TMI Blog2005 (1) TMI 589X X X X Extracts X X X X X X X X Extracts X X X X ..... er section 80HHC was allowed to the assessee and that thereby income chargeable to tax was under assessed. The Assessing Officer was of the view that minerals exported was not processed and accordingly, no deduction under section 80HHC was allowable. 3. The ld. AR submitted that after the Tax Laws (Amendment) Act, 1987 in a large number of cases it had been held that the reassessment proceedings on the basis of change of opinion are ab inito void . He relied upon the following cases laws: 1. CWT v. Kedar Nath [2003] 259 ITR 563 (Raj.) 2. CIT v. Kelvinator of India Ltd. [2002] 256 ITR 1 (Delhi) (FB) 3. CIT v. Foramer France [2003] 129 Taxman 72 (SC) 4. The ld. DR relied upon the order of the ld. CIT(A) and submitted that for the first order dated 7-3-1994, the Assessing Officer had allowed the claim with remarks "deduction under section 80HHC as per audit report". This means that the Assessing Officer had not applied his mind to the facts and he has not found any opinion. He also submitted that this case will not fall under the proviso of section 147 of the Act as the assessment had been reopened with the limit of 4 years. For this purpose, he relied upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of assessment proceedings. In this connection, it is relevant to add that as per clause (1) of the Twelfth Schedule to the Income Tax Act, soapstone powder which is also named as pulverized talc is one and the same thing and thus deduction under section 80HHC was rightly claimed and also rightly allowed by the Assessing Officer. The Photostat copy of Twelfth Schedule is placed before the Hon ble Bench for kind perusal. The ld.CIT(A) in para 5 of his appellate order dated 1-10-1996 had stated that mineral talc can be said to be processed, if it is pulverized or micronized" 8. The ld.DR relied upon the orders of the lower authorities and also relied upon the order of the ld.CIT(A) for the assessment year 1992-93. 9. We have heard the rival submissions and perused the materials available on record. In this case the Assessing Officer had not accepted the claim of the assessee for the reason that mineral talc can be said to be processed if it is pulverized or micronized. The Explanation to the Schedule XIIth for the word processed even if considered applicable to talc, also does not fit in any of the categories from ( a ) to ( h ). The vital ingredients of ( b ) ( f ) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... process and thereafter the same were grinded resulting in the production of soapstone powder. Therefore, our case falls within the purview of item ( iv ) of the Twelfth Schedule and the ld.Assessing Officer, after examining the issue rightly allowed our claim under section 80HHC, the question of withdrawing the same does not arise." 11. It is clear from the explanation of assessee dated 6-11-1996 before the ld. CIT(A) that it had relied upon the provisions of item ( iv ) of the Twelfth Schedule for deduction under section 80HHC. We find that for not accepting the claim of the assessee, the ld. CIT (A) has given detailed reasons for the assessment year 1992-93 in his order dated 29-3-1996 in appeal No. 5/95-96 in paras 1.20 to 1.27 from pages 27-34. The ld. CIT(A) held at page 27 of his order for assessment year 1992-93 that talc is synonyms of soap powder and that Item No. ( i ) of Twelfth Schedule alone is applicable in this case. This issue has been dealt with at length by dealing with issue Nos. 1 and 2. 12. We agree with the reasons given by the ld.CIT(A). However, the claim raised in this issue was also discussed to show that assessee has no case in Item No. ( iv ) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt increases. Therefore, the vital requirement of the process (f) of the Explanation to the Twelfth Schedule was not met and satisfied by the appellant. Now coming to another process of mechanical screening it is seen that there is no whisper about it in the letter of the appellant dated 16-12-1994 filed before the DCIT ( see para 1.23 Page 29 ante). The mention of the word screening was made by the appellant for the first time during the appellate proceedings vide para 1.6 ( ix ) in its aforesaid letter dated 21-7-1995 reproduced in para 1.4 in page 8. The photograph No. 12 relied upon by the appellant shows that the labourers are putting manually lumps of talc on iron screen to segregate the ruffa . It is clear from this photograph that the screening was done manually by both the suppliers of the appellant. This fact was brought to the notice of the appellant by the ld.CIT(A). It was argued on behalf of the appellant that word mechanical used in process ( f ) of the said Explanation does not qualify the word screening . It was argued that the said process ( f ) should be read to have two separate limbs independent of each other, viz. first the beneficiation by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the processed lumps of talc. However, the appellant in its detailed letter dated 21-7-1995, made a reference of mechanical crushing and manual screening. Further, it was conceded that a part of the cutting was also done manually. Thus, a part of mineral and ore was exported even without passing through the process ( f ) of the Explanation. The appellant had very seriously and diligently argued before ld. CIT(A) that the word mechanical did not qualify the word screening in the said process ( f ). It would not have submitted such an argument had the screening of talc , if any, was really done mechanically by its suppliers during the relevant period. The appellant, after realizing that its argument has no force and not acceptable, sought to change the basic facts of its case. The case of the appellant is rejected because it is not in consonance with the facts it had stated earlier before the DCIT and in these appellate proceedings before the ld.CIT(A). To sum up, the claim of the appellant that it had beneficiated the ore of talc by mechanical crushing and screening was also rightly rejected by the ld.CIT(A). It is held that the mineral and ore exported by the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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