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TMI Blog2021 (9) TMI 247X X X X Extracts X X X X X X X X Extracts X X X X ..... -11. 2.The appeal has been admitted on 26.08.2020 on the following substantial questions of law : "1.Whether on the facts and circumstances of the case, the Tribunal was right in holding that the assessee was eligible for claiming deduction u/s.10B? 2.Whether the finding of the Tribunal is correct by holding that sculpturing and carving of dimensional block of granites and monument amounted to manufacture overlooking the conditions specified in Sec.2(29BA) wherein the manufacture has been defined?" 3.We have heard Mrs.R.Hemalatha, learned Senior Standing Counsel for the appellant/Revenue and Mr.M.P.Senthil Kumar, learned counsel appearing for the respondent/assessee. 4.It is not in dispute that the substantial questions of law raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and polished the block of granites and same were exported and the assessee is entitled for exemption u/s.10B when the sale invoices clearly mentioned that the assessee had exported 'processed dimensional rough or crude granite' to mean that the granite has been processed into rough/crude blocks merely making them fit for transportation?" 3.We have elaborately heard Mrs.R.Hemalatha, learned Senior Standing Counsel for the appellant/Revenue and Ms.Sri Niranjani Srinivasan, learned counsel appearing for the respondent/assessee. 4.There are three appeals arising out of three Assessment Years and we will take T.C.A.No.230 of 2010 as the lead case. 5.The assessee is engaged in the granite business and for the Assessment Year under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s & Marbles (P) Ltd. reported in (2010) 320 ITR 79 (SC) and the decision of the Division Bench of this Court in the case of Commissioner of Income-Tax, Chennai v. Pallava Granite Industries (I) (P) Ltd. reported in (2014) 221 Taxman 107 (Madras). Both the above mentioned decisions deal with granite and marble blocks. 8.The argument of Mrs.R.Hemalatha, learned Senior Standing Counsel, appearing for the appellant/Revenue, is by submitting that, during the Assessment Year under consideration, the content in Section 2(29BA) of the Act was not available, and similarly, the definition of "manufacture" under Section 10-B(7)(iii) was not there in the Statute book and therefore, the Assessing Officer was right in holding that there was no process ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Gem Granites (supra), on the scope of the expression 'manufacture', in the absence of any specific definition, we have no hesitation in giving common man's understanding as to the scope of the expression that the expression 'manufacture' would include every process, which would ultimately result in the production of new article having a different character in view." 9.The decision in the case of Arihant Tiles & Marbles (P) Ltd. (supra) would also aid the case of the assessee, wherein, the Court pointed out that it was not concerned only with cutting of marble blocks into slabs, but also concerned with the activity of polishing and ultimate conversion of blocks into polished slabs and tiles and the processes/activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the High Court of Kerala in Nishanth Exports v. Assistant Commissioner of Income-Tax, Circle-1, Mattancherry reported in (2018) 401 ITR 401 (Kerala). The said decision also would not help the case of the Revenue, because, whether garbling to make pepper edible would amount to giving rise to a different commodity distinct from the raw pepper purchased, was the issue therein. Admittedly, in the said case, the pepper both in raw form or in edible form, continued to remain as pepper. 12.The learned counsel referred to the decision of the Hon'ble Supreme Court in Lucky Minmat Pvt. Ltd. v. Commissioner of Income-Tax, Jaipur, reported in (2000) 245 ITR 830 (SC) to support her submissions that, mining of limestones and marble blocks and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'. In the circumstances, this Court held that the assessee was not entitled to the benefit of section 80HH of the Income-tax Act. However, this Court distinguished the judgment of the Rajasthan High Court in the case of CIT v. Best Chemical & Lime Stone Industries (P.) Ltd. [1994] 210 ITR 883. In that case, Best Chemical & Lime Stone Industries (P.) Ltd. (supra) was engaged in the business of extracting limestone and its sale thereafter converting it into lime and limedust or concrete which was held to be an activity of manufacture or production. The activity of conversion into lime and limedust, according to this Court, in the case of Lucky Minmat (P.) Ltd (supra) certainly constituted a manufacturing process. It was clarified in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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