High Court grants investment allowance to Air Survey Co. under IT Act

The High Court of Calcutta ruled in favor of the Air Survey Co. of India (P) Ltd., holding that the company was entitled to investment allowance under section 32A of the IT Act, 1961 for the assessment year 1983-84. The Court agreed with the Tribunal's decision that the activity involving aircraft radio fell within the scope of "manufacture" or "production," and the resulting photographs qualified as an "article" or "thing." This decision aligned with previous rulings from the Rajasthan High Court and the Kerala High Court, ultimately granting the investment allowance to the assessee.

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Issues involved: Interpretation of section 32A of the IT Act, 1961 regarding entitlement to investment allowance on aircraft radio.

Summary:
The High Court of Calcutta considered the question of law regarding the entitlement to investment allowance under section 32A of the IT Act, 1961 on the aircraft radio. The case involved the Air Survey Co. of India (P) Ltd. for the assessment year 1983-84. The assessee's claim for investment allowance was initially rejected by the IAC (Asst.) on the basis that the activity did not amount to manufacture or production. The CIT(A) upheld this decision, but the Tribunal reversed it, stating that the activity fell within the scope of "manufacture" or "production" and that the resulting photographs qualified as "article" or "thing."

Upon considering the arguments presented, the Court agreed with the Tribunal's view, citing similar decisions from the Rajasthan High Court and the Kerala High Court. The Court concluded that the assessee was indeed entitled to the investment allowance under section 32A of the IT Act, 1961. The judgment was delivered in favor of the assessee.

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