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TMI Blog2009 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... ar, Senior Advocate with Ms. Niti Sheth with Ms. Pouromi Sheth for the Respondent. JUDGMENT JUSTICE D. A. MEHTA - At the time of admission, the following question was formulated by the High Court as substantial question of law on 6.12.1999: "Whether the Appellate Tribunal is right in law and on facts in allowing the claim of assessee for deduction under section 80HH of the Act?" 2. The Assessment Year in question is 1989-90, the relevant accounting period being from 1.1.1988 to 31.3.1989. The assessee, a Company, claimed deduction u/s.80HH of the Income Tax Act, 1961 (the Act). The same was disallowed by the Assessing Officer holding that the assessee carried on manufacturing activity at Chhatral which is situated in Kalol Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ications filed by the Revenue u/s. 256(2) of the Act were granted by the High Court but no corresponding Reference is available and the Appellant is not in a position to state as to whether the Tribunal has, or has not, forwarded the statement of case. 5. On merits, it was submitted that the Assessing Officer has incorrectly referred to Notification No. 89/165 dated 19.12.1986 because the correct Notification is Notification No. S.O. 165, dated 19.12.1986 [(1987) 165 ITR (Statute) 294]. That by virtue of the said Notification, Kalol Taluka of Mehsana District was excluded from the list of "backward area" and, therefore, the assessee was not entitled to any relief. 6. Referring to Circular No. 484 dated 1.5.1987 it was submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectly referred to and relied upon its own order for Assessment Year 1988-89 in assessee's own case. 8. It is common ground between the parties that the legislative scheme in the form of original Eighth Schedule, prior to insertion of sub-section (11) of section 80HH of the Act, specified entire Mehsana District, including Kalol Taluka, as "backward area" as per list appearing in the Eighth Schedule of the Act. By virtue of Taxation Laws (Amendment and Miscellaneous Provisions) Act, 1986, with effect from 10.09.1986 the Explanation below sub-section (10) of Section 80HH of the Act was omitted and sub-section (11) came to be inserted in Section 80HH of the Act. By virtue of the said provision, the legislative scheme underwent a partial mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Government may, having regard to the stage of development of that area, by notification in the Official Gazette specify in this behalf. The Schedule was omitted with effect from 1-4-1984 and it was provided that notification under sub-section (11) could be issued so as to have retrospective effect to a date not earlier than 1-4-1983. In pursuance of the new provisions of sub-section (11), a Notification No. 7056 (F.No.178/171/86-ITA.1) dated 19-12-1986 effective 1-4-1983 was issued notifying the list of backward areas. In this notification, certain blocks/taluks, where investment had exceeded Rs.30 crores as on 31-3-1983 were excluded. 2. In the interest of administrative convenience, it has been decided that the benefit of sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being entitled to relief under section 80HH of the Act. The Circular issued by the CBDT, referred to hereinbefore, is categorical when it states that the unit would continue to enjoy the benefit under section 80HH of the Act if the industrial undertaking was situated in a "backward area" as listed in the Eighth Schedule of the Act as it stood prior to 10.09.1986.(emphasis supplied). Therefore, there is no question of reappreciating the facts and evidence. The authority is only required to examine whether the industrial undertaking was located in a "backward area" listed in Eighth Schedule of the Act. If the answer is yes, the only inquiry thereafter is, as to whether unit had commenced manufacturing or production of articles on or before 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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