TaxTMI 
TaxTMI 
2020 (9) TMI 614
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....ncome of Rs. 10,51,79,840/- after claiming deduction of Rs. 42,41,29,196/- under Section 10AA of the Act which was duly processed under Section 143(1) of the Act. Ultimately the assessment was finalized under Section 143(3) of the Act inter alia disallowing the claim of deduction under Section 10AA to the tune of Rs. 42,41,29,196/- and added back to the total income of the assessee. The assessee has not manufactured and/or produced articles or things or provided any services during the previous year to A.Y. 2012-13 from its SEZ Unit as of the observation made by the Ld. AO and such claim was disallowed. In appeal the same was deleted by the Ld. CIT(A) relying upon the order passed by his predecessor in assessee's own case on identical issue for A.Ys. 2010-11 and 2011-12 holding that the assessee is carrying out the manufacturing activities and hence is entitled to the claim made under Section 10AA of the Act within the meaning of the provision under Section 2(r) of the SEZ Act, 2005. 3. At the time of hearing of the instant appeal the Ld. Counsel appearing for the assessee submitted before us that the assessee's case is covered on identical issue by and under the order passed by t....
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....as hired 7 tanks of different capacity for Fuel Oil storage from APSEZ The blending activity takes place at the time of import of cargo/ new arrival. The product being imported have the specification of i.g. "B" Grade. The product of B Grade is received in tank which already have the product of A Grade, hence the specs of Imported Cargo is changed to C Grade, when it is blended with A Grade cargo already in the tank. At the time of Import there remains some product in the tanks which have specification of i.g. "A" Grade The blending activity takes place also when the product of different grades lying in various tanks is mixed and a product of a new grade comes into existence. As an operational requirement or specific order for supply the assessee company needs to carry out inter-tank transfers. In this activity the Specs of two different grade products are blended and the specs of the mixed product emerge different from the specs of cargo transferred. During the process of inter-tank transfer circulation, churning, heating activity also carried out to have proper blending and homogeneous product at all the levels in the tank. There are specific equipment like churner....
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....urposes of this Act and (iii) earn foreign exchange; 8.6 Further, the rule 76 of Special Economic Zone Rules 2006 defines the services for the purpose of this section 2(z) of the SEZ Act which reads as under: "76. The "services" for the purposes of [1] [clause] (z) of section 2 shall be the following, namely:- Trading, warehousing, research and development services, computer software services, including information enabled services such as back-office operations, call centres, content development or animation, data processing, engineering and design, graphic information system services, human resources services, insurance claim processing, legal data bases, medical transcription, payroll, remote maintenance, revenue accounting, support centres and web-site services, off-shore banking services, professional services (excluding legal services and accounting) rental/leasing services without operators, other business services, courier services, audio-visual services, construction and related services, distribution services (excluding retail services), educational services, environmental services, financial services, hospital services, other human health services, tourism and t....
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....tion of denial of exception us/s 10AA of the Act. The Ld. Counsel for the assessee has placed on record a copy of an order passed by the Jaipur Bench in DCIT Vs. Goenka Diamond & Jewellers Ltd. It appeal No. 509(JP) of 2011 2012(050)- SOT-0307-TJAI in which it has been held that trading of the eligible goods entitles the se to the benefit of section 10AA of the Act. Similarly, the copy of another order passed by Mumbai Bench in M/s Gitanjali Exports Corporation Limited Vs. ADCIT in ITA No. 6947 & 6948/Mum/2011 dated 08-05-2013 has also been placed on record in which the view expressed by the Jaipur Bench has been reiterated. No contrary precedent has been brought to our notice by the Ld. DR. In view of the two Tribunals orders available on the point allowing exemption u/s. 10AA of the Act in respect to 'trading' activities, we are of the considered opinion that no exception can be taken to the view expressed by the Ld. CIT(A) in granting the exemption." 8.9 In this respect we also draw support and guidance from decision of Hon'ble ITAT Jiapur 'B' Bench in case of DCIT vs. Goenka Diamond & Jewellers Ltd. reprted in 19 taxamman.com 91. The relevant extract of the order is reproduc....
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....entrepreneur putting up the units in the SEZ that benefit under section 10AA will be available on trading in the nature of re-export of imported goods. [Para 2.17] Vide Instruction No. 1/2006, dated 24-3-2006 of Ministry of Commerce, it was clarified that trading units can be set up in the SEZ. Further, modification was made on 24-5-2006 in which it was made clear that the deduction under section 10AA will be available in respect of the trading in the nature of re-export of imported goods. Thus the assessees were promised that they will be eligible for deduction under section 10AA in respect of the profit earning on trading of re-export of imported goods. The revenue had not been able to show us that such instruction was not withdrawn or the Board has issued instruction that instruction dated 24- 5-2006 from the Ministry of Commerce will not be applicable for the purpose of allowing exemption under section 10AA. Hence, in view of the doctrine of promissory estoppel, the assessee is entitled to deduction. [Para 2.19] Section 51 of the SEZ Act mentions that notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrumen....