2011 (9) TMI 652

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....Assessment under Section 143(3) of the Act was completed by the Assessing Officer (AO). During the course of assessment proceedings, it was observed by the AO that the assessee had claimed exemption under Section 10B of the Act. During the course of scrutiny proceedings, the AO observed that certain necessary conditions which are required to be fulfilled for claiming exemption under the said Section are not fulfilled by the assessee company. After considering the submissions of the assessee in this regard, the AO denied the exemption under Section 10B of the Act to the assessee company and made disallowance of Rs. 1,00,22,725/- in the total income of the assessee. Reasons given by the AO were as under:   "(i) That the assessee has bee....

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....ready in existence and was not formed by the transfer to a new business profession used for any purpose.   4. Likewise, the CIT (A) was not convinced that the third reason given by the AO holding that the observations of the AO that the assessee was not maintaining books of accounts was based on a misappreciation of fact. The CIT (A) re-emphasized that the assessee operated as DTA unit till 31.7.2006. With effect from 01.8.2006, it started operating as 100% EOU (SEZ) unit. There was no mention under Section 10B(2) of the Act of any requirement for maintaining separate books of account and it was not necessary to maintain separate books of account for claiming deduction under that provision.   5. The Revenue challenged the afores....

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.... and approval under 100% EOU was granted to the assessee respondent on 11.7.2006.   8. Thereafter, the assessee was issued Green Card No.120 on 11.7.2006 by the Development Commissioner, Noida SEZ. Licence for the Private Bonded Warehouse under Section 58 of the Customs Act, was also granted to the assessee on 31.7.2006.   9. Learned counsel for the assessee is right in his submission that the power to grant approvals to 100% EOUs initially vested with the Board specifically constituted under Section 14 of the Industries (Development & Regulation) Act, 1951.   However, the Government in a series of measures aimed at speeding up the approval process, had delegated the powers for approval to the Development Commissioner. Thu....