TaxTMI 
TaxTMI 
2022 (3) TMI 1360
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....tial assessment year for claiming exemption under Section 80-IC of the Act was taken as assessment year 2010-11. The Assessing Officer, vide its order (Annexure P-1), came to the conclusion that the assessee was not entitled to claim any benefit under Section 80-IC of the Act, as Unit-III was not a new Unit and it was re-construction of an existing Unit-II. 3. Aggrieved against the orders passed by the Assessing Officer, assessee filed appeals before the Commissioner of Income-tax (Appeals), Shimla. 4. The Appellate Authority also came to the conclusion that the assessee was not entitled to claim deduction under Section 80-IC of the Act, as the Unit-III did not have an independent existence. The Appellate Authority held that the Assessing Officer had rightly held that the operation of Unit-III was nothing but an extension of operation of Unit-II. 5. Thereafter, assessee preferred appeals before the Income Tax Appellate Tribunal (hereinafter referred to as the "Tribunal" in short) and the Tribunal vide its impugned order dated 02.11.2018, allowed the appeals filed in ITA Nos.330 to 332/CHD/2018 & ITA No.427/CHD/2018 and partly allowed the appeal in ITA No.428/CHD/2018. Hence, the....
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....its form but not in substance. It may be new in name only. Such an undertaking would obviously not be entitled to the benefit. In between the two there may be various other situations. The difficulty arises in such cases. For instance a new company may be formed, as was in this case a fact which could not be disputed, even by the Income Tax Officer. But tools and implements worth Rs. 3,500 were transferred to it of previous firm. Technically speaking it was transfer of material used in previous business. One could say as that vehemently urged by the learned counsel for the department that where the language of statute was clear there was no scope for interpretation. If the submission of the learned counsel is accepted then once it is found that the material used in the undertaking was of a previous business there was an end of enquiry and the assessee was precluded from claiming any benefit. Words of a statute are undoubtedly the best guide. But if their meaning gets clouded then the courts required to clear the haze. Sub-section (2) advances the objective of sub-section (1) by including in it every undertaking except if it is covered by clause (i) for which it is necessary that it....
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....rtain spare parts necessary as components to completion of the end-product are now manufactured in the business itself. The fact that the assessee is carrying on the general business of heavy engineering will not prevent him from setting up new industrial undertakings and from claiming benefit under section 15C if that section is otherwise applicable. However, in order to be entitled to the benefit under section 15C, the following facts have to be established by the assessee, subject always to time-schedule in the section :-- (1) investment of substantial fresh capital in the industrial undertaking set up, (2) employment of requisite labour therein, (3) manufacture or production of articles in the said undertaking, (4) earning of profits clearly attributable to the said new undertaking, and (5) above all, a separate and distinct identity of the industrial unit set up. We may add that there is no bar to an assessee carrying on a particular business to set up a new industrial undertaking on account of which exemption of tax under section 15C may be claimed. The legislature has advisedly refrained from inserting a definition of the word 'reconstruction' in the Ac....
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....108148 Bharti Airtel - Mohali 5820103 Bharti Airtel - Kolkata 125176 Bharti Airtel - Delhi 1428765 Idea Cellular Ltd 11223942 MTNL-Delhi 3865460 RCIL-Mumbai 121567046 Tata Teleservices Ltd., Mumbai 25859599 Total 34,38,23,527 UNIT-III Clients Unit III - invoiced amount (Rs.) Aircel Lad 1061050 Hungama Debtor 4002574 MTNL-Mumbai 258361 Shortformats Digital Productions Pvt. Ltd. 1469686 AMA India Consultants Income 610786 Federation of All India Aluminum Utensils Manufac 18000 The Tribune Trust 200000 Total 17,169,557 ....." 12. It was the case of the assessee before the Tribunal that earlier the Company was giving services in relation of one product, i.e. voice chat to its clients, like Airtell, Reliance, Idea & Tata. Since the business of the company had grown, it found it necessary to start a new Unit with a view to expand its area of service and consequently, a separate Unit was started, giving services to other Non-Telco Companies/Clients in the field of Information, Technology and Software Services. The office building, where Unit-III had been started, was earlier registered office of the company, whereas, Unit-II was bein....