TaxTMI 
TaxTMI 
2012 (12) TMI 666
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....the respondent has re-framed the following questions of law for the consideration by this court: a) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in allowing deduction u/s.80JJA of the Income Tax Act on the profits derived from the business of manufacturing fuel briquettes from bagasse? b) Whether on the facts and in the circumstances of the case and in law, the Tribunal was correct in not appreciating that bagasse is not a waste but is a by product of sugar industry and is a basic raw material for many industrial products apart from being used as fuel by the sugar industry to run boilers? 3) The brief facts leading to this appeal are as under: &nbs....
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....7 allowed the respondent's appeal in respect of its claim for deduction under Section 80JJA of the Act. The Commissioner of Income Tax(Appeals) in both the above orders held that bagasse was purchased from sugar factories and processed by it for making briquettes to be used as fuel. It was further held that the respondent assessee was engaged in the business of collecting and processing/treating biodegradable waste. Further it was held that all the conditions laid down in Section 80JJA of the Act were satisfied and the respondent-assessee was entitled to claim a deduction there under. d) Being aggrieved by the order of Commissioner of Income Tax (appeals) dated 2/5/2007 and 7/6/2007 for the assessment years 2003-04 and 2....
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....re, Section 80JJA of the Act could have no application in this case; b) Reliance is placed upon a circular No.772 dated 27/12/1998 issued by the Central Board of Director Taxes explaining the intention to insert Section 80 JJA of the Act to support his contention. According to him section 80JJA of the Act was introduced so as to encourage local bodies to manage waste arising in Urban areas. Thus the benefit of Section 80JJA of the Act is not available to persons other than local bodies; c) Bagasse is not collected by the respondent assessee but is purchased from the sugar factories. Therefore, the pre-requisite for claiming deduction under Section 80JJA of the Act is not satisfied. In view of the abo....
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....r of Income Tax (appeals) as well as Tribunal have reached a finding of fact that bagasse is a biodegradable waste used for making briquettes for fuel by the respondent assessee. This finding of fact was based on evidence led before the authorities by the respondentassessee. We find that bagasse is a waste of the sugar factory. This waste is a bio-degradeable waste and the same is collected on consideration by the respondent assessee from the factory. There could be no universal definition of the word "waste". The term waste has to be understood contextually i.e. place where it arises and the manner in which it arises during the processing of some article. The fact that sugar industry also regards Bagasse as waste is evident from Circular d....