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TMI Blog2013 (8) TMI 1028X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,58,338/- as deduction u/s. 8OIC of the I.T. Act, 1961 considering the assessee's business activity as manufacturing instead of assembling Luggage carriers, Wheel caps etc. II. The appellant prays that the order of the CIT(Appeals) on the above grounds be set aside and that of the AO be restored. Ill. The appellant craves leave to amend or alter any ground or to submit additional new ground which may be necessary. Grounds of Appeal for A.Y.2009-10 The CIT(A) has erred in law and in circumstances of the case and in allowing Rs. 1,59,40,255/- as deduction u/s. 8OIC of the I.T. Act, 1961 considering the assessee's business activity as manufacturing instead of assembling of accessories, namely Luggage carriers, Wheel caps etc. &n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... type of products for giving desired shape to S.S.pipes in front guard and rear guards. M.S.Pipes/Patta are cut and bent on Power Press Machine. c) Grinding : Some types of raw material such as M.S.Profiles, M.S.Brackets etc requires further processing i.e. grinding involves removing roughness from corner edge of brackets/profiles by hand grinder machines. d) Holing : This process involves drilling of holes at specified places on the rew materials like M.S/S.S./Aluminium as per the design structure. These holes are drilled using power press for the purpose of fitment of brackets/screws for being fastened with the accessories of the vehicle such as bumper. door, chassis of the car etc. e) Welding : This process involves welding of the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the semi finished product is received from polishing, the final assembly is undertaken for the purpose of finishing the process. This involves assembly of different components such as rubber parts, plastic parts, monogram etc to the polished frame of the final product. H) Cleaning/packing : After final assembly the finished product is cleaned and wrapped with protective packing material and finally packed into corrugated boxes for dispatch and transportation." 3.1 However, according to AO the process carried on by the assessee can never fit into the term "manufacture" as contemplated under section 80 IC of the Income Tax Act, 1961(the Act). Before Ld. CIT(A) it was submitted that by employing the aforementioned production process, there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O in the assessment order Ld. DR submitted that activity of the assessee cannot be considered to be a manufacturing activity. Therefore, she pleaded that the AO was right in disallowing the claim made by the assessee under section 80 IC. She submitted that Ld. CIT(A) has wrongly allowed the relief to the assessee and his order should be set aside and that of AO be restored. 6. On the other hand, Ld. AR relying upon the order passed by Ld. CIT(A) and decisions relied upon before Ld. CIT(A) pleaded that relief has rightly been allowed by Ld. CIT(A) and his order should be upheld. In addition to the aforementioned decisions Ld. AR also placed reliance on the following decisions: 1. Decision of Hon'ble Bombay High Court in the case of CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k or by characteristics. It is a commodity an1 article called as 'cartons'. The use of The use of the finished product is specific. The raw material cannot be used in place of the finished product and the finished product cannot be used in place of the raw material." 8 We have no doubt in our mind that the Tribunal has considered the nature of operations carried out by the assessee and by relying upon the three decisions of the Supreme Court, reached a conclusion that the assessee was carrying out a manufacturing process for making the laminated cartons. The reasoning given by the Tribunal cannot be faulted, as it does not suffer from any errors. The Tribunal has rightly discarded the view taken by the Assessing Officer. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was held that the process adopted by the assessee which was in the nature of drum assembly, drum and spoke assembly, tightening operation, balancing operation and tyre mounting operation was in was in the nature of manufacturing and such wheel assembly used by the assessee was certainly a different item from the component which was used in the process. Their Lordships of Hon'ble Punjab & Haryana High Court have upheld the order of the Tribunal with the following observations: "12. The commonly accepted meaning given to the word "manufacture" as held in the judgments of the Hon'ble Supreme Court is when a new and different article emerges having distinctive name, character or use. In the present case, the Tribunal applying the tes ..... X X X X Extracts X X X X X X X X Extracts X X X X
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