TaxTMI 
TaxTMI 
2018 (10) TMI 1128
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....08-2009 whereas its "initial assessment year" was assessment year 2003-2004 and there is no provision of refixing initial assessment year?" 2. A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. Return of income for the assessment year 2011-12 was filed declaring total income of Rs. 14,54,21,467/- which was processed under Section 143(1) of the Act. The case was selected for scrutiny under "CASS". During the course of assessment proceedings, the Assessing Officer by invoking the provisions of Section 80IC(7) read with Section 80IA(10) of the Act recomputed the deduction admissible under Section 80IC of the Act and an addition of Rs. 7,44,41,112/- was made to the income of the assessee. Hence the income was assessed under Section 143(3) of the Act at Rs. 8,81,13,290/- vide order dated 30.01.2014, Annexure A.1. Aggrieved by the order, the assessee filed an appeal before the Commissioner of Income Tax, (Appeals), [CIT(A)]. Vide order dated 30.12.2014, the CIT(A) deleted the whole addition. Thereafter, it was noticed that the assessee had owned seven units out of which four units were located in certain special cate....
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....ted in Himachal Pradesh, the deduction was available @ 100% for five years and @ 25% for next five years. 6. The Tribunal in view of the opinion expressed by it in its decision in the case of M/s. Hycron Electronics, Baddi, Solan in ITA No. 798/Chd/2012 dated 27.05.2015 for the assessment year 2009-10 adjudicated the issue against the assessee. Learned counsel for the assessee had placed strong reliance on the decision of the Himachal Pradesh High Court in Stovkraft India vs. Commissioner of Income Tax, alongwith other appeals reported as (2018) 400 ITR 225, to contend that in the batch of appeals including the case of Hycron Electronics (supra), the order of the Tribunal was set aside and the issue was decided in favour of the assessee. 7. The issue before the Himachal Pradesh High Court in Stovkraft India's case (supra) was as to whether "undertaking or an enterprise" established after 7th January 2003 carrying out "substantial expansion" within the window period between 07.01.2003 to 01.04.2012 would be entitled to deduction on profits at the rate of 100% under Section 80IC of the Act and if so then for what period. The answer was given in the affirmative. It w....
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.... Section 80IC of the Act, can start claiming deductions @ 100% again for next five years as they had undertaken "substantial expansion" during the period mentioned in sub-section (2) thereof? The answer has to be in the negative for the following reasons: 18. We are dealing with the deductions in respect of profits and gains under Section 80-IC of the Act. No other provision is involved. This section makes special provisions in respect of certain undertakings or enterprises in certain special category States. Section 80-IC was inserted by the Finance Act, 2003 w.e.f. April 1, 2004. As per this provision, certain undertakings or enterprises in certain special category States are allowed deduction from such profits and gains, as specified in sub-section (3) of Section 80-IC. The provisions of Section 80-IC provided deduction to manufacturing units situated in the State of Sikkim, Himachal Pradesh and Uttaranchal and North-Eastern States. The deduction was provided to new units established in the aforesaid States, and also to existing units in those States if substantial expansion was carried out. The deduction was available @ 100% for ten Assessment Years for the units locat....
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....od of 10 years, on the basis that it had carried substantial expansion in its unit." 9. While the Apex Court adjudicated the issue in favour of the revenue, it specifically distinguished its earlier pronouncement in Mahabir Industries vs. Principal Commissioner of Income Tax (Civil Appeal Nos.4765-4766 of 2018 decided on May 18, 2018 in the following terms:- "21. We are conscious of our recent judgment rendered by this very Bench in Mahabir Industries vs. Principal Commissioner of Income Tax (Civil Appeal Nos. 4765-4766 of 2018 decided on May 18, 2018). However, a fine distinction needs to be noted between the two sets of cases. In Mahabir Industries, the assessees had availed the initial deduction under a different provision, namely, Section 80-IA of the Act, i.e. by fulfilling the conditions mentioned in sub-section (4) of Section 80-IA. Those conditions are altogether different. Deduction in respect of profits and gains under the said provision is admissible when these profits and gains are from industrial undertakings or enterprises engaged in infrastructure development etc. Even this availment started at a time when Section 80-IC was not even on the statute b....