TaxTMI 
TaxTMI 
2013 (12) TMI 715
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....t's case, the Hon'ble C. LT. (A) failed to appreciate the principles laid down in various decisions, relied upon by the appellant firm and also to distinguish the same. The Hon'ble C. l. T. (A), grossly failed to give appropriate consideration to the intention of legislation in defining the term "manufacture", which was relied upon by the appellant firm. 3)In law and on the facts & in the circumstances of the appellant's case, the Hon'ble C. I. T. (A) failed to appreciate the fact that on one hand, on the face of the assessment order itself, the Ld. A. O. has treated the appellant as " Manufacturer and Exporter of Cut and Polished Diamonds", but while framing the assessment, treated the appellant as 'not a manufacturer' and as a consequence, not entitled to addition depreciation on Plant & Machinery. 4)The appellant craves leave to add, amend, substitute, rescind and br alter all/any grounds of appeal before or at the time of hearing. Assessee, engaged in the business of manufacturing and export of Cut & Polished Diamonds, filed its return of income on 25. 09. 2008 declaring total income of Rs. 27. 03 Crores. Assessing Officer(AO)finalised the assessment u/s. 143(3) of the Act o....
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.... 1073-1075/Mum/2009- A. Ys. 1998-99, 1999-2000 &2000-01 dated 25. 01. 2012) 'C' Bench of Mumbai Tribunal has followed order of Sheetal Diamonds Limited, that the issued was covered in favour of the assessee. Departmental Representative (DR) supported the order of AO and FAA. 5. We have heard the rival submission and perused material on records. We find that while deciding the case of Sheetal Diamonds Limited(supra), J Bench of Mumbai Tribunal has relied upon the case of Arihant Tiles and Marbles P. Ltd. (ATMPM), (320 ITR 79-SC), whereas AO and the FAA have relied upon the judgment delivered by the Hon'ble Apex Court in the case of Gem India Manufacturing Co(supra). We find that while deciding the case of ATMPL(supra) Hon'ble Supreme Court has not discussed the matter of Gem India Manufacturing Co. (supra). We further find that in the case ATMPL question before the Hon'ble court was whether the assessee was entitled to the benefit of deduction under section 80-IA of the Act, where as in the present case we have to decide whether the assessee is eligible to claim additional depreciation even though it is not manufacturing an article or thing. 5. 1. In the case of India Gem Manufact....
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....Tribunal upon which it could have reached the conclusions that, either in common or in commercial parlance, raw diamonds were not the same thing as polished and cut diamonds, and that they were different entities in the commercial world. An ipse dixit of the Tribunal is not the best foundation for a decision. The High Court, as aforestated, concluded that the case was covered by its decision in the case of CIT v. London Star Diamond Co. (I. ) Ltd. [1995] 213 ITR 517. It was not pointed out to the High Court that the question in that case was whether the assessee was an industrial company within the meaning of section 2(8) of the Finance Act, 1975, and that, in answering that question, the High Court had held that raw diamonds and cut and polished diamonds were different and distinct marketable commodities having different uses;therefore, a company engaged in cutting and polishing raw diamonds for the purpose of export was engaged in the processing of goods to convert them into marketable form. The question that the High Court and we are here concerned with is whether, in cutting and polishing diamonds, the assessee manufactures or produces articles or things. There can be little ....
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....refers to the word production, it means manufacture plus something in addition thereto. The word production was not under consideration before this court in the case of Aman Marble Industries P. Ltd. [2003] 157 ELT 393 (SC). Be that as it may, in that case, it was held that cutting of marble blocks into slabs per se did not amount to manufacture . This conclusion was based on the observations made by this court in the case of Rajasthan State Electricity Board, AIR 2000 SC 2382. In our view, the judgment of this court in Aman Marble Industries P. Ltd. [2003] 157 ELT 393 (SC) also has no application to the facts of the present case. One of the most important reasons for saying so is that in all such cases, particularly under the excise law, the court has to go by the facts of each case. In each case one has to examine the nature of the activity undertaken by an assessee. Mere extraction of stones may not constitute manufacture. Similarly, after extraction, if marble blocks are cut into slabs that per se will not amount to the activity of manufacture. Before concluding, we would like to make one observation. If the contention of the Department is to be accepted, namely, that the acti....