9911796707
TMI Blog2005 (12) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... parties to supply information relating to the state of affairs pursuant to the impugned notice. On the date of hearing it was informed that hearing was taken but no order has been passed. By my earlier order I also directed to produce the final order passed, if any. The learned counsel for the Revenue submits that he has received information that final order has been passed but he is unable to produce the same. At the ad interim stage there was no material, nor any explanation of the Revenue as to why such notice was issued, or it was not possible at that stage to pass any order granting stay by simple reading of the notice and the petition itself. As the final order has not been passed and now the court has got all the materials, viz., the version of the Revenue as to why jurisdiction under section 263 was exercised, therefore, the court can decide it finally. Dr. Pal, learned senior counsel for the petitioner, contends that exercise of jurisdiction under section 263 of the said Act is pre-conditioned by two eventualities viz. (i) when it considers that any order passed by the Assessing Officer is erroneous and (ii) it is prejudicial to the interests of the Revenue. According t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... btedly engaged in the manufacturing of goods and as such the petitioner was entitled to get the benefit of reduction of rate of tax. In view of the aforesaid factual position the definition of industrial company in the relevant Finance (No. 2) Act of 1980 is satisfied. Consequently investment allowance for the respective assessment years was allowed under section 32A of the said Act. What is manufacturing process has been explained in the decision of the Calcutta High Court reported in Russell Properties P. Ltd. v. A. Chowdhury, Addl. CIT [1977] 109 ITR 229. In the affidavit-in-opposition the aforesaid facts and circumstances having been denied and disputed, no material far less new material has been brought in the affidavit-in-opposition to justify the aforesaid action. He contends further that all kinds of loss of revenue is not the requirement for exercise of jurisdiction but it has to be examined whether the decision is erroneous or not and then whether it is prejudicial to the interests of the Revenue or not. He further contends that following the decision of the Tribunal if the Income-tax Officer has taken a decision such decision cannot be erroneous. He has referred to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous in so far as it is prejudicial to the interest of the Revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment ..." On a careful reading of the said section it is clear that this power can be exercised suo motu by the Commissioner and if he considers that any order passed by the Income-tax Officer (now Assessing Officer) is erroneous and the same is prejudicial to the interests of the Revenue, he may, after giving the assessee an opportunity of being heard and after making or causing such inquiry to be made as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. The aforesaid section has been very clearly explained by the Supreme Court in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the respondent. According to me, production and manufacturing process means inputting raw materials and mixing the same if a new thing or material emerge then certainly it is a manufacturing process. The concrete piles are done with a process of mixing, and with the process a third article emerges and it is by way of a chemical process as the finished product cannot be converted back to the inputs and this finished product is used for other purposes. In this connection the decision of the Bombay High Court rendered in the case of CIT v. Pressure Piling Co. (India) P. Ltd. [1980] 126 ITR 333 has supportive value. At page 339 it is observed amongst other "... The essence of the manufacturing process is the conversion of raw material into an entirely new commodity or a new thing". All types of investments are not allowed by way of deduction under section 32A of the said Act. Section 32A, sub-section (2)(b)(iii), reads as follows: "in any other industrial undertaking for the purposes of business of construction, manufacture or production of any article or thing, not being an article or thing specified in the list in the Eleventh Schedule." The definition of "industrial company" in ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
