TaxTMI 
TaxTMI 
TaxTMI 
2011 (7) TMI 81
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....the receipts of Rs.34,37,154/- from sub contract for the assessment year 1989-90 in the computation of eligible business income for the purpose of computation of relief under Section 80 HH of the Income Tax Act, 1961? 2. The following substantial question of law was raised by the assessee in T.C.No.753 of 2004: " Whether the Appellate Tribunal is right in excluding the receipts of Rs.1,29,40,847/- from sub contract for the assessment year 1992-93 in the computation of eligible business income for the purpose of computation of relief under Section 80 HH of the Income Tax Act, 1961? " 3. The assessee herein is a company engaged in the manufacture and sale of High Tensile Fasteners, Cold Extruded parts, Powder Metal Par....
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....y, the Officer held that the assessee would not be entitled to the deduction under Section 80 HH of the Act. Although he pointed out that the benefit under Section 80 HH of the Act was to be granted while arriving at the profit of the undertaking of the assessee at Krishnapuram Unit and Hosur, while computing the relief in the annexure, the Assessing Authority herein failed to carry out the reasoning in the manner in which it deserved. Consequently, the assessee went on appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) pointed out that the Officer had merely discussed about the principle without granting the relief under Section 80HH and 80I of the Act. In the circumstances, he directed the Ass....
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....t at Krishnapuram, located in a backward area, is engaged in the production of articles, the receipts made by the said units qualified for deduction under Section 80 HH of the Act. Thus placing reliance on the decision of this Court reported in [1999] 238 ITR 540 - CIT Vs. T.N. Heat Treatment and Fetting Services and [2007] 288 ITR 92 - CIT Vs. Taj Fire Works Industries, learned counsel submitted that in the light of the law declared by this Court, the order of the Tribunal has to be set aside and the direction of the Commissioner of Income Tax (Appeals) be given effect to. 8. Per contra, learned Standing Counsel appearing for the Revenue, however, submitted that given the fact that the receipts are in the nature of sub contract rec....
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....ing them to heat treatment, in order to toughen them to the requisite standards so that they could be sold in the market is a manufacturing activity, entitled to claim the deduction under Sections 80 HH and 80-I of the Income Tax Act, 1961. In so holding, this Court followed the decision of this Court reported in [1999] 238 ITR 540 - CIT Vs. T.N. Heat Treatment and Fetting Services (P) Limited, pertaining to the same assessee relatable to the assessment years 1984-85 to 1986-87, wherein, this Court viewed that the assessee's case could not be anything other than the one relatable to manufacturing activity, entitling it to claim necessary deductions under Sections 80HH and 80-I of the Income Tax Act. Thus, in a case of job work, this Court u....
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....tions 80 HH and 80-I of the Income Tax Act to the assessee herein. Even though learned Standing Counsel appearing for the Revenue sought for remand in this case, we do not find any ground to remand the matter, since there is no controversy as regards the facts. 15. As far as placing reliance on the decision of the Apex Court in the case of Pandian Chemicals Ltd. Vs. Commissioner of Income Tax) reported in [2003] 262 ITR 278 is concerned, we do not find, the said decision, in any manner, goes against the case of the assessee. The Unit at Krishnapuram is stated to be the only unit having hot forging machine. It is stated that the assessee, based at Krishnapuram, received bolts and nuts from Padi, manufactured using cold forging. The K....