TaxTMI 
TaxTMI 
2017 (8) TMI 1405
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....w and facts are involved therefore, they are decided by the common judgment. 2. By way of these appeals, the appellant has challenged the judgment and order of the tribunal whereby the tribunal has dismissed the appeal. 3. This court while admitting the appeals has framed following substantial questions of law:- D.B. Civil Income Tax Appeal No.222/2012 admitted on 05.05.2014 "Whether the Tribunal as well as CIT(A) were justified in granting deduction to the assessee under Section 10AA of Rs. 12,26,32,018/- by holding that trading of goods is a service, eligible for deduction u/s 10AA?" D.B. Civil Income Tax Appeal No.151/2015 admitted on 05.07.2016 "Whether the Tribunal as well as CIT(A) were justified in grant....
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....tself, without at all considering the specific findings recorded by Assessing Officer as per which the assessee was not entitled for deduction u/s 10AA of the Act of Rs. 7,07,51,730?" (ii) Whether the assessee is entitled for deduction u/s 10AA of the Act, ignoring that the assessee failed to fulfill the conditions provided under section 10AA of the Act and expanding the scope of the definition of ward "Services" from Section 2(z) and Second Schedule of SEZ Act, 2005 and Rules, 76 of SEZ Rules, 2006, ignoring that deliberately the same was not defined by the legislators under the Income Tax Act, and a literal meaning of word "Service" was rightly taken by the Assessing Officer?" D.B. Civil Income Tax Appeal No.70/2016 admitted o....
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.... under the special economy zone. The activity which has been carried out by the assessee was not manufacturing activities and rather it was trading which was never contemplated by the legislation while giving the benefit to the assessee. 5. He also contended that the activities which have been referred by the Tribunal and services will not include manufacturing. 6. However, counsel for the respondents contended that both the authorities namely CIT (Appeals) as well as the tribunal after taking into consideration the law on the point has discussed the matter in detail and while considering the instructions issued by the Ministry of Commerce and Industry under the SEZ Rules, 1976, observed as under:- "As per INSTRUCTION NO. 4/2....
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....." The instruction specifies that the activity of trading in the nature of re-export of imported goods is eligible for benefit under section 10AA. The assessee company on the activity of trading in the nature of reexport of imported goods claims benefit under Section 10AA justifying its classification under service (referred to as "provide any service" under the said section). As the Income Tax Act does not define the term "service", the assessee company has to take reference to the definition of service referred to in the SEZ Act, 2005 (given that the Section 10AA was introduced by SEZ Act, 2005 and referred to in the Second Schedule to the said Act) and furthur the SEZ Act, 2005 has overriding effect on all other enactments by virtue of s....
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....assessment order are not at all applicable in the case. It will be thus clear that trading activity in the nature of re-export of imported goods is falling under the head service u/s 10AA of I. T. Act, 1961 r/w section 2(z) of SEZ Act, 2005 r/w rule 76 of SEZ Rules, 2006 and above referred notification. We also submit herewith clarification issued by Development Commission SEZ, Sachin, Surat issued to the assessee company which is self explanatory and states that assessee company is entitled to the benefit of section 10AA of I. T. Act, 1961 in respect to import of goods which are re-exported to buyers in other countries in view of provisions of section 2(z) of SEZ Act, 2005 r/w Section 27 and section 51 of SEZ Act, 2005 r/w rule 76 of SEZ R....