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TMI Blog2012 (10) TMI 411X X X X Extracts X X X X X X X X Extracts X X X X ..... incurred wholly and exclusively for the purpose of the business and accordingly the ground raised by the assessee dismissed - against assessee. - I.T.A. Nos.479, 480 & 481/Mds/2012 - - - Dated:- 28-8-2012 - Dr. O. K. Narayanan, And Shri V. Durga Rao, JJ. Appellant by: Shri H. Padamchand Khincha, CA Respondent by : Shri T.N. Betgeri, JCIT O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: These appeals by the assessee are directed against the consolidated order dated 23-12-2011 passed by the CIT(Appeals)-XII, Chennai for the assessment years 2000-01, 2001-02 and 2002-03. 2. In these appeals the assessee filed return of income before the Assessing Officer claiming deduction under section 80-IA of the Income Tax Act, 1961 ( the Act for short). The Ao rejected the acclaim on the ground that the assessee does not come under the purview of sec. 80-IA. The assessee carried the matter before the CIT(A). It was submitted before the learned CIT(A) that inadvertently the claim of deduction was madeu u/s 80-IA. In fact it is a deduction claimed under sec. 80-IB of the Act for the assessment year 2000-01 onwards. The CIT(A) confirmed the order of the AO on the ground that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... data or material given by the author for typesetting. This is a kind of raw data which cannot be used by any reader as in the form of book. This raw data given by the author undergoes the following processes : 1. Data entry process tagging. 2. Copy Editing Editorial proof reading. 3. Composition pagination process. 4. Graphic Art either use as it is or redraw. 5. Proof reading Quality check. 6. Indexing. 7. Front and back end matters and cover design. 8. Creation of deliverables electronic and/or Hard copy. The services detailed above are in the nature of data processing activities. The nature of the activities carried on by the appellant amounts to manufacture of an article or a thing. The AO after considering the above submissions of the assessee has observed that regarding manufacturing activities of the assessee, after visiting the assessee s factory to get versant with the full details of the activities of the assessee-company, it is understood that the assessee is receiving the manuscript in paper form and after subjecting the same into typesetting, indexing, pagination, etc. delivers in electronic and or hardcopy to the suppliers/authors. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see is eligible for deduction u/s 80-IB(3) of the Act. He relied on the paper book page No. 266 to 270 and submitted that by carrying out the above process the assessee is manufacturing hard disc/electronic media. The learned counsel for the assessee further submitted that the assessee has used the raw material for the purpose of the production and for that he relied on page 13 of the paper book. The learned counsel for the assessee further relied on section 2(29BA) of the Act and circular No. 5 of 2010 dated 03-06-2010. The learned counsel for the assessee further relied on the decisions in the cases of CIT v. Oracle Software India Ltd. (320 ITR 546) (SC); CIT v. Apollo Hospital Enterprises (338 ITR 68) (Mad) and CIT v. HLS India Ltd. (Now HLS Asia Ltd.) (335 ITR 292) (Del). 8. On the other hand, the learned DR has submitted that the assessee receives a manuscript and converts it into a hard disc or electronic media. This does not amount to manufacturing or producing an article or thing. Therefore, the assessee is not eligible for deduction u/s 80-IB of the Act. Manufacturing means the outcome should be something different. Here the assessee is not bringing anything new. Rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c constitutes manufacture or processing of goods . The facts considered by the Hon'ble Supreme Court in the above case are entirely different from the facts involved in the present case. Therefore the above decision relied upon by the learned counsel for the assessee has no application to the facts in the present case. 11. Insofar as the decision relied upon by the learned counsel for the assessee in the case of Apollo Hospital Enterprises (338 ITR 680 (Mad) is concerned, the Hon ble jurisdictional High Court has considered whether the assessee is entitled to investment allowance in respect of X-ray, ultra sound, angiography, gamma camera, stress analysis equipment etc. and by following various decisions of the High Courts held that hospital and individual doctors are engaged in commercial activity and therefore the assessee was treated as an industrial undertaking and also engaged in manufacture or production of any article or thing. 12. In the present case, the assessee was transferring the data/information from paper medium to electronic medium. There is no change in the content and it is not producing any new thing or article. Therefore it cannot be said that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n his order the learned CIT(Appeals) has observed that no details were filed with regard to the foreign travel to show that the expenses were incurred wholly and exclusively for the purpose of the business and accordingly he dismissed the ground raised by the assessee. 17. Aggrieved, the assessee has carried the matter before the Tribunal. Even before us no material has been filed to show that the foreign travel expenses incurred for others were exclusively for the purpose of the business of the assessee, except stating that these expenses were incurred for the purpose of the business. We therefore find no reason to interfere with the orders of the authorities below. Accordingly, this ground raised by the assessee is dismissed. 18. For the assessment year 2002-03 the assessee has raised a similar ground of disallowance of foreign travel expenses to the tune of Rs. 1,12,806/-. Neither before the Assessing Officer nor before the learned CIT(Appeals) the assessee has filed any details. Even before us nothing has been filed. For the reasons stated in paragraph 17 of this order above for the assessment year 2000- 01, we dismiss this ground raised by the assessee. 19. For the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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