9911796707
TMI Blog2016 (12) TMI 1798X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in business of manufacturing trading, export & import ornaments, jewelry, precious stones, diamond & gold manufacture and export from SEZ at Sachin, Surat, filed its return of income for the A.Y. 2011-12 declaring the total income of Rs. 3,56,502/- after claiming the deduction u/s 10AA of the Act amounting to Rs. 60,71,726/-. The return was processes and assessment order u/s 143(3) of the Act was passed determining the total income at Rs. 64,31,730/- after disallowing Rs. 60,71,726/- claimed by the assessee u/s 10AA of the Act. The assessee challenged the impugned order before the Ld. CIT(A) who after hearing the assessee allowed the appeal of the assessee holding that the appellant is entitled to claim exemption u/s 10AA of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that the A.O made addition just on the basis of presumption and suspicion; as in the assessment order, the A.O has firmly established the fact that no manufacturing activity was being carried out by the assessee at the SEZ premises." 3. The Ld. Departmental Representative (DR) relying on the assessment order, submitted that the impugned order is liable to be set aside as the A.O has established that the assessee did not carry out any manufacturing activities in the SEZ premises at Surat in the F.Y. 2010-11. There was no power connection to undertake manufacturing activities. Moreover, the law relied upon by the Ld. CIT(A) is not applicable to this cases as the facts of the instant case are different from the cases relied upon by him. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t financial year. The Ld. Counsel further submitted that the Mumbai Tribunal has decided the similar issue in favour of the assessee in AICT vs. M/s Gia Exports (ITA No 8080 to 8082/M/2011 for the AYs 2006-07, 2007-08 & 2008-09 respectively.) 6. We have heard the rival submissions and also gone through the material placed before us including the decision relied upon the assessee. The only issue to be adjudicated in this case is whether the assessee is entitled for exemption u/s 10AA of the Act. The Ld. CIT(A) has decided the issue involved in this case in favour of the assessee holding as under:- "8. in the present facts of the case, even the A.O is not disputing the fact that the appellant has made exports out of imported goods. I hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n SEZ, surat. Raw material was imported and the final department. All the papers relating to the shipment and foreign remittances were in order. The assessee has submitted that there was no Import and Export activity taken place in survey year. Accordingly, the CIT(A) found that there was no case of the A.O to deny the deduction to the assessee. We further noticed that even there is no finding in the order of the A.O that survey party has conveyed to the A.O or in detailed report that there was no export or import of items manufactured by the assessee at the premises. The survey party in fact noted that irregularities or discrepancies at the time of survey and not of the past. The A.O has assumed that in the past as the unit was not functio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; in the case of M/s. Amar Exports v. Addl. CIT, Range-9, Surat vide Ahmedabad ITAT in ITA no. 436/Ahd.20 and again by the Hon'ble Mumbai ITAT in the case of M/s. Gitanjali Exports Corporation Ltd. vs. ADCIT-5(1), Mumbai in ITA nos. 6947 & 6948/6718 & 6783/6949 & 6950/6758 & 6787/Mum/2011. 10. In view of the above observations, the appellant is entitled to claim exemption u/s 10AA. Accordingly, the AO is directed to allow the exemption of Rs. 60,71,726/-as claimed in the return of income." 7. We notice that in this case the assessee has placed on record the copy of letter dated 12.3.2014 from the then officer on special duty, addressed to the ITO14(2)(4) Mumbai, vide which certain information u/s 136 of the Act were supplied. From the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decision of the coordinate Bench rendered in ACIT v/s Gia Exports,(supra) in which the coordinate Bench of the ITAT has decided the similar issue in favour of the assessee and against the revenue. In the said case the AO had denied deduction on the basis of report of survey party without taking into consideration the detailed explanation submitted by the assessee. In the present case also the AO has not accepted the evidence adduced by the assessee to establish that since there was no electricity connection generator was hired and manpower was also arranged to carry out the manufacturing activities. Therefore, in our considered opinion, the impugned order passed by the Ld. CIT(A) is in accordance with the view taken by the coordinate Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X
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