TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>SICA Scheme Prevails Over Income Tax Act Section 43B in Sick Industries Rehabilitation</h1> <h3>Commissioner of Income Tax-I, Chennai. Versus M/s. Tube Investments of India Ltd-I,</h3> Commissioner of Income Tax-I, Chennai. Versus M/s. Tube Investments of India Ltd-I, - [2012] 341 ITR 199 Issues:1. Whether the BIFR's recommendation to grant exemption from Section 43B provisions should be treated as a mandateRs.2. Whether the circulars issued by the BIFR are applicable to the caseRs.3. Whether the provisions of Section 32 of SICA override Section 43B of the Income Tax ActRs.Issue 1: The Tax Case Appeals were filed by the Revenue challenging the order of the Income Tax Appellate Tribunal regarding the deduction claimed under Section 43B of the Income Tax Act by the respondent assessee who took over a sick unit as per the BIFR scheme. The Tribunal allowed the appeals based on BIFR circulars, leading to the Revenue's appeals. The key question was whether the BIFR's recommendation should be considered a mandate.Issue 2: The circulars issued by the BIFR clarified that once a scheme is sanctioned under Section 18 of SICA, it will have overriding effect over the Income Tax Act only in matters covered in a specific circular related to Section 41(1) of the Act, not Section 43B. The Tribunal's reliance on these circulars for the deduction claim under Section 43B was deemed unsustainable.Issue 3: Section 32 of SICA states that its provisions shall have effect notwithstanding anything inconsistent in any other law. The High Court held that the scheme framed under SICA would override the provisions of the Income Tax Act, including Section 43B. The Court emphasized that the scheme's objective is rehabilitation of sick industries, and the benefit of deduction under Section 43B should be considered in that context. The Court dismissed the appeals, stating that the scheme's direction need not explicitly mention the deduction under Section 43B for it to be applicable, as the scheme should be interpreted in light of the rehabilitation purpose. The judgment was also supported by a similar view taken by the Calcutta High Court in a related case.
TaxTMI 