ALUKKAS EXPORTERS Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE question raised is whether the Tribunal was justified in confirming the disallowance of exemption claimed under Section 10A by the assessee on the profit derived from export of gold jewellery. We heard the learned counsel appearing for the appellant and learned senior 'standing counsel for the respondent.

(2.) THE assessment is for the years 2004-05. THE assessee claimed exemption under Section 10A of the Act on an income of Rs.4,39,96,140/- on the ground that it had got ail industrial unit in the Special Economic Zone, Kochi where the ornaments were produced for export. However, the assessing officer noticed that assessee was not engaged in manufacturing of gold jewellery in the industrial unit in the Special Economic Zone and the only machinery the assessee had was valued at Rs.45,040/-, which is accounted in the books of accounts. Since goods exported were not manufactured in the unit in the Special Economic Zone, the assessing officer declined exemption. Even though the first appellate authority allowed the claim the Tribunal, on second appeal by the department, held that, the assessee, which has not manufactured and produced gold jewellery in the industrial unit in the Special Economic Zone, is not entitled to the benefit of exemption under Section 10A of the Act. It is against this order of the Tribunal, assessee has come up in appeal.