Itxa/2351/2009 Of The Commissioner Of Income Tax -9, Mumbai v. M/S Waman Industrial Chemicals Ltd. , Mumbai

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.2351 OF 2009 The Commissioner of Income Tax ..Appellant. V/s. M/s. Waman Industrial Chemicals Ltd.(Now amalgamated with Excel Industries Ltd.)..Respondent. Mr. J.S. Saluja for appellant. Ms. Vsanti B. Patel for respondent. CORAM : DR. D.Y.CHANDRACHUD AND J.P.DEVADHAR, JJ. DATED : 4TH FEBRUARY, 2010 P.C. :- 1.The following substantial questions of law have been raised in the apeal by the revenue against the judgment of ITAT dated 14th May, 2008 pertaining to assessment year 2001-02:- a)Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in directing the Assessing Officer to allow deduction u/s.80IA of the Act of Rs.75.63 lac without appreciating the fact that the assessee failed to establish proof of installation of Plant & Machinery ? Tribunal was justified in law in directing the Assessing Officer to allow deduction u/s.80IA of the Act of Rs.75.63 lac without appreciating the fact that the assessee failed to establish proof of installation of Plant & Machinery ? b)Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in directing the Assessing Officer to include Rs.7.64 crores being processing charges received for doing job work for others, in the profits eligible for deduction u/s.80IA of the Act, without appreciating that deduction was admissible to assessee only in respect of the profits 'derived from' an industrial undertaking which manufactured or produced an article or thing in assessee's own right and not on income arising from job work done for others ?Tribunal was justified in law in directing the Assessing Officer to include Rs.7.64 crores being processing charges received for doing job work for others, in the profits eligible for deduction u/s.80IA of the Act, without appreciating that deduction was admissible to assessee only in respect of the profits 'derived from' an industrial undertaking which manufactured or produced an article or thing in assessee's own right and not on income arising from job work done for others ? 2.In so far as the first question is concerned, the Tribunal has relied upon its order dated 27th August, 2003 in the case of the same assessee for assessment year 1996-96. The Tribunal has observed that earlier M/s. Waman Industries (predecessor of the assessee) was running the industrial undertaking for a period of two years as on 30th March, 1994. The partnership firm was converted into a Company with effect from 30th March, 1994 and the assessment year 1995-96 was the third year of the claim for deduction under section 80IA. The order of the Tribunal for assessment year 1995-96 was accepted by the revenue and a statement to that effect was recorded by a Division Bench of this Court in its order dated 10th November, 2009 [Notice of Motion No.3095 of 2009 in Income Tax Appeal (L) No.1329 of 2008]. The Tribunal, therefore, relied upon the order for assessment year 1995-96 which has been accepted by the revenue, as recorded in the earlier proceedings. Consequently, we do not find that any substantial question of law will arise so far as the first aspect is concerned. 3.In so far as the second question is concerned, the Tribunal has once again relied upon its order in the case of the same assessee for assessment year 2000-01 dated 21st August, 2007. The Tribunal held that the assessee had earned certain income for doing job work for others and since the income was derived from the industrial undertaking, it was eligible for deduction under section 80IA. It may be noted that the order of this Court dated 10th November, 2009 in Commissioner of Income Tax V/s. Waman Industrial Chemicals Ltd. (supra) pertains to assessment year 2000-01, in which the aforesaid finding was arrived at by the Tribunal. In 3.In so far as the second question is concerned, the Tribunal has once again relied upon its order in the case of the same assessee for assessment year 2000-01 dated 21st August, 2007. The Tribunal held that the assessee had earned certain income for doing job work for others and since the income was derived from the industrial undertaking, it was eligible for deduction under section 80IA. It may be noted that the order of this Court dated 10th November, 2009 in Commissioner of Income Tax V/s. Waman Industrial Chemicals Ltd. (supra) pertains to assessment year 2000-01, in which the aforesaid finding was arrived at by the Tribunal. In view of the aforesaid position, no substantial question of law would arise, particularly having regard to the facts noted earlier. The appeal is accordingly dismissed. (J.P.DEVADHAR, J.) (DR. D.Y.CHANDRACHUD, J.)