Section 80J deduction denied for leased cold storage plant where the assessee did not itself operate or manufacture.

Deduction under section 80J is available only where profits are derived from an industrial undertaking satisfying the statutory conditions in section 80J(4). A cold storage plant merely leased out did not qualify, because the assessee had not carried on manufacturing or production, had not operated the plant during the relevant year, and the lessee used it in its own independent right. Reliance on a prior development rebate ruling under section 33 was misplaced, as the section 80J scheme is materially different. The claim for deduction under section 80J was therefore not allowable, and the Tribunal was wrong to grant it.

---

---

Issues: Whether the assessee was entitled to deduction under section 80J of the Income-tax Act, 1961 in respect of its cold storage plant leased out, and whether the Tribunal was correct in holding that the statutory conditions for the relief were satisfied.

Analysis: Deduction under section 80J is available only to profits and gains derived from an industrial undertaking and, under section 80J(4), only if the undertaking satisfies the prescribed conditions. The assessee had not carried on manufacturing or production, had not operated the cold storage plant during the relevant previous year, and had merely let out the plant on hire. The operation by the lessee was in its own independent right and not on behalf of the assessee. The reliance placed on the earlier Tribunal decision relating to development rebate under section 33 was held to be misplaced because the statutory scheme of section 80J is materially different.

Conclusion: The assessee was not entitled to deduction under section 80J of the Income-tax Act, 1961, and the Tribunal was wrong in allowing the claim.

---