Clarification - Deduction u/s 80IC

[DEEPAK GOYAL]

An enterprise is having its unit in Baddi and availing deduction u/s 80IC, from last two yrs, now it has started two other units, one at same address and other at different address, will deduction be seperately available to each unit independently, or it will be available collectively for all the units.

[Surender Gupta]

You need to ascertain first that the case is of expansion of existing unit or establishment of a new unit. If it is an expansion of new unit, the exemption granted under section 80IC would be merged with the existing exemption of that unit. In case it is establishment of a new unit, you may get exemption separately for each units.

AI Summary

Deduction under section 80IC depends on whether units are expansions (exemption merged) or new establishments. Whether additional operations constitute an expansion of an existing unit or the establishment of a new unit determines entitlement to separate tax incentives: expansions result in merger of the existing exemption with the expanded activity, whereas independently established units may claim exemptions separately.