COMMISSIONER OF INCOME TAX Vs. TRIDENT MINERALS

JUDGEMENT

(1.) This appeal is filed by the Revenue against the order dated 07.02.2014 made in ITA No.1050/Bang/2012, for the assessment year 2009-2010 on the file of the Income Tax Appellate Tribunal, Bengaluru Bench "A", allowing the appeal in part by upholding the provisions of Section 10B of the Income Tax Act, 1961 (for short 'the Act') and remanding the matter in respect of disallowance of excess profits amounting to Rs. 4,76,52,385/- due to transactions with sister concerns from computation of the eligible deduction under Section 10B of the Act, was withdrawn by the assessee, when actually it was not so.

(2.) It is the case of the assessee that they carry business of production, manufacture and export of iron ore. On 05.10.2007, the assessee M/s.Trident Minerals 100% EOU formed a partnership firm and on 15.11.2007, approval was granted by SEZ as 100% Export Oriented Unit. In the assessment year 2008-2009, they commenced production and manufacture. In the assessment year, 2009-2010, export takes place for the first time after merger. On 01.09.2006, M/s.KMNI Exports 100% EOU carrying on same business of manufacture, production and export of iron ore formed under a partnership firm. On 03.11.2006, 100% EOU approval was granted by SEZ. In the assessment year 2007-2008, it commenced production, manufacture and export of iron ore and in the assessment year 2008-2009, export of iron ore and claim of deduction under Section 10B of the Income Tax Act was allowed for the first year. On 005.2008, M/s.KMMI Exports merged with M/s.Trident Minerals 100% EOU. On 209.2009, return of income was filed under Section 139 (1) of the Act and deduction under Section 10B of the Act was claimed in respect of export income. The Assessing Officer after considering the entire material on record, by an order dated 26.12011 held that deduction under Section 10B of the Act was not allowable on the ground that two partnership firms had been merged and that assets of M/s.KMMI Exports had been taken over by M/s.Trident Minerals. In the appeal filed by the assessee, the Commissioner of Income Tax (Appeals), by an order dated 30.05.2012 allowed the appeal and also allowed the claim of the assessee under Section 10B of the Act.

(3.) On the appeal filed by the Deputy Commissioner of Income Tax, Ballari, the Tribunal by the impugned order dated 07.02.2014 dismissed the appeal filed by the Revenue and held that the assessee is entitled to claim benefit under the provisions of Section 10B of the Act. Aggrieved by the said order, the present appeal is filed.