1 ITXA2727.09.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION KJ INCOME TAX APPEAL NO.2727 OF 2009 The Commissioner of Income Tax-2,Mumbai )..Appellant Vs. Hardik Paints Pvt. Ltd., )..Respondents ---- Mr. Vimal Gupta for the appellant. Mr. S.E.Dastur Senior Counsel @ Mr.P.J.Pardiwala Sr.Counsel and Mr.A.K.Jasani for the respondents. ---- CORAM : J. P .DEVADHAR & MRS.MRIDULA BHATKAR,JJ DATE : 21/2/2011. PC 1 The question raised in this appeal is “whether the Tribunal was justified in holding that the PVC Erasers produced by the assessee are manufactured items and entitled to deduction under Section 80 IA of the Income Tax Act 1961 ? 2 The Tribunal after considering material on record arrived at 2 ITXA2727.09.sxw a conclusion that the activity carried on by the assessee amounts to manufacturing activity and hence entitled to deduction under Section 80IA of the Act. It is pertinent to note that under the Central Excise Act, production of erasers constitutes manufacture and hence excisable under a distinct heading. By General Exemption No.54 dated 10.2.1986 the Central Government has granted total exemption for payment of excise duty on manufacture of erasers. In these circumstances the decision of the Tribunal that producing PVC erasers amounts to manufacture and hence the assessee is entitled to section 80IA deduction cannot be faulted. Dismissed. (MRS.MRIDULA BHATKAR,J) (J.P.DEVADHAR,J)