TaxTMI 
TaxTMI 
2014 (8) TMI 209
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....s income from manufacture and sale of consumer electronic durable goods. For the assessment year 2005-06, the assessee filed a return showing a loss of Rs. 64,127/-. The case was taken up for scrutiny and notice under Section 143(2) and 142(1) of the Income Tax Act, 1961 (hereinafter referred to as the Act) was issued. During the year in question, the assessee claimed deduction under Section 80-IB of the Act amounting to Rs. 18,51,055/-. The