Assessee is a cinema production house and had claimed a deduction u/s 80IA. AO disallowed the claims citing that clause (i)(ii) and (v) of Sub section 2 had not been satisfied. According to him the Assessee’s actions having been producing movies for a long period of time only amounted to splitting up or restructuring and that all its employees were on a contractual basis thus not having the minimum 10 workers for manufacturing under cl. 5. Commissioner (Appeals) held that Assessee had satisfied the requirements. In Appeal, held that each new movie produced would not be considered as splitting up or restructuring as it was a production house. Although the Assessee has used hired machinery for production the Department was unable to show that there was any transfer of used machinery to a new business or plant. That as per CBDT in Circular No. 24 (F. No. 6/22/68-IT(A-I dated July 23, 1969,  production of a cinema film would amount to manufacturing or processing of goods. Lastly, just because the employees were not regular employees of the Assessee does not mean they were not employed by the Assessee for the new production project, therefore there were more than 10 people working for the Assessee. Thus, Assessee was entitled to claim deduction u/s 80-IA. (ITA Nos. I.T.(SS)A. No. 06/CHNY/2018   BP 1-4-1986 to 30-1-1997)