Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Asst. Commissioner of Income-tax, Circle – 16 (2) , Hyderabad Versus Midwest Granites Pvt. Ltd.

2016 (4) TMI 341 - ITAT HYDERABAD

Disallowance of claim of deduction u/s 10B - eligibility of additional depreciation - Held that:- As the business of the assessee is proved beyond doubt that it involves in the manufacturing activities, in the result, it is eligible to claim deduction u/s 10B as well as it is eligible to claim additional depreciation, as the same was eligible to be claimed by those assessee's who are in the business of manufacture or production of any article or thing. Hence, in our opinion, the assessee is elig .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

2010-11 and 2011-12. As identical issues are involved in both these appeals, they were clubbed and heard together, therefore, a common order is passed for the sake of convenience. 2 . To dispose of these appeals, we refer to the facts involved in AY 2010-11 being ITA No. 236/Hyd/2014. 3. Briefly the facts of the case are that the assessee filed the return of income for the AY 2010-11 on 30/09/2010 declaring a total income of ₹ 4,99,57,490/- under the normal provisions and book profits of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ocessing of granite block is not a manufacturing activity as mere extracting and cutting of granite will not constitute manufacturing and also opined that the assessee company do not have leased quarry on the date of granting of 100% EOU permission on 08/09/2006. The AO also mentioned that the quarry leased to the assessee company was earlier awarded to Victorian Granite Pvt. Ltd. which is sister concern of the assessee company. Therefore, the AO held that the business of the assessee company sa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s engaged in the business of manufacturing and therefore is subject to levy of excise duty. It was further submitted that in the absence of any specific finding given on the nature of the granite blocks exported, it was not correct on the part of the AO to come to the conclusion that the assessee has partly exported rough/dressed granite blocks and partly cut granite slabs and that it does not tantamount to manufacture or production. 6. After considering the submissions of the assessee, the CIT( .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

g that the assessee is eligible for exemption u/s 10B of the Act. 3. The ld. CIT(A) should have appreciated that the granite block which is cut from the larger formation continues to remain granite only and the fact labour and skill required to remove the block from the larger mass and transporting the same, cannot be regarded as either manufacturing or production. 8. Ld. DR relied upon the order of the AO and submitted that ld. CIT(A) should have appreciated that the granite block which is cut .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ITA Nos. 666/Hyd/10 and others, order dated 28/12/2012. 2. Madhucon Granites Ltd. in ITA No. 1908/Hyd/14 and others, order dated 22/01/2016. 10. We have heard the rival submissions and perused the material facts on record as well as the orders of revenue authorities. We have also carefully gone through the orders of the coordinate bench in the case of Madhucon Granites Ltd. We find that the issue is squarely covered by the decision of the coordinate bench in the said case wherein the coordinate .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

chedule of Income-tax Act, 1961. On the reason that it was mentioned in the director's report that the Assessee has exported only rough blocks of granite, according to the Department the Assessee is not entitled for deduction u/s. 80HHC of the Act. It is also submitted before us by the DR that the Assessee has described in the sales invoices rough granite. However, it was clarified by the Assessee that granite has been processed into blocks and dressed by the Assessee and which was subjected .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

be and it has to be concluded that the Assessee is engaged in "production". In similar circumstances, the Bombay High Court in the case of CIT vs. Fateh Granites Pvt. Ld. (314 ITR 32) (Bom) held that the activity of cutting, polishing and sizing of granites would be covered within the meaning of expression "production". Therefore, the Assessee is entitled to the benefit u/s. 80HHC/ l0B of the Act. Further, the Chennai Bench of this Tribunal in the case of ACIT vs. M/s. .Jana .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ite has not been polished. Being so, the Assessee is entitled for deduction u/s. 80HHC/ l0B of the Act on similar lines for the A.Ys. 2000-01 to 2004-05. Accordingly, the Revenue appeals in ITA No. 29 to 33/Hyd/2012 are dismissed. 8. For the assessment year 2006-07 in ITA No. 35/Hyd/12, the issue is relating to allowability of deduction u/s. l0B of the Act which is decided on similar lines as above as discussed in the above, the Revenue appeal is dismissed . 9. In view of the above, we are of th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

mends in the order for AY. 2011- 12 and allowed the deduction in all the granite blocks being exported by Assessee, subject to examination of eligibility of Ongole unit. This unit is also established much earlier and Assessee was allowed deduction on this unit also upto AY. 2006-07. Consequently, the direction of the CIT(A) asking the AO to examine the eligibility of Ongole unit is superfluous. Therefore, allowing Assessee s ground on this issue, we direct the AO to allow the deduction of Ongole .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ation of ₹ 89,51,641/-, the AO observed that the additional depreciation of ₹ 89,51,641//- claimed by the assessee u/s 32(1)(iia) on plant and machinery, mining equipment etc. are not eligible since the assessee is not involved in the business of manufacture or production of an article or thing. He opined that the additional depreciation was to be allowed for an assessee who is engaged in the business of manufacture or production of any article or thing. As he held that assessee is n .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     bird's eye view     ↓  


|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version