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TMI Blog2015 (3) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Thus we reverse the order passed by Ld. CIT(A) and hold that the machinery installed by the assessee was new and as no other condition for grant of deduction under section 80 IB has been held to be violated by the assessee, the assessee is entitled to get deduction under section 80 IB. - Decided in favour of assessee. - ITA NO.8391/MUM/2011, ITA NO.8392/MUM/2011, ITA NO.6957/MUM/2012, ITA NO.8393/MUM/2011, ITA NO.8394/MUM/2011 - - - Dated:- 25-2-2015 - Shri I.P. Bansal And Shri Chandra Poojari JJ For the Appellant : Shri Hari S. Raheja For the Respondent by : Shri Asghar Zain ORDER Per I.P.Bansal, JM: All these appeals are filed by the assessee being legal heir of K.H.P Shetty In all these appeals the assessee is contesting non-granting of deduction under section 80 IB of the Income Tax Act, 1961 (the Act). Grounds of appeal in all these appeals are identical except difference in figures. For assessment year 2004- 05 the grounds of appeal read as under: 1. On the facts circumstances of the case the Ld. Commissioner of Income Tax (A) erred in confirming the disallowance of deduction u/s. 80 IB of ₹ 9,66,204/- on the ground/s as containe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reviously used for any purpose; (iii) (iv) . There are four sub clause under subsection (2) providing various conditions, which are required to be cumulatively satisfied. Amount them, the clause (ii) provides for the condition that the industrial undertaking is not formed by the transfer of machinery or plant previously used for any purpose. As the deduction is claimed by the assessee, undoubtedly, the onus is on the assessee to provide the relevant basis facts, which are reliable and stand the test of the scrutiny. 9. Considering this legal position as well as the facts of the case,, for resolving the present dispute, we need to understand the following parties. They are: (i) the manufacturer or fabricator or supplier of the new machinery or plant; and (ii) the assessee, who purchased, installed and used the same for his business purposes. It is not clear from the facts of the case, if the alleged machinery or plant purchased is directly manufactured by the supplier or not. If the supplier is also a fabricator, he must be having a factory premises for fabrication and manufacture of the alleged machinery. So far as the suppiers are concern, it is fact that they are n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the machinery or plant in question is the one previously used for any purpose. AO has held it so by inference and that to when the assessee has failed to substantiate that the same is not the one previously used and the assessee has failed to produce the supplier before him for examination. Further it is relevant to mention that the initial onus is on the assesse to evidence that he has fulfilled the specified conditions by filing the relevant verifiable or credible information. Then, it is the duty of the AO to verify the veracity of the said details and information. In case the information so supplied is found unverifiable, the assessee has to co-operate with the AO in establishing the bona fide of the transactions. 12. In the light of the above, considering the non traceable supplier, we are of the opinion, that while the AO has not completed the investigation, the assesse has failed to discharge the onus to demonstrate that the assessee has fulfilled the conditions specified in clause (ii) above. The CIT (A) has missed to adjudicate the core issue of discharging of the onus in the impugned order. In the process, the relevant basic particulars such who designed fabricate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the time of commencement of the business. 1. Copy of the purchase invoice no.218/03-04 dated 01-10-2003 from M/s. Manasi Trading Put. Ltd. for ₹ 6,08400/-. It is to be mentioned here that the B.S.T and C.S.T Nos. are mentioned in the said invoice. These prove that the supplier was assessed to sales tax. M/s.Manasi Trading Put. Ltd is a trading Company and not the manufacturer hence the excise registration number is not mentioned in the invoice. A copy of the C form is also enclosed which confirms the machinery is assessed to sales tax. Confirmation letter dated 14-11-2006 from M/s. Manasi Trading Put. Ltd is enclosed for your ready reference which reconfirms that they have supplied new machinery to us. 2. Copy of the transport bill issued by Bright Transport Co is enclosed in support of the transportation of the machinery to our premises in Silvassa. 3. Copy of the installation certificate dated 04.10.2003 issued by M/s. Ronak Electronics. The said report confirms installation and wiring work of the machinery was completed on 03.10.2003. 