Maintainability of appeal and full section 80J deduction upheld where the undertaking operated only part of the year.

An appeal against an order giving effect to appellate directions was treated as maintainable because the point was already covered by settled precedent in the assessee's own case. Relief under section 80J of the Income-tax Act was held to be available in full for the assessment year even where the new industrial undertaking operated only during part of the accounting year, since the deduction depended on functioning during the relevant year and not on continuous operation for all twelve months. Both issues were decided in favour of the assessee, and the Revenue's challenge failed.

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Issues: (i) whether the appeal against the order passed to give effect to the directions of the appellate authority was maintainable; (ii) whether relief under section 80J of the Income-tax Act, 1961 could be granted for the entire period of twelve months when the industrial undertaking worked only for part of the year.

Issue (i): whether the appeal against the order passed to give effect to the directions of the appellate authority was maintainable.

Analysis: The question was treated as covered by an earlier decision in the assessee's own case, and no contrary distinction was shown. The maintainability issue was therefore answered consistently with the settled view already taken on the same point.

Conclusion: The issue was answered in the affirmative, in favour of the assessee and against the Department.

Issue (ii): whether relief under section 80J of the Income-tax Act, 1961 could be granted for the entire period of twelve months when the industrial undertaking worked only for part of the year.

Analysis: The deduction under section 80J was held to depend on the existence and functioning of the new industrial undertaking during the relevant accounting year, and not on its operation throughout the full twelve months. The consistent judicial view accepted that once the undertaking functioned during any part of the year, the assessee was entitled to the full statutory deduction for that assessment year. The conclusion was supported by prior authorities and by the Central Board of Direct Taxes circular affirming the same position.

Conclusion: The issue was answered in the affirmative, in favour of the assessee and against the Revenue.

Final Conclusion: Both referred questions were decided for the assessee, and the Revenue's challenge failed on each point.

Ratio Decidendi: Where a new industrial undertaking has functioned during any part of the relevant accounting year, the statutory deduction under section 80J is allowable in full for that assessment year, and an appeal against an order giving effect to binding directions is maintainable when the issue is governed by settled precedent.

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