2016 (8) TMI 1289 - HC - Income Tax

Eligibility to benefit of Sections 80HH, 80-I and 80-IA - whether bottling of LPG is an activity which amounts to production or manufacturing for the purposes of the aforesaid provisions of the Act - Held that - As decided in assessee s own case 2013 (5) TMI 124 - BOMBAY HIGH COURT LPG bottling plant would entitle the assessee to the benefit under Section 80HH, 80I and 80IA of the Act.

Summary

Issues:
- Appeal challenging the common impugned order passed by the Income Tax Appellate Tribunal for Assessment Years 1996-97 and 1998-99.
- Whether bottling of LPG gas into cylinders amounts to production or manufacturing activity for the purpose of Sections 80HH/80I/80IA of the Income Tax Act, 1961.

Analysis:
1. The judgment deals with two appeals challenging the common order of the Income Tax Appellate Tribunal for Assessment Years 1996-97 and 1998-99. The primary issue raised in both appeals is whether the activity of bottling LPG gas into cylinders qualifies as production or manufacturing activity under Sections 80HH/80I/80IA of the Income Tax Act, 1961.

2. The Tribunal's impugned order favored the respondent assessee, citing a previous judgment of the High Court that upheld the Tribunal's decision regarding the manufacturing nature of bottling LPG gas. The Tribunal's decision was based on the premise that the process of bottling LPG makes it marketable, even though no new product is created. This interpretation was supported by the High Court's previous ruling in a similar case.

3. The Revenue, represented by Mr. Suresh Kumar, did not contest the issue during the appeal, acknowledging that the matter had been conclusively settled against them by the High Court's previous decision. Consequently, the questions raised by the Revenue were deemed to lack any substantial legal merit and were not entertained by the Court.

4. As a result, the Court dismissed both appeals, upholding the Tribunal's decision that the activity of bottling LPG gas constitutes manufacturing for the purposes of Sections 80HH/80I/80IA of the Income Tax Act, 1961. No costs were awarded in this matter.

This judgment highlights the importance of legal precedent in tax matters and the significance of prior court decisions in determining the outcome of similar cases. The Court's decision underscores the principle of consistency in legal interpretation and application, especially in tax law.