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TMI Blog2018 (2) TMI 1143X X X X Extracts X X X X X X X X Extracts X X X X ..... nd argued, the said delay was caused due to administrative constraints and the delay is not deliberate. Accordingly, he prayed to condone the delay and admit the appeal. The Ld. AR reported no objection in condoning the delay. On perusal of the affidavit and hearing both the parties, we are of the opinion the reasons stated in the affidavit are reasonable and bonafide and it was not deliberate or intentional to file the appeal with delay. Accordingly, we condone the delay of 17 days in filing the appeal. 3. Ground no. 1 is relating to deletion of disallowance on account of levy of cess on green leaves. 4. The brief facts relating to the issue are that the assessee is a company and engaged in the business of manufacturing and selling of bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition of Rs. 36,40,224/- on account of cess on grean leave. Ground no. 1 of the appeal is allowed." 5. After hearing the both the parties, we find that, the Honourable Supreme Court dismissed the SLP filed by the appellant revenue and agreed with the interpretation of scope of Rule 8 of Income Tax Rules 1962 rendered by the Hon'ble High Court of Calcutta in the case of AFT Industries Ltd supra. The Learned AR placed copy of such order before us and submitted that the present appeal may be disposed of in pursuance of the decision of Hon'ble Supreme Court and learned DR submitted that the appellant revenue did not succeed in SLP and the decision of Honourable High Court of Calcutta has become final and binding on the appellant revenue in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed." In arriving at the aforesaid conclusion, the High Court has referred to the various judgments of this Court. We are of the opinion that the High Court has rightly interpreted the scope of Rule 8 of the Income Tax Rules 1962. We, thus, find no merit in this appeal which is, accordingly, dismissed. " 6. In accordance with the principle as laid by the Hon'ble High Court of Calcutta in the case of AFT Industries which has been further strengthened by dismissal of SLP by the Honble Supreme Court, we hold that the cess levied on the production of green leaf would come under the purview of composite income. Thus, ground no-1 raised by the revenue is, accordingly dismissed. 7. Ground no. 2 is relating to deletion of addition made on acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to account only those machineries which are actually being utilized by the assessee for the purpose of its manufacturing business and not otherwise. The CIT(A) considering the submissions of assessee, sought remand report from the AO to find out whether the value of plant and machinery should include the value of fixed asset pertaining to farm and irrigation or whether plant and machinery should be relatable only to those process of manufacturing. The AO in its remand report stated that the irrigation and water supply system is the prime requirement for growing tea as no plant can grow without water and proper irrigation and also irrigation and water supply system also forms plant and machinery. The CIT(A) considering the submissions as wel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g, the appellant claimed deduction only in relation to the manufacturing process, it appears that for the purpose of Section 80lE, only the machineries relevant for the manufacturing process, should be considered as relevant. 9n the basis of this understanding, the appellant's claim for not taking into account the machineries viz., Water Supply System Rs. 97,777) and Irrigation (Rs. 14,35,49 shown under "Farm Account", appears to be justifiable. Accordingly,' I am inclined to accept the appellant's claim that to determine as to whether there had occurred substantial expansion, as required u/s. 80lE(2)(ii)/(7)(ii), the above mentioned two machineries viz., Water Supply System (Rs. 97,777) and Irrigation (Rs. 14,35,499), should no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tea. The assessee grows tea in its own gardens and manufactures tea from such produce. The case of the assessee is that this deduction is available in case a assessee manufacturing of tea and hence only plant and machinery of manufacturing is to be considered. Whether the opening valuations of plant and machineries of water supply system and irrigation system as shown under farm account is to be considered the part and parcel of the value of plant and machinery as on 01.04.2009 for calculating the percentage of addition to plant and machinery for claiming deduction u/s 80IE or not is the issue before us. We find that the water supply system and irrigation system admittedly are not part of tea manufacturing processes. Therefore, the said ..... X X X X Extracts X X X X X X X X Extracts X X X X
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