TMI Blog2023 (6) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... nsion in the financial year 2011-12 relevant to assessment year 2012-13 and the year under consideration being the 9th year of claim of tax holiday, it shall be eligible for claim of deduction @ 100% and not 25% of profits and gains from its business and matter is accordingly decided in favour of the assessee and the ground of appeal is allowed. - ITA NO. 30/Chd/ 2023 - - - Dated:- 4-5-2023 - SHRI. AAKASH DEEP JAIN , VP And SHRI. VIKRAM SINGH YADAV , AM For the Assessee : Shri Manoj Kumar , C. A For the Revenue : Shri M. P. Dwivedi , Sr. DR ORDER PER VIKRAM SINGH YADAV , A. M. This is an appeal filed by the Assessee against the order of the Ld. CIT(A), NFAC, Delhi dt. 29/11/2022 pertaining to Assessment Ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction under section 80IC and deduction @ 100% was claimed. However as per the AO, the substantial expansion is available only to the existing unit that came into existence on or before 07/01/2013 and therefore he had allowed the deduction under section 80IC @ 25% instead of 100% by treating the relevant assessment year as ninth year instead of fifth assessment year for claiming deduction under section 80IC of the Act. For the purposes, the AO also relied on the decision of Hon ble Supreme Court in case of CIT Vs. Classic Binding Industries in Civil Appeal No. 7208 of 2018 dt. 20/08/2018 wherein it was held that after availing deduction for the period of five year @ 100%, the undertaking would be entitled to deduction for remaining five ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. We have heard the rival contentions and perused the material available on the record. We find that the matter is squarely covered by the latest decision of Hon ble Supreme Court in case of Pr. CIT Vs. M/s Aarham Softronics (supra) wherein the earlier decision of the Hon ble Supreme Court in case of M/s Classic Binding Industries has been held as not laying the correct law and the year in which substantial expansion is undertaken would become the initial assessment year and from that assessment year, the assessee shall be entitled to 100% deduction within overall period of deduction limited to 10 years. The said decision would bind all the authorities and once the same has been brought to the notice of the ld CIT(A), the same should hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the following legal proposition which are contained at para 24 of its order which reads as under :- 24. The aforesaid discussion leads us to the following conclusions: (a) Judgment dated 20th August, 2018 in Classic Binding Industries case omitted to take note of the definition initial assessment year contained in Section 80-IC, which does not apply in these cases. The definitions of Initial assessment year in the two sections, viz. Sections 80-IB and 80-IC are materially different. The definition of initial assessment year under Section 80-IC has made all the difference. Therefore, we are of the opinion that the aforesaid judgment does not lay down the correct law. (b) An undertaking or an enterprise which had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this 100% deduction would be for remaining three years, i.e., 8th, 9th and 10th assessment years. 8. Applying the legal proposition so laid down by the Hon ble Supreme Court in the instant case where the undisputed facts are that the assessee has started its business activity on 11.7.2005 falling between the period 7th January, 2003 and 1st April, 2012 in State of Himachal Pradesh and has carried out substantial expansion in the financial year 2011-12 and the year under consideration being the 10th year of claim of tax holiday, it shall be eligible for claim of deduction @ 100% and not 25% of profits and gains from its business as held by the lower authorities. Therefore, respectfully following the decision of Hon ble Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
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