2010 (12) TMI 414

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....9] 238 ITR 762, and contended that the said decision, though rendered in the context of the assessee's entitlement for investment allowance under section 32A of the Act, is applicable for considering the eligibility for deduction under section 80-IB of the Act and so much so, the appeal should be allowed by following the said decision. However, the Division Bench prima facie doubted whether processing of goods done for another party by the assessee could be treated as manufacture or production of any article or thing for the purpose of deduction under section 80-IB of the Act. Accordingly, for a detailed consideration of correctness of the said decision, the matter was referred to the Full Bench. We have heard senior counsel, Sri S. Ganesh ....

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....ng for the respondent on the other hand submitted that the decision of this court relied on by the assessee is in respect of investment allowance under section 32A and the decisions of the Supreme Court relied on by the assessee are also not in the context of section 80-IB of the Act.   4. The only question to be considered is whether production of compound rubber on job work for the tyre manufacturing companies by the assessee amounts to "production of an article or thing" qualifying for deduction under section 80-IB of the Act. The Division Bench decision of this court above referred to is clearly on the point, though in the context of investment allowance under section 32A, because the assessee in that case also was engaged in ma....

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....is manufactured. If processing of iron ore which is only raw material for producing iron therefrom, amounts to manufacture or production of any article or thing, then we see no reason why compound rubber cannot be treated as an article produced by the assessee though for the tyre manufacturing company under contract. In other words, there is nothing in the section to indicate that article or thing produced or manufactured should be final product in itself. So much so, the activity of the assessee in their new industrial unit, which is mixing rubber with chemicals, process oil, etc., making compound rubber, is covered by section 80-IB of the Act. We notice that the Tribunal has disallowed the claim by following the decision of the Supreme Co....