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TMI Blog2014 (11) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... ring of any article or thing - All conditions laid down in Section 80-IB of the Act stands satisfied - Central Excise authorities recognizes the assessee as manufacturer and is collecting Excise Duty from the Assessee for manufacture of excisable goods. The Central Excise Authorities recognizes assessee as manufacturer and is collecting Excise Duty for manufacture of excisable goods for carrying out the operation of fitting, mounting and soldering of raw materials/components at the factory of the Job Worker under close supervision and monitoring by the employees of the assessee, further processing, burning and testing shall be carried out at the factory of the assessee, whereby and whereto a product will emerge which is having distinct Identity in the commercial world – assessee is eligible for deduction u/s 80-IB – Decided in favour of assessee. - I.T.A No.1589/Kol/2009 - - - Dated:- 13-8-2014 - Shri Mahavir Singh Shri Shamim Yahya, JJ. For the Appellant : Shri Soumitra Chowdhury For the Respondent : Shri P. B. Pramanic, JCIT ORDER Per: Mahavir Singh: This appeal by assessee is arising out of order of CIT(A)-V, Kolkata in Appeal No. CIT(A)-V/Kol/19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y are based on customer specification. Voltage, colour of lights, AC/DC varies from customer to customer. As a sequel to that manufacturing process depends on drawing and designing of Circuit. In fact and in effect drawing and designing of circuit is the most basic factor upon which the product is developed according to customer specification. This vital aspect of production process is carried out by the assessee. The next part of the production process is sub-assembly and soldering. This part of the work is carried out by the Job Worker/Processor who is being paid processing charges. The work entails filling, mounting and soldering of raw materials/components in Circuit Board. The operation to such effect is carried out under the supervision of the employees of the assessee at the factory of the job workers. Extensive lest thereof is also carried out by the employees of the assessee to ensure fitting, mounting and soldering or requisite raw materials/components in purchase of the circuit designed. The Circuit Board fitted and mounted with raw materials/components are then brought to the factory of the assessee situated at 44, Armernian Street Kolkata. Terminals and A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the reason that the details of processing/manufacturing were never produced before the AO and hence, Tribunal set aside the matter back to the file of AO by observing in para 7 of the order as under: 7. Heard both the parties, perused the records and find that the processes of manufacturing undertaken by the assessee company were not brought to the notice of the lower authorities by the assessee and, therefore, we treat these details of processing/manufacturing as new evidence produced by the assessee before us. Since these details of processes or manufacturing were not before the Assessing Officer, we deem it proper to restore the matter back to the file of the Assessing Officer for fresh adjudication who shall verify the same after affording proper opportunity of being heard to the assessee. Therefore, this ground of appeal is allowed for statistical purposes. 4. It was informed by Ld. Sr. DR that the AO, in term of Tribunals directions for the assessment year 2002-03, examined the issue afresh and again disallowed the deduction and now matter is pending before CIT(A) in second round. The AO relying on the earlier year s assessment order disallowed deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade by AO is confirmed. Aggrieved, now assessee is in appeal before us. 6. We have heard rival submissions and gone through facts and circumstances of the case. We find that the Assessee is a small-scale industrial undertaking having Permanent Registration No.30325068/Sl dated 18.08.1997 and obtained Excise Licence having R. C. No.20/M/8/C/9 Cal- E/97 dated 06.06.1997 which has presently been changed to AABCB2719DXM001. The assessee claimed before us that the manufacturing activities carried out are having following twelve stages: (1) Drawing and designing of Circuit (2) Development of Circuit Board / Product accord ng to customer specification. (3) Assembling of requisite raw materials. (4) Mounting / Soldering of some components in Circuit Board. (5) Testing of circuits as to whether the mounting and soldering are as per specimens of circuit designed. (6) After being fully satisfied about the job work, other components are fitted in the Circuit board. (7) Terminals and Adapters are thereafter fitted and mounted. (8) The Circuit Board fitted and mounted with various components are passed through Several chemical applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se Duty and is filing monthly/quarterly returns to the Excise Authorities. The Assessee being manufacturer, is under obligation to comply with all such statutory formalities. 8. This issue has been dealt by Hon ble Supreme Court in the case of Ujagar Prints Vs. Union of India (1989) 179 ITR 317 (SC), wherein it has been held as under: We have carefully considered these submissions. In Empire Industries' case [1986] 162 ITR 846, this court considered similar submissions in an almost identical context and situation. Learned judges referred to the observations of this court in CST v. Harbilas Rai and Sons [1968] 21 STC 17, in which the view expressed by the Division Bench of the Madhya Pradesh High Court in Hiralal Jitmal v. CST [1957] 8 STC 325, 326, was held supportable on the reasoning that (see [1986] 162 ITR 846, 862) .... The decision of the Madhya Pradesh High Court might perhaps be justified on the ground that a printed or dyed cloth is commercially a different article from the cloth which is purchased and printed or dyed. The Division Bench also referred to, with approval, the decision of the Bombay High Court in Kores (India) Ltd. v. U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f bleaching, dyeing, sizing, printing, finishing, etc., emerges as a commercially different commodity with its own price structure, custom and other commercial incidents and that there was in that sense a manufacture within the meaning of section 2(f), even as unamended, is an eminently plausible view and is not shown to suffer from any fallacy. Indeed, on this point, the referring Bench did not disagree or have any reservations either. It is to be noticed that if the amending law is valid, this aspect becomes academic. 9. We find that monitoring and soldering of raw materials/components on Circuit Board as performed by Job Worker is only one part of the manufacturing activities has not resulted towards emergence of any product which has commercial identity and is excisable. It was not considered by the Assessing Officer that had such work performed by Job Worker resulted into emergence of a product having commercial identity, then such work would have attracted the Excise Act. The product that of Aviation obstruction Light (AOL), push Buttons, Modules and Line Tester emerged as Finished goods having commercial identity from consumption of Raw Materials, viz, Adapter, Resista ..... X X X X Extracts X X X X X X X X Extracts X X X X
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