ACIT, NEW DELHI vs. M/S. AVISHKAR ENGINEERS, NEW DELHI

PDF · subscribers
ITA 2788/DEL/2016Status: DisposedITAT Delhi08 December 2017AY 2010-114 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s decision, finding no merit in the Revenue's appeal. The Tribunal noted that previous ITAT orders and a subsequent AO assessment had accepted the assessee's manufacturing activity and eligibility for Section 80IC deduction.

What were the facts?

The assessee claimed deduction under Section 80IC for manufacturing gas stoves and parts. The AO disallowed the claim, stating the assessee was only assembling and testing, not manufacturing. The CIT(A) allowed the deduction, relying on previous ITAT orders that favored the assessee on similar facts.

What were the issues?

Whether the assessee's activities constituted manufacturing for the purpose of Section 80IC deduction, and whether the AO's disallowance was justified in light of previous favorable rulings.

Which sections of the Income-tax Act were involved?

Section 80IC,Section 133(6),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCHES “B” : DELHI

Before: SHRI BHAVNESH SAINI & SHRI PRASHANT MAHARISHI

Hearing: 05.12.2017Pronounced: 08.12.2017

ORDER PER BHAVNESH SAINI, J.M.

This appeal by Revenue has been directed against the order of the Ld. CIT(A)-12, New Delhi, dated 29th February, 2016, for the A.Y. 2010-2011.

2.

Briefly, the facts of the case are that assessee-firm is engaged in the business of manufacturing of gas stoves and parts.

The assessee during the year under consideration claimed deduction under section 80IC of the Act which assessee was claiming since A.Y. 2007-2008. In the immediately preceding A.Y. i.e., A.Y. 2009-2010

2 ITA.No.2788/Del./2016 M/s. Avishkar Engineers, New Delhi. deduction under section 80IC of the Act was not allowed to the assessee. Similarly, in A.Y. 2008-09 the assessee claimed for deduction under section 80IC of the Act was also rejected on the ground that assessee was not engaged in any manufacturing activity.

The A.O. issued notice under section 133(6) of the Act to various parties for verifying the manufacturing process of the assessee. The A.O. after due enquiry held that assessee is merely assembling and testing procedures undertaken in the unit. Therefore, claim of assessee as manufacturing unit was rejected and deduction under section 80IC was disallowed.

3.

The assessee contended before Ld. CIT(A) that assessee made claim of deduction under section 80IC of the Act in A.Y. 2007-

8.

Deduction under section 80IC of the Act was disallowed for A.Ys.

2008-09 and 2009-10, however, the ITAT, Delhi Bench vide its order in ITA.No.206/Del./2012 dated 10th April, 2014, has allowed deduction under section 80IC for A.Y. 2008-2009. The Ld. CIT(A) found that in A.Y. 2008-09, the Ld. CIT(A) allowed deduction under section 80IC vide order dated 11th October, 2011. His findings are reproduced in the order and that the ITAT, Delhi Bench vide order dated 11th July, 2014 dismissed the departmental appeal for A.Y.

3 ITA.No.2788/Del./2016 M/s. Avishkar Engineers, New Delhi. 2008-2009. The order of the Tribunal is also reproduced in the order.

The Ld. CIT(A) also noted that the appellant has transactions with all these parties during A.Ys. 2009-10 and 2011-12 also in which A.O. has accepted the purchases from these parties. Therefore, these parties are existing. The Ld. CIT(A) accordingly, set aside the order of the A.O. and directed the A.O. to allow deduction under section 80IC of the Act to the assessee.

4.

After considering the rival contentions, we do not find any merit in the departmental appeal. The Learned Counsel for the Assessee, at the outset, submitted that in A.Ys. 2008-09 and 2009- 2010, the Ld. CIT(A) has allowed deduction under section 80IC of the Act on the same facts on which the Tribunal dismissed the appeal of the Revenue vide order dated 11th July, 2014 and 9th August, 2016.

Copies of the orders of the Tribunal are on record. Learned Counsel for the Assessee also submitted that in A.Y. 2014-2015, A.O. has allowed deduction under section 80IC to the assessee vide order dated 16th December, 2016 under section 143(3) of the I.T. Act. Copy of the order is produced on record. These facts clearly support the findings of the Ld. CIT(A) that assessee was engaged in manufacturing process and thus, was entitled for deduction under 4 ITA.No.2788/Del./2016 M/s. Avishkar Engineers, New Delhi. section 80IC of the Act. The issue is also covered in favour of the

More judgments on Section 80IC

All 1,180 judgments and leading authorities on Section 80IC →

Recent GST High Court judgments

Search GST case law →