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TaxTMI 
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TaxTMI 
2021 (8) TMI 569
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....y the Income Tax Appellate Tribunal, Chennai, "B", "A" and "A" Benches, respectively. 2.The appeals were entertained to decide the following substantial questions of law : "T.C.A.No.230 of 2010 : 1.Whether on the facts and circumstances of the case, the Tribunal is right in deciding that the Assessee is entitled to the benefit of deduction under Section 10-B of the Act? 2.Whether on the facts and circumstances of the case, the Tribunal is right in not considering the amendment of Sec.10B by omitting cl(iii) of explanation to sub section 7 of the Act? 3.Whether on the facts and circumstances of the case, the order of the Tribunal passed contrary to the case law 251 ITR 323 (SC) is valid?" T.C.A.No.279 of 2011 : Whether on the fa....
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....o placed before the Assessing Officer to justify the said claim. The Assessing Officer proceeded to consider the matter by observing that, what is required to be decided is whether the assessee is engaged in the manufacture or production of an article or thing. After taking note of various factors, the Assessing Officer held that the assessee is not engaged in manufacture of any article or thing, within the meaning of Section 10-B of the Act, as is applicable in respect of the Assessment Year under consideration. Accordingly, the claim for deduction was rejected. 6.The assessee preferred an appeal before the Commissioner of Income Tax (Appeals)-XII, Chennai ("CIT(A)" for brevity). The appeal was allowed by order dated 31.12.2008. Aggrieve....
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....on of Section 2 (29BA) of the Income Tax Act, was not there. So too, sub-section (7) sub-clause (iii) of Section 10B of the Income Tax Act, defining 'manufacture' was not there. Nevertheless, we may note that in the case of Gem Granites v. CIT [2004] 271 ITR 322/141 Taxman 528 (SC), the Supreme Court considered the issue of polishing granites and held the same is different from rough granites and that rough granites under the process as amounting to manufacture. Thus, when the resultant article no longer retained its original character, but has a different name and character, we do not find any justifiable ground to accept the plea of the Revenue solely by the reason of the absence of definition of 'manufacture' under Sectio....
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....ring Co. reported in (2001) 249 ITR 307 SC. On going through the said decision, we find that the question was whether cutting and polishing of diamond amounts to manufacture or production of goods. Taking into consideration the factual position, the Court held that, raw and uncut diamond is subjected to process of cutting and polishing which yields polished diamond and the polished diamond cannot be treated to be a new article, because in the said case, there was no material on record upon which such a conclusion can be arrived at and therefore, the case was decided in favour of the Revenue. In the case on hand, the CIT(A) had elaborately examined the process through which the quarried rough stone goes through before it becomes a polished ....
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....nt. The operative portion reads as follows : "11.The main judgment on which the Department has placed reliance is the judgment of this Court in Lucky Minmat (P) Ltd. v. CIT [2000] 245 ITR 830. In that case, the following question came up for consideration before the Tribunal: "Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that business activity of the assessee was in the nature of manufacturing or production so as to be entitled for relief under section 80HH of the Income-tax Act, 1961." The assessee in that case had the business of mining of limestones and marble blocks which thereafter were cut and sized before being sold in the market. It was held by this Court that the assessee wa....