TaxTMI 
TaxTMI 
2021 (8) TMI 569
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...., 1094/Mds/2010 and 1442/Mds/2013, passed by 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....
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.... unit and they are entitled to claim deduction under Section 10-B of the Act. The relevant records were also 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 Incom....
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.....We are conscious of the fact that during the assessment years under consideration 2003-04, 2004-05. 2005-06, the definition 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....
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....ue, placed reliance on the decision of the Hon'ble Supreme Court in the case of Commissioner of Income-Tax v. Gem India Manufacturing 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 ....
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....me Court in Arihant Tiles & Marbles (P) Ltd. (supra) and it was pointed out as to how the important distinction was not noted by the Department. 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 busi....