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TMI Blog2017 (11) TMI 1685X X X X Extracts X X X X X X X X Extracts X X X X ..... f law and facts are involved hence they are decided by this common judgment. 3. By way of these appeals, the appellant has assailed the judgment and order of the tribunal whereby tribunal has dismissed the appeal of the department and confirmed the order of the CIT(A). 4. Counsel for the appellant has framed following substantial questions of law:- Appeal No.294/2017 & 296/2017 "(1) Whether the Hon'ble ITAT is justified in confirming the decision of the CIT(A) in deleting the disallowance of Rs. 63,42,433/- made by the assessing officer under Section- 10AA of Income Tax Act, 1961 even though when the assessee does not fulfill the conditions of Section 10AA(4)(ii) of the Income Tax Act, 1961 namely that the undertaking should not be fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. Green Fire Exports has not been formed out of new funds, but it merely reflects shift of money from the original business i.e. M/s. Green Fire to the new one. 6. Now the issue is squarely covered by the decision of this court in ITA No.10/2016 (Pr. Commissioner of Income Tax vs. M/s. Green Fire Exports) decided on 18.5.2017 in case of same assessee wherein while considering the matter, this court observed as under:- "6. Counsel for the respondent Mr. Pathak has taken us to the order of the CIT(A) which reads as under: "After considering submission of th AR as well as AO and considering various aspects the allowability of deduction u/s 10 AA in the case of appellant is decided taking an over all view. Admittedly the new industrial u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that where the new industrial undertaking is separate and independent production unit and the undertakings can be carried out separately without complete absorption of identity of the old business they are not to be treated as business formed by reconstruction of the old business. The Hon'ble Court has observed that by establishing new undertakings if the assessee expands his existing business then also the assessee cannot be deprived of the benefit. That every new creation in business is some kind of expansion and advancement but as long as a new and identifiable undertaking separate and distinct from the existing business is set up, it cannot be tantamount to reconstruction. As plant and machinery of the old business is lying as it is, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y in existence" - there must be a continuation of the activities and business of the same industrial undertaking. The undertaking must continue to do same business though in some altered or varied form. In the instant case the earlier industrial undertaking was owned by Smt. Kamlesh Dangayach while the present undertaking is owned by the firm. The firm is separate entity under the income tax Act and the earlier industrial undertaking of the assessee must cease to the function. The deduction u/s 10 AA is undertaking specific. The Hon'ble Allahabad High Court in the case of CIT V/s Modi Spinning and Manufacturing 125 ITR 361 had occasion to considere to the allowibility of deduction u/s 15C of I.T. Act 1922. The revenue argued that the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness already in the existence. 1 CIT V/s Ambur Cooperative Sugar Mills Ltd. (Madras) 127 ITR 495. 2 Addl. CIT V/s Hutti Gold mines Company Ltd. 128 ITR 476 (Karnataka) In this case existing plant and conveyer belts and old mill dismanted and the new mill and refinery covering fortunes area of factory was setup. New unit is independent unit and is entitled to deduction and it will not be reconstruction of business. (3) CIT V/s Mahaan foods Ltd. 216 CTR 148 (Delhi) In this case assessee setup industrial undertaking with latest technology and increased capacity with frest investment of Rs. 104.88 laks as against investment 20.8 laks in old plant and it cannot be said that the unit was a result a reconstruction of old business. (4) C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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