COURT] the Court took into consideration the decision of the Hon’ble Supreme Court in Maxopp Investment Ltd. vs. CIT [2018 (3) TMI 805 - SUPREME COURT]
The decision of the Hon’ble Supreme Court in South Indian Bank Ltd. vs. Commissioner of Income Tax [2021 (9) TMI 566 - SUPREME COURT] is also in aid of the case of the assessee as the tribunal has recorded specific finding that own funds were available with the assessee - Decided in favour of assessee.