Law:

Section:

JUDGMENT 1. The assessee has preferred this appeal against the order passed by the Tribunal affirming the finding recorded by the Commissioner of Income Tax that the assessee is not entitled to claim deduction under Sec.80IB(3) of the Income Tax Act, 1961 (for short, the 'Act'), as in the 9th year it ceased to be small scale industry. 2. Assessee is a company engaged in the business of manufacture and sale of components/parts of CNC lathes and similar machines. The assessee furnished its return of income, admitting a total income of Rs.1.76 crores which was initially processed under Sec. 143(1) of the Act. Subsequently, the case was subjected to scrutiny under Sec. 143(3) of the Act. The Assessing Officer concluded the assessment, determining the assessee's income at Rs.1,79,82,653/-, after disallowing certain expenses, aggregating to Rs.2.91 lakhs. The Commissioner of Income Tax, by virtue of the power conferred under Sec.263 of the Act, initiated suo moto to proceedings on the ground that the assessment order was erroneous and prejudicial to the Revenue. According to the Commissioner, the Assessing Officer has wrongly allowed deduction under Sec.80IB(3) of the Act, as claimed by the assessee. After hearing the assessee, he passed an order setting aside the assessment order with a direction to decide the claim under Sec.80IA/80IB. In pursuance to the said direction issued, the Assessing Authority disallowed the assessee's claim of Rs.75,81,910/- under Sec.80IB(3) of the Act. Aggrieved by the said order, the assessee preferred an appeal to the Commissioner. The Commissioner dismissed the appeal. Aggrieved by the said order, the assessee preferred an appeal to the Tribunal. The Tribunal, on consideration of the rival contentions, held, each assessment order is separate and independent. The Revenue authorities had every power to examine and analyze the facts and figures, as well as relevant law point of each year to find out, all the conditions are fulfilled or not. The value of the plant and machinery exceed Rupees One Crore during the year under consideration, which incidentally deprived the assessee to call itself as a small scale industry and therefore the…

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