Commissioner of Income Tax vs Madhav Industrial Corpn.

M.S. Shah, J.

In this reference at the instance of the revenue, the following question is referred for our opinion, in respect of the assessment year 1986-87 :

"Whether, the Appellate Tribunal is right in law and on facts in holding that the assessee which is engaged in ship breaking business is entitled for grant of deduction under sections 80HHA and 80-I considering the same as manufacturing activity ?"

We have heard Mr. M.R. Bhatt, learned Standing counsel for the revenue and Mr. R.K. Patel, learned counsel for the respondent-assessee.

Our attention is drawn to the decision of another Division Bench of this court in Commissioner of Income Tax Vs. Vijay Ship Breaking Corporation, , taking the view that ship breaking activity was not an activity of manufacture or production of any article or thing for the purposes of availing of the benefit of deductions under sections 80HHA and 80-I of the Income Tax Act, 1961. Since the provisions of section 80HHA are similar, insofar as the controversy involved in the present reference is concerned, we respectfully follow the aforesaid decision and answer the question in the negative, i.e., in favour of the revenue and against the assessee.

At this stage, Mr. R.K. Patel, learned counsel for the respondent-assessee, states that the aforesaid decision of this court has been challenged before the Hon''ble Supreme Court and the Hon''ble Supreme Court has granted leave to appeal and, therefore, he prays for certificate u/s 261 of the Income Tax Act, 1961.

In view of the aforesaid statement that the SLP against the aforesaid decision is granted, which statement is not disputed by the learned counsel for the revenue, we certify this to be a fit case for appeal to the Hon''ble Supreme Court.

The reference accordingly stands disposed of.