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March 2016

Manufacture – Exemption u/s. 10B – A. Ys. 2003- 04 and 2004-05 – Assembling of instruments and apparatus for measuring and detecting ionizing radiators amounts to manufacture – Assessee entitled to exemption u/s. 10B –

By K. B. Bhujle Advocate
Reading Time 1 mins
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CIT vs. Saint Gobain Crystals and Detectors India P. Ltd.; 380 ITR 226 (Karn):

The assessee was in the business of assembling instruments and apparatus for measuring and detecting ionizing radiators. The assessee claimed deduction u/s. 10B. For the relevant years, the Assessing Officer disallowed the claim on the ground that the assessee had not manufactured or produced articles or things as required u/s. 10B(1). The Tribunal allowed the assessee’s claim and held that the process carried out by the assessee in getting the final product, showed that the assessee was engaged in manufacture or production of an article or thing.

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

“The finished product which was sold by the assessee, was different from the materials which were procured for making such a finished product. A series of processes were carried out and a new product emerged. The assessee was entitled to exemption u/s. 10B.”

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