9911796707
TMI Blog2004 (12) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... set up a new project No. 2 for manufacturing of 4 inches diameter pipes by converting into a private limited company it amounts to splitting up or reconstruction of a business already in existence and, therefore, the respondent is not entitled to claim the benefit under sections 80J and 80HH. The Tribunal has found that the respondent has set up a new project for manufacturing of 4 inches diameter black pipe which is different from manufacturing 2 inches diameter black pipe by the respondent. Merely because some of the facilities are common that will not mean reconstruction or splitting up. We are of the considered opinion that the Tribunal has correctly applied the principle laid down by the apex court in Textile Machinery Corporation Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollows: 5. The respondent-assessee is a private limited company and is engaged in the business of manufacture and sale of black steel rubes and galvanised steel tubes. Earlier it was a partnership firm which was converted into a private limited company. It had set up a project called project No. 2 consisting of a milling plant for manufacture of steel tubes of 4 inches diameter. Previously it was manufacturing such tubes only of 2 inches diameter. The respondent had claimed 71/2% of the capital employed in the project No. 2 amounting to Rs. 18,41,349 after deduction of loans from UPFC and PICUP. The respondent claimed relief under sections 80J and 80HH of the Act. The Income-tax Officer in order to verify the factual position inspected the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peal the Tribunal has held that the new project of the respondent is a new industrial unit, which is separate physically from the old one, the capital of which and the profits thereon are ascertainable. The Tribunal was, however, of the view that merely because some of the processes for the manufacture of new tubes are carried on with the help of the old machines or there is common store room and common factory office are not fatal to the claim of the respondent. The Tribunal while coming to the aforesaid conclusion had relied upon a decision of the apex court in the case of Textile Machinery Corporation Ltd. v. CIT [1977] 107 ITR 195. 7. We have heard Sri A.N. Mahajan, learned standing counsel for the Revenue, and Sri Shakeel Ahmad, learne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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