2010 (12) TMI 414

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..... VINDRAN P. N. JJ JUDGMENT C. N. Ramachandran Nair J.- This is an appeal filed by the assessee challenging the order of the Income-tax Appellate Tribunal confirming the disallowance of its claim for deduction under section 80-IB of the Income tax Act, 1961. When the appeal was taken up before the Division Bench, the assessee relied on another Division Bench judgment of this court in CIT v. Forbes Ewart and Figgis P. Ltd. [1999] 238 ITR 762, and contended that the said decision, though rendered in the context of the assessee's entitlement for investment allowance under section 32A of the Act, is applicable for considering the eligibility for deduction under section 80-IB of the Act and so much so, the appeal should be allowed by .....

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..... al. 3. The assessee's counsel mainly relied on the decision of the Division Bench of this court in CIT v. Forbes Ewart and Figgis P. Ltd. [1999] 238 ITR 762 and several other decisions, particularly that of the Supreme Court in CIT v. N. C. Budharaja and Co. [1993] 204 ITR 412 and CIT v. Sesa Goa Ltd. [2004] 271 ITR 331 (SC) and contended that these decisions support the claim of the assessee. The standing counsel appearing for the respondent on the other hand submitted that the decision of this court relied on by the assessee is in respect of investment allowance under section 32A and the decisions of the Supreme Court relied on by the assessee are also not in the context of section 80-IB of the Act. 4. The only question to be cons .....

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..... ducts, intermediate products and residual products which emerge in the course of manufacture of goods." 5. What is made clear by the Supreme Court is that even production of intermediary products is sufficient to entitle the assessee for deduction available to new industrial unit. Compound rubber produced by the assessee on job work for the tyre manufacturing companies is an intermediary from which tyre is manufactured. If processing of iron ore which is only raw material for producing iron therefrom, amounts to manufacture or production of any article or thing, then we see no reason why compound rubber cannot be treated as an article produced by the assessee though for the tyre manufacturing company under contract. In other words, ther .....

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