4. Copy of the loading/unloading bill no. 158/04 dated 02.10.2003 issued by Vijay D Mishra (loading / unloading contractor). T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reviously submitted. The primary onus is on the assessee to establish that the machinery purchased and installed by him is new and never been used by any other person prior to the usage by the assessee. The evidences produced by the assessee are summarized as under: i. Regarding first issue who Designed and fabricated the alleged machinery , assessee could not prove and discharged its onus as assessee stated that M/s.Manasi Trading Put. Ltd is a trading Company and not the manufacturer. Due to insufficient data and onus is on assessee to provide name and address of the manufacturer, assessee could not prove the newness of machinery which can be verified by the date of manufacture of the machinery. The newness of machinery could not be established on this fact. 2. Whether the machinery is assessed to Excise duty and Sales tax. The asseee stated hat M/s.Manasi Trading Pvt. Ltd is a trading Company and not the manufacturer hence the excise registration number is not mentioned in the invoice. A copy of the C form is also enclosed which confirms the machinery is assessed to sales tax. The assessee has furnished the Sales tax details of M/s. Manasi Trading Pvt. Ltd. along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 Thus, the AO has held that the documentary evidence submitted by the assessee does not support the contention that the machinery purchased by the assessee was new and again disallowance has been made which is confirmed by Ld. CIT(A). The assessee is aggrieved, hence, has filed aforementioned grounds of appeal. 4. Ld. AR after narrating the facts, drew our attention towards submissions made before AO vide letter dated 16/10/2009, copy of which is filed at pages 96- 97 of the paper book. Along with the said letter following evidences were filed. 1. Copy of the bill for new machine purchased from Manasi Trading Pvt. Ltd. 2. Copy of lorry receipt for transportation of machinery to Silvassa. 3. Copy of bill for unloading and lifting of machine to the premises. 4. Copy of Installation certificate issued by the machine installer. 5. Copy of letter issued by the Bharat Co-op. Bank Ltd., regarding credit facility availed from them for new machineries purchased and payment made to suppliers. 6. Copy of Bank Statement in support of clearing of cheques in favour of Suppliers of new machineries. 7. Copy of SSI registration certificate issued by Dep. Of Industry, Dep. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued by Vijay D. Mishra dated 2/10/2003, which is regarding installation of the machinery on the billed address has also been mentioned. At page 103 of the letter issued by M/s. Ronak Electronics dated 4/10/2003, mentioned that on 3/10/2003 installation was done along with necessary wiring for Motor Heater and Thermocouple between panel and machinery. At page 104 to 108, copy of application for obtaining permanent registration as SSI unit. At page 115 copy of letter dated 21/12/2009 written by the bank to the AO. It will be relevant to reproduce the contents of the above letter, which are as under: To Dr. Pamod Sahakar, Income Tax Officer, Ward 23(2)-4, Mumbai. 205-C-10, Pratyaksha Kar Bhavan, 2nd Floor, Bandra Kurla Complex, Bandra (East), Mumbai 400 051. Sir, SUB: Sanction of Term Loan towards purchase of New Machinery to Shri K.H.P. Shetty Proprietor of Siddharth Plastics) Ref: Your Letter No.ITO 23(2)-4/KHPS/2009-10 dated 07.12.2009. Kindly refer to the above We have received your above referred letter on 18th December, 2009, in this regard we have to state that before sanction of Term, Loan to Shri K.H.P. Shetty (Proprietor of Siddharth Plastic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction. 6. We have heard both the parties and their contentions have been carefully considered. Right from beginning, it is the case of the assessee that the machinery installed in its premises is new. It is because that assessee could not produce the parties from whom the assessee had purchased these machinery, the Revenue is doubting about the newness of the impugned machinery. The evidence furnished by the assessee to support its contention that machinery is new includes evidence from the agencies which cannot be said to be interested parties who will support the contention of the assessee. One of such evidence is in the shape of certificate given by the Department of Industries, vide their certificate dated 23/2/2007. It has clearly described that certificate of permanent SSI Registration to the assessee was granted after due verification of the required guideline and the machinery installed by assessee is new machinery. Copies of such certificates have been filed at pages 95 to 109 of the paper book and also reproduced above. If it is the case of the Revenue that such certificate was wrong, then Revenue could examine the signatory of the said letter, who is General Mana ..... X X X X Extracts X X X X X X X X Extracts X X X X
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