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TMI Blog2022 (7) TMI 1003X X X X Extracts X X X X X X X X Extracts X X X X ..... urchased of plant and machinery in the earlier assessment order, otherwise the issue was to be examine in the scrutiny assessment for assessment year 2010-11. AO has not been able to point out any specific defect in the record in fulfilling the condition. The Ld. CIT(A) also noted that once the claim is similar deduction is allowed in the scrutiny assessment, in an initial year, the similar cannot be disallowed without withdrawing or disturbing the similar claim or relief in the earlier year as has been held in the case of Saurashtra Cement And Chemicals Industries Ltd. ( 1979 (2) TMI 21 - GUJARAT HIGH COURT] held that assessee is eligible for deduction under section 10B. We find that during the hearing of the present appeal, no contrary facts or law is brought to our notice to take other view. The ld CIT(A) allowed relief to the assessee by following the binding decision of Jurisdictional High Court in Saurashtra Cement And Chemicals Industries Ltd. (supra). Therefore, we do not find any reason to interfere with the order passed by Ld. CIT(A), which we affirm. The ground of appeal raised by the Revenue is dismissed. - ITA No.349/SRT/2017 - - - Dated:- 12-7-2022 - Shri Pawa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and asked to substantiate its claim under section 10B. The assessee furnished necessary evidence to substantiate its claim of exemption. On perusal of such details, the Assessing Officer was of the view that basic nature of business activities of import, export and manufacturing of precious stone. The assessee obtained approval of setting up 100% Export Oriented Unit (for short to as EOU ) at Balar Building, Lambe Hanuman Road, Surat-395006 from the Development Commissioner, Kandla Special Economic Zone (for short to as KSEZ ), Gandhidham vide permission dated 04-05/12/2033. On further perusal of record, the Assessing Officer was of the view that the assessee filed its return of income for assessment year 2008-09 for the first time showing details of plant and machinery, in the year 2008-09 and assessee was not made any such business activities. Thus, it appears that plant and machinery acquired and installed at Balar Building, Lambe Hanuman Road, Surat-395006 were not installed at business premises and kept idle up to 1.10.2009. The assessee has not furnished any evidence like date of purchase of plant and machinery, place of instalment date and bank account. To substantiate th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned from cutting polishing of diamond in permission dated 4- 5/12/2003 issued by concerned Special Economic Zone (for shot to as SEZ ) should be a date after 01.04.2004. The assessee initially obtained permission vide order / letter dated 4-5/12/2003, which was extended by the Development Commissioner of KSEZ upto 04.12.2009, vide its letter dated 10.10.2008 on the basis of application dated 11.08.2008, which was granted by Competent Authority vide letter dated 10.10.2008. The assessee has to commence manufacturing activities from 04.12.2009, whereas the assessee commenced the manufacturing activities of cutting polishing diamond from 01.01.2009 and thus, well in the extended period approved by the Competent Authority of KSEZ. The Assessing Officer erred in suo motu assuming superior position that the permission granted by Competent Authority of Section 10B, nowhere stated that claiming exemption under section 10B by assessee should be in its possession a letter of permission issued by the Competent Authority of SEZ. Thus, the Assessing Officer erred in imposing one more condition on the assessee. The assessee further stated that even it is presumed, without accepting that rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee submitted that they are s eligible for exemption under section10B. The assessee claimed their case is also covered by the decision of co-ordinate Bench of ITAT Tribunal in the case of Janak Dehydration P. Ltd. in ITA No.2325/AHD/2006 dated 27.09.2010 and the judgment of Hon'ble jurisdictional High Court in the case of CIT vs. Saurashtra Cement And Chemicals Industries Ltd. (1980) 123 ITR 669 (Guj) and Hon'ble Supreme Court in the case of CIT vs. Delhi Patra Prakashan Ltd. (2013) 355 ITR 14 (Del) and Hon'ble Supreme Court in the case of Parashuram Pottery Works Co. Ltd. vs. ITO GA-1 Ward-A Rajkot (1977) 106 ITR 1 (SC). 4. The ld CIT(A) after considering the contents of the assessment order and the submissions of the assessee held that the first year of exemption under section 10B was assessment year 2010-11, wherein assessee made such claim and was allowed by assessing officer under scrutiny assessment under section 143(3). There is no change in the facts and circumstances, and the proposition in law, the Assessing Officer has not taken any step to make a remedial action in assessment year 2010- 11. Thus, there is no uniformity in the action of the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther details of plant and machinery available from the record, for financial years 2007-08 2008-09. It was seen that there was some discrepancies noticed therein. The assessee has failed to discharge its onus to prove that plant and machinery was used for production purpose were new plant and machinery and not manner used for production purpose was new and the plant and machinery. As per the terms and condition of KSEZ the permission granted KSEZ as well as Foreign Trade policy, the assessee had to invest a minimum of Rs.1.00 crore for establishment of 100% EOU. The assessee failed to discharge the onus likely upon that plant and machinery installed in the unit to which exemption is claimed is new plant and machinery. The assessee failed to furnish the requisite details. Thus, disallowance under section 10B for Rs.1.74 crores is not sustainable by taking view that Assessing Officer has not been able to point out any specific default in fulfilling the condition laid down under section 10B of the Act. The Ld. CIT(A) also directed the Assessing Officer to delete the addition of Rs.13,68,959/- by treating the sale of rejected diamond as the books of account were rejected by Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion already in existence. Further as appeared its Foreign Trade Policy requirement, the minimum investment of Rs.1 crore for establishment of 100% EOU categorical on which assessee claimed exemption is not complied with. 9. We find that before Ld. CIT(A) the assessee has filed detailed written submission as recorded above and the Ld. CIT(A) after considering the submission of assessee held that the first year of exemption under section 10B was assessment year 2010- 11, wherein assessee made such claim and was allowed under scrutiny assessment under section 143(3). There is no change in the facts and circumstances, and the proposition in law, the Assessing Officer has not taken any step to make a remedial action in assessment year 2010-11. The ld CIT(A) held that there is no uniformity in the action of the Assessing Officer qua the preceding assessment year. The ld CIT(A) recorded that permission for starting business was allowed vide order dated 4-5.12.2003 by competent authorities of KSEZ and the deduction for income in such business came into statue book from 01.04.2004 by virtue of which the assessee has become eligible for deduction for the business of cutting polishing s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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