The  business of assessee-company is  to manufacture Milk and Milk based products at industrial area of Haridwar. It filed its Income-tax return declaring certain business income which is claimed to be 100 per cent exempt under section 80IC(2)(a)(ii). Assessing Officer disallowed claim under section 80IC on allegation that designated zone of assessee was not notified in circular of zones for section 80-IC and conversion of assessee to company from partnership was reconstruction of business. On appeal before Commissioner (Appeals), assessee submitted notification stating that it’s zone was covered as a designated zone under section 80-IC. However, Commissioner (Appeals) changed basis of disallowance, by pointing that turnover and stock in Tax Audit Report versus Financial Statements was different and Form No. 10CCB mentioned initial assessment year as assessment year 2009-10 and not assessment year 2007-08, being date of inception of partnership. On appeal the Tribunal held that   since there is  a mere change in status of company in terms of its composition same did not brings into action provisions of section 80IC(4)(ii). The assessee is entitle to deduction.(AY. 2010-11)