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TMI Blog2020 (5) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... d circumstances for the year under consideration viz a viz the earlier assessment years, we are of the view that the principles of consistency need to be applied. See M/S. SONATA SOFTWARE LTD VERSUS ADDL. COMMISSIONER OF INCOME TAX [ 2015 (3) TMI 353 - ITAT MUMBAI] In the similar facts and circumstances the jurisdictional High Court in the case of Saurashtra Cement Chemical Industries Ltd. [ 1979 (1) TMI 249 - GUJARAT HIGH COURT] has held that The tax holiday under section 80J cannot be discontinued in the subsequent year without disturbing the relief granted in the earlier year. We hold that the claim of the assessee for the deduction u/s 80IB cannot be denied for the year under consideration as the claim has been accepted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is duly supported by the certificate of chartered accountant in Form 10CCB. 3. The only issue raised by the assessee is that the learned CIT (A) erred in disallowing the deduction claimed under section 80-IB (3) of the Act. 4. The briefly stated fact is that the assessee is an individual engaged in business of Manufacturing of Mills Machinery parts chemical through proprietorship in the name and style of M/s Embee Corporation. During the year under consideration the assessee being Small Scale Industrial (for short SSI ) Undertaking claimed deduction @ 25% of the profit under section 80IB(3) of the Act. However the AO observed that the assessee has not fulfilled the precondition as required for claiming deduction under the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that day production has not been commenced, date of commencement of operation of undertaking as mentioned in Form 10CCB as 16th April, 2001 cannot be accepted. 5.4 During the course of Assessment Proceedings, as well as Appellate Proceedings, Appellant was asked to produce copy of Audited Annual accounts for A.Y. 2002-03 or stock register or other evidences which can justify commencement of production in A.Y. 2002-03. However, no such evidences were submitted by Appellant which can prove that Appellant has satisfied the basic condition of Section 80IB(3) that undertaking should commence production or article before A.Y. 2002-03. In absence of above details, Appellant is not entitled to deduction as claimed in Return of Income. Thu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of subsection 2 of section 80IB of the Act. ii. In the provisional certificate for registration as SSI unit, the assessee has shown 9 workers though in the year under consideration there are more than 10 workers. As such the condition of employing the numbers of workers have not been complied with. iii. The assessee failed to furnish the documentary evidence suggesting that the assessee has commenced his production in the assessment year 2002-03. In view of the above, the AO denied the claim of the assessee under section 80IB of the Act. The learned CIT (A) subsequently confirmed the order of the AO. 10. From the preceding discussion we find certain undisputed fact that the assessee has been claiming deduction under section 80IB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal in the case of Sonata software Ltd versus a CIT reported in 56 Taxmann.com 290 wherein it was held as under: 5.2 Thus, it can be seen that the claim of deduction in respect of each unit where section 10A deduction has been claimed as per chart mentioned herein above. The assessee was allowed the deduction in the initial assessment year which make fact of the case squarely covered by the decision of the Hon'ble Gujarat High Court in the case of Saurashtra Cement Chemicals Industries Ltd. (supra), wherein Hon'ble Court has made the following observations : The next question to which the Tribunal addressed itself, and in our opinion rightly, was whether the ITO was justified in refusing to continue the relief of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facts of the case in the light of the judicial decision cited herein above, in our considered opinion the claim of deduction cannot be denied unless claim is withdrawn right from the initial assessment year. Respectfully following the decisions of the Hon'ble Bombay High Court and Hon'ble Gujarat High Court, we set aside the findings of Ld. CIT(A) and direct the AO to allow the claim of deduction as made by the assessee 12. We also note that in the similar facts and circumstances the jurisdictional High Court in the case of Saurashtra Cement Chemical Industries Ltd. v. Commissioner of Income-tax reported in 2 Taxman 22 has held that The tax holiday under section 80J cannot be discontinued in the subsequent year without distur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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