TaxTMI 
TaxTMI 
2013 (8) TMI 699
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....ted to scrutiny u/s 143(3) of the Act. After due examination of the books of account and the details furnished by the assessee, the AO had concluded the assessment, determining the assessee's income at Rs.1,79,82,653/- after disallowing certain expenses, aggregating to Rs.2.91 lakhs. 3.1.1. In the meanwhile, the jurisdictional CIT, in a suo motu action, invoked the provisions of section 263 of the Act on the premise that the assessment order was erroneous and pre-judicial to the revenue as the AO, according to the CIT, had wrongly allowed deduction u/s 80IB (3) of the Act as claimed. For the reasons set out in his order u/s 263 of the Act dated 16.1.2009, the CIT had set aside the assessment order with a direction to decide the claim u/s 80IA/80IB accordingly. 3.1.2. Consequently, the AO, vide his order u/s 143(3) r. w. s. 263 of the Act dated 14.12.2009, as per the directions contained in the CIT 's order u/s 263 of the Act (supra) and for the reasons recorded therein, disallowed the assessee's claim of Rs.75,81,910/- u/s 80IB (3) of the Act. 3.2. Aggrieved, the assessee took up the issue with the CIT (A) for reconsideration. After considering the elaborate contentions put-fort....
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....hinery to designate the industrial undertaking as SSI Unit. Thus, out of these five conditions, the first two conditions may be called static or unchangeable. In other words, if in the initial year of manufacture or production it is substantiated that it has fulfilled these two conditions the AO cannot on this ground in subsequent eligible years of the block period deny the benefit u/s 80IB. The rest three conditions are volatile and unstable. The industrial undertaking must show in each subsequent year of claim that these three conditions have not been violated. Such claims of the assessee have to face the analysis and scrutiny of the AO. Thus, since each AY is separate and independent, the revenue authorities had every power to examine and analyse the facts and figures as well as relevant law points of each year to find out whether all these three conditions are fulfilled or not. It is also the ratio of the cited in that case that the first two conditions have already been satisfied and it is assumed that the fourth condition has been fulfilled in that year and, hence, the relief. The same is also the ratio in the case of M/s. Nanak Dehydration (P) Limited v. Asst. CIT (2010) 134....
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....e years and that the assessee having satisfied the conditions, the CIT (A) ought to have allowed the deduction as claimed in full. 4.1. To drive home his point, the learned AR had placed strong reliance on the following case laws: (i) CIT v. Nippon Electronics (India)(P) Ltd - (1990) 181 ITR 528 (Kar); & (ii) Sami Labs Ltd v. ACIT -(2011) 334 ITR 157 (Kar) 4.2. On his part, the learned D R had supported the stand of the authorities below on the issue. The learned D R had relied upon the ruling of the Hon'ble Delhi High Court in the case of Praveen Soni v. CIT reported in (2011) 333 ITR 324 (Del). 5. We have carefully examined the rival submissions, perused the relevant case records and also the case laws on which the parties concerned have placed their reliance. 5.1. It was the stand of the AO that the assessee had invested in plant and machinery at the end of the previous year relevant to the assessment year under consideration which exceeded the prescribed limit for qualifying as a SSIU as per the relevant provisions of s. 80IB (3) of the Act and, thus, proposed to deny the claim of the assessee. This was contested by the assessee on the premise tha....
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.... scale, industrial undertaking for the purposes of this Act until the definition aforesaid is altered or superseded by any notified order made under sub-section (1).: 5.2. However, the learned AR argued that once the relief is allowed in the initial year; such a relief cannot be denied in the subsequent years even if the investment in plant and machinery increases beyond the limit prescribed for that year. Placing reliance on the ruling of the Hon'ble jurisdictional High Court in the case of Nippon Electronic (I) (Pvt) Limited (supra), the learned A.R argued that the claim u/s 80IB (3) of the Act should not have been denied. 5.3. We have perused the ruling of the Hon'ble Court (supra) wherein, while considering the allow-ability or otherwise of deduction u/s 80J of the Act, it has been held, among others, that ............the eligibility stands determined in the initial assessment year and once an industrial undertaking is found eligible in the initial year of manufacture, such benefit could be availed of in any of the succeeding four years. With due respects, we would like to reiterate that the assessee cannot take support in the said ruling as the issue, before the Hon'ble Cour....
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....the industrial undertaking as SSI unit. Thus, out of these give conditions; the first two conditions may be called formative or unchangeable. In other words, if in the initial year of manufacture or production, it is substantiated that it has fulfilled these two conditions, the Assessing Officer cannot on this ground in subsequent eligible years of the block period deny the benefit u/s 80IB. The rest of the three conditions are to be fulfilled on year to year basis. The industrial undertaking must show in each subsequent year of claim that these three conditions have not been violated. Such claims of the assessee have to face the analysis and scrutiny of the Assessing Officer. Thus, since each assessment year is separate and independent, the revenue authorities had every power to examine and analyse the facts and figures as well as relevant law points of each year to find out whether all these three conditions are fulfilled or not. 5.3.2. We have also perused the ruling of the Hon'ble jurisdictional High Court in the case of Sami Labs Limited v. ACIT reported in (2011) 334 ITR 157 (Kar), in which the learned AR placed strong reliance. It has been ruled by the Hon'ble Court that "A....