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| The Tax Publishers2020 TaxPub(DT) 3019 (Mad-HC) : (2020) 428 ITR 0075 : (2020) 274 TAXMAN 0405 INCOME TAX ACT, 1961
Section 10AA
Where AO denied benefit of deduction under section 10AA on allegation that what was imported by assessee and what was exported, were same product and no manufacturing activity was done, as AO himself accepted that assessee's unit, processed raw materials by removing impurities and AO could not establish that assessee suppressed purchase cost of semi-finished goods in order to claim higher deduction under section 10AA, deduction could not be disallowed.
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Deduction under section 10AA - No manufacturing activity alleged to be done by assessee - Product imported and subsequently exported by assessee were same product -
AO denied benefit of deduction under section 10AA claimed by assessee on allegation that what was imported by assessee and what was exported, were same product and therefore, there was no manufacturing activity done by assessee to be eligible to claim deduction. Held: There was a process of 'manufacture' as defined under SEZ Act, which took place in SEZ unit. AO himself accepted that assessee's unit, processed raw materials by removing 10 to 20% impurities. After cost comparison of semi finished product with that of raw material, AO could not establish that assessee suppressed purchase cost of semi-finished goods in order to claim higher deduction under section 10AA. Certificate issued by Assistant Development Officer was accepted as revenue could not prove the same to be not genuine. Thus, deduction was to be allowed.
Confirmed:The ACIT v. Vetrivel Minerals [I.T.A. No. 706/Mds/2017, dt. 20-9-2017].
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2013-14
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