TaxTMI 
TaxTMI 
2024 (7) TMI 150
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....e Income Tax Act, 1961?" 3. The assessment years involved in the above-noted six income tax appeals are as under:- Sl. No. Income Tax Appeal Number Assessment Year 1. ITA/51/2019 2007-08 2. ITA/55/2019 2008-09 3. ITA/52/2019 2009-10 4. ITA/53/2019 2010-11 5. ITA/54/2019 2011-12 6. ITA/57/2019 2012-13 4. The impugned common order dated 31.08.2018 has been passed by the Income Tax Appellate Tribunal, Kolkata, 'B' Bench, Kolkata in ITA Nos. 1962 to 1966/Kol/2016 (assessment years 2007-08, 2008-09, 2009-10, 2011-12 and 2012-13). The above-noted ITA/53/2019 arises from the impugned order dated 25.01.2019 in ITA No. 48/Kol/2016 (assessment year 2010-11) passed by the Income Tax Appellate Tribunal, Kolkata, 'A' Bench, Kolkata, in which the ITAT has followed its above-noted impugned order dated 31.08.2018 passed in respect of the above-noted five assessment years. In the impugned order, the ITAT has also noted that common questions of fact and law are involved in all the appeals and accordingly, the ITAT heard all the five appeals together and one appeal separately following its common order. All the aforesaid six appeals were filed by the Revenue before the ITAT ch....
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.... which was rejected by the Assessing Officer on grounds, firstly, that the process applied by the assessee does not amount to manufacturer and secondly, the product of the assessee does not find mention in Schedule 14. Aggrieved with the assessment order, the assessee filed separate appeals before the Commissioner of Income Tax (Appeals) which were allowed and it was held that the process applied by the assessee amounts to manufacture and the assessee is entitled for deduction under Section 80-IC (2) (a) of the Act, 1961. Aggrieved with the orders of the Commissioner of Income Tax (Appeals), the revenue filed separate appeals before the Income Tax Appellate Tribunal, which have been allowed by the impugned orders. 11. In the impugned orders, the ITAT held that the process applied by the assessee is manufacture but the product of the assessee shall stand excluded for deduction in view of part B of the Thirteenth Schedule to the Act, 1961. The conclusion/findings recorded by the ITAT in the impugned order are reproduced below:- "... We adopt the above detailed discussion mutatis mutandis to decline Revenue's first and foremost plea qua "manufacturing" aspect to conclude that t....
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....ips further in invoked "Golden Rule" of interpretation that the words of a statute must prima facie to be given their ordinary meaning. We find it very much relevant at this stage that their lordships yet another judgment in Smt. Tarulata Shyam v (1977) 108 ITR 345 (SC) also made it clear that it is the fundamental rule of taxation that where there is no scope for importing into the statute words which are not there, such an important word would be not to construe but to amend the statute. And also that even if there is any casus omisus, the defect can be remedied by the legislation alone and not by judicial interpretation. 12. We keep in mind all these settled legal principles to avert to the taxpayer's impugned section 80IC deduction claim. There is hardly any dispute by now that it has manufactured "pan masala" in its specified unit situated in Sikkim state. Its claim throughout was that "pan masala" is covered in 7th Item Part-B in the Fourteenth Schedule (applicable for the stare of Sikkim) to be "Food processing including agro-based industries, processing preservation & food packaging of fruits and vegetables (excluding conventional grinding/ extraction units). We are ....
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....claim fails to clear the rigor of the above negative list in Thirteenth Schedule Part-1 Item No. 1 applicable for Sikkim. We further are of the view that an item covered in the negative list cannot be held to have been simultaneously included in the positive is as such an interpretation would lead to absurdity in interpretation of the two limbs of section 80IC deduction provision. We accordingly restore Assessing Officer's action making assessee's deduction claim of Rs.436,98,603/ ... assessment year 2007-08." Submissions:- 12. Learned Counsel for the assessee/appellant submits as under:- i) It is admitted case that the provision applicable to the assessee is Section 80 (2) (a) (i) of the Act, 1961. Assessee's unit was situated in the notified area which started manufacturing with effect from 27.06.2006. ii) The product manufactured by assessee does not fall under any of the items in Part A of Thirteenth Schedule to the Act, 1961. iii) Tribunal has read Part B of Thirteenth Schedule which is applicable to the State of Himachal Pradesh and State of Uttaranchal, whereas Part A is relevant for the State of Sikkim where the unit of the assessee was established in a n....
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....e with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains, as specified in sub-section (3). 2) This section applies to any undertaking or enterprise,- (a) which has begun or begins to manufacture or produce any article or thing, not being any article or thing specified in the Thirteenth Schedule, or which manufactures or produces any article or thing. not being any article or thing specified in the Thirteenth Schedule and undertakes substantial expansion during the period beginning- (i) on the 23rd day of December, 2002 and ending before the 1st day of April, [2007], in any Export Processing Zone or Integrated Infrastructure Development Centre or Industrial Growth Centre or Industrial Estate or Industrial Park or Software Technology Park or Industrial Area or Theme Park, as notified by the Board in accordance with the scheme framed and notified by the Central Government in this regard, in the State of Sikkim; or (ii) on the 7th day of January, 2003 and ending before the 1st day of April, 2012, in any Export Processing Zone or Integrated Infra-structure Development Centre or In....
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.... to manufacture or produce any article or thing not being any article or thing specified in the 13th Schedule. Therefore, clause (a) of sub-Section (2) of Section 80IC is applicable to any undertaking or enterprise established in an area notified by the Central Board of Direct Taxes to manufacture or produce any article or thing except those specified in the 13th Schedule. Part-A of the 13th Schedule is applicable for the State of Sikkim, whereby tobacco and tobacco products (including cigarettes, cigar, gutkha etc.), aerated branded beverages and pollution causing paper and paper products have been excluded. Except these items any undertaking or enterprise established in a notified area within specified dates to manufacture or produce any article or thing, is eligible for deduction under Section 80IC (3) of the Act, 1961. Entry-1 of Part-B of the 13th Schedule applicable to the State of Himachal Pradesh and State of Uttaranchal, provides the article or thing "tobacco or tobacco products including cigarettes and pan masala". The word 'pan masala' used in Entry 1 of Part B is not incorporated in Part-A of the 13th Schedule (for the state of Sikkim). Once the Legislature has not incl....