Section 80J deduction not to be reduced proportionately for part-year operation; statutory computation governs relief.

Deduction under section 80J of the Income-tax Act, 1961 was held to be computable on the statutory basis and not reduced proportionately merely because the industrial unit operated for only part of the accounting year. The High Court followed its earlier view and the line of authority that relief under section 80J depends on the statutory method of computation, not on the number of days of actual operation during the year. The issue was answered in favour of the assessee, and proportionate curtailment of the deduction was rejected.

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Issues: Whether deduction under section 80J of the Income-tax Act, 1961, was required to be computed proportionately with reference to the number of days of operation during the relevant accounting year.

Analysis: The question had already been considered by several High Courts. The Court followed its earlier view and the line of authority holding that relief under section 80J is to be computed on the statutory basis and is not to be curtailed merely because the industrial unit operated for only a part of the accounting year.

Conclusion: The question was answered in the affirmative, holding that the deduction under section 80J was not to be computed proportionately with reference to the number of days of operation, and the answer was in favour of the assessee.

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