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January 2012

Export: Exemption u/s.10B: A.Y. 2003-04: Assessee an approved EOU and manufacturing articles for export: Some work done on job basis by sister concern: Not relevant: Assessee entitled to exemption u/s.10B.

By K. B. Bhujle, Advocate
Reading Time 2 mins
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The assessee was an approved export-oriented unit and was manufacturing articles for export and was eligible for exemption u/s.10B of the Income-tax Act, 1961. For the A.Y. 2003-04, the Assessing Officer disallowed the exemption u/s.10B on the ground that the assessee had done some work on job basis from its sister concern. The Tribunal allowed the assessee’s claim.

On appeal by the Revenue, the Delhi High Court upheld the decision of the Tribunal and held as under:

“(i) There was no dispute that the assessee was an approved export-oriented unit and making exports. The authorities below recorded a finding that the assessee was involved in manufacture of an article or thing and the mere fact that it was getting some works done on job basis from its sister concern would not deprive the assessee of its claim to be an export-oriented manufacturing unit.

(ii) The Assessing Officer himself had recorded in respect of the assessee’s own case for the A.Y. 2004-05 that its unit fulfilled the conditions u/s.10B and allowed deduction. Even for the A.Y. 2005-06, the appeal filed by the assessee had already been allowed by the Commissioner (Appeals) holding the assessee to be entitled to claim deduction u/s.10B.

(iii) The assessee was entitled to exemption u/s.10B for the A.Y. 2003-04.”

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