IN RE: MS. MEENU SAHI MAMIK Vs. STATE

JUDGEMENT

(1.) MS . Meenu Sahi Mamik a resident of Amsterdam, Netherlands has filed an application under Section 245Q(1) of the Income -tax Act, 1961 (for short "the Act") on March 10, 2006, in Form No. 34C (meant for non -resident applicants). The applicant wants to establish a manufacturing facility for the formulation of pharmaceuticals in partnership with one of her family members in the State of Himachal Pradesh, India, to avail of the tax holiday under Section 80 -IC of the Act. The Central Government has declared income -tax holiday for a 10 year period for industrial undertakings in the State of Himachal Pradesh. The proposed industrial unit would be an integrated unit and would exist as a viable unit. Bayer Health Care Pharmaceuticals (for short "Bayer Health") proposes to have their products manufactured at the proposed unit by outsourcing the production but under their own direct supervision, licence and control, for which Bayer Health would pay negotiated processing charges to the firm. The specifications for manufacturing the various drugs would be provided by Bayer Health, and the applicant's firm, under the direct control and supervision of Bayer Health, would produce the pharmaceutical formulations. The finished goods thus manufactured would be sold under the Bayer Health trademark and would not be covered by Schedule XIII of the Act. In addition to this the firm would also procure direct business. On the facts stated, the applicant has sought the ruling of the Authority on the following questions:

(2.) WHETHER the processing charges received by my firm from Bayer Health Care Pharmaceuticals, Mumbai, would be exempt under Section 80 -IC?

(3.) THE Commissioner in his reply to the rejoinder has stated as under: