SIMRAN FARMS LTD Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is an appeal filed by assessee under Section 260a of the IT Act against an order dt. 30th Dec, 2003, passed by Tribunal, Bench Indore, in ITA No. 174/ind/2001. This appeal was admitted for final hearing on following substantial question of law: Whether Tribunal was justified in upholding the order passed by the CIT in its revisional jurisdiction under Section 263 of the IT Act which had resulted in revising the assessment order, dt. 28th Aug. , 1998 which according to the assessee had merged into an order passed by the CIT (A) on 28th April, 1999?

(2.) FACTS relevant for the disposal of appeal which lie in a narrow compass need mention infra.

(3.) THE assessee (appellant) is a limited company. It is engaged in the business of what is called "hatching eggs" by scientific methods. The assessee for the asst. yr. 1996-97 filed return of its income and inter alia claimed deductions under Sections 80hha, 80i and 80jj. In addition, the assessee also claimed deduction of interest income earned on certain loan amount invested in some concern, treating the said income to be an income from industrial undertaking. The AO by order dt. 28th Aug. , 1998 (Annex. 8) allowed the deduction claimed by assessee insofar as it related to claim under Sections 80hha, 80i and 80jj i. e. , Rs. 26,22,622 under Section 80hha, Rs. 26,22,622 under Section 80i and Rs. 43,70,599 under Section 80jj. However, AO declined to grant any benefit so far as interest amount of Rs. 7,27,591 was concerned as in the opinion of AO, the claim of interest made by assessee could not be regarded as income derived from business undertaken by industrial undertakings (assessee ).