Deduction U/s 80 IB
This query is : Resolved
Amit Kumat
(Querist)
27 September 2007
Dear Sir,
We are manufacturer & Sale of Processing of food (Ready to eat snack) i.e. Potato Chips like lays. in Palda Indore, From July - 2004.
our qt.is :-
Are we eligible of deducting U/s 80-IB ?
We are manufacturer & Sale of Processing of food (Ready to eat snack) i.e. Potato Chips like lays. in Palda Indore, From July - 2004.
our qt.is :-
Are we eligible of deducting U/s 80-IB ?
Amit Kumat
(Querist)
27 September 2007
Late CA Sampat Jain
(Expert)
28 September 2007
tell the location of your industry .....with dag no , patta no etc??
Late CA Sampat Jain
(Expert)
28 September 2007
whether started with new plant and machineriers???
Amit Kumat
(Querist)
28 September 2007
Situated at : khasra no. 387/1/4, Nemawar Road, Gram; Palda, Dist: Indore (M.P.)
and in July 2004 we have started the commercial production with new plant & machinery.
and in July 2004 we have started the commercial production with new plant & machinery.
Amit Kumat
(Querist)
05 October 2007
Situated at : khasra no. 387/1/4, Nemawar Road, Gram; Palda, Dist: Indore (M.P.)
and in July 2004 we have started the commercial production with new plant & machinery.
and in July 2004 we have started the commercial production with new plant & machinery.
Late CA Sampat Jain
(Expert)
12 October 2007
Manufacture/Production
General tests - Manufacture and processing are not clearly demarcated fields. The test of manufacture lies in the answer to the question whether what is processed or produced as the end-product is commercially known as a different product from the materials out of which it is so produced. Therefore, if the product has a different name and is identified by the buyers and sellers as a different product and is bought and sold as a distinct product from its raw materials, one can say that it is a manufactured product. There may be some room for debate as to whether this test is fully satisfied by edibles that come as end-products from the raw materials out of which they are made. But the expression ‘produce’ has to be taken in a more liberal sense than manufacture. If the end-product is different, that by itself would suffice to meet the requirement of ‘producing’. Hence, an exclusive catering unit of a hotel supplying eatables in bulk for consumption by air passengers will be eligible for relief - CIT v. East India Hotels Ltd. [1994] 209 ITR 854 (Cal.).
Provision must be construed liberally - A provision in the taxing statute granting incentives for promoting growth and development should be construed liberally. Since a provision intended for promoting economic growth has to be interpreted liberally, the restriction on it too has to be construed so as to advance the objective of the provision and not to frustrate it - Bajaj Tempo Ltd. v. CIT [1992] 62 Taxman 480 (SC).
CONSIDERING WHETHER YOU MEET OTHER ELIGIBILITY CRITERIA , YOU HAVE TO TAKE A DECISION ON THE BASIS OF ABOVE CASES
General tests - Manufacture and processing are not clearly demarcated fields. The test of manufacture lies in the answer to the question whether what is processed or produced as the end-product is commercially known as a different product from the materials out of which it is so produced. Therefore, if the product has a different name and is identified by the buyers and sellers as a different product and is bought and sold as a distinct product from its raw materials, one can say that it is a manufactured product. There may be some room for debate as to whether this test is fully satisfied by edibles that come as end-products from the raw materials out of which they are made. But the expression ‘produce’ has to be taken in a more liberal sense than manufacture. If the end-product is different, that by itself would suffice to meet the requirement of ‘producing’. Hence, an exclusive catering unit of a hotel supplying eatables in bulk for consumption by air passengers will be eligible for relief - CIT v. East India Hotels Ltd. [1994] 209 ITR 854 (Cal.).
Provision must be construed liberally - A provision in the taxing statute granting incentives for promoting growth and development should be construed liberally. Since a provision intended for promoting economic growth has to be interpreted liberally, the restriction on it too has to be construed so as to advance the objective of the provision and not to frustrate it - Bajaj Tempo Ltd. v. CIT [1992] 62 Taxman 480 (SC).
CONSIDERING WHETHER YOU MEET OTHER ELIGIBILITY CRITERIA , YOU HAVE TO TAKE A DECISION ON THE BASIS OF ABOVE CASES
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