TMI Blog2011 (7) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... tivity would be producing grits/stone chips/powder, the same would be production - Decided in favour of the assessee - 33 of 2009 - - - Dated:- 7-7-2011 - Barin Ghosh, Servesh Kumar Gupta, JJ. Mr. Arvind Vashistha, Standing Counsel, for the appellant. Mr. Rajendra Dobhal, Sr. Advocate, assisted by Mr. A.K. Joshi, Advocate, for the respondent. JUDGMENT BARIN GHOSH, C.J. (ORAL) The case of the assessee, for the assessment year concerned, was concluded by an assessment order after issuing notices under Section 143(2)/142(1) of the Income Tax Act, 1961. The assessee is engaged in mining activity, in course whereof, it procures from riverbeds or by blasting, boulders from earmarked mining areas leased out to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, are manufacturing activities. The Department thereupon went before the Tribunal, who concluded the matter by relying upon, amongst others, the judgment of the High Court rendered in the case of Arihant Tiles and Marbles (P) Ltd. It held that the boulders cannot be used for the same purpose as the grits can be used and after boulders have been broken into grits, the end product, by putting it simultaneously, cannot be used as boulders. 3. Aggrieved by the decision of the Tribunal, the Revenue is before us in the appeal. In the appeal, the question is whether in the facts and circumstances of the case, the assessee was engaged in manufacturing and processing of articles or things, so as to be entitled to deduction under Section 80IB of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , pronounced that even if the action of manufacturing may not produce new goods, but if the activity entails production of a by-product or intermediate produce or residual product, the same will be production. Applying the said test, the Hon ble Supreme Court pronounced that excavation of marble blocks, squaring them up, sawing them for making slabs, filling up cracks, polishing the same and later on, for the purpose of getting a shine, buffing the same, would tantamount to production within the meaning of Section 80-IB of the Act. 6. In the instant case, boulder, which is a stone, would remain a stone even after it is crushed and converted into grits/stone chips/powder. The activity of converting boulder into grits/stone chips/powder m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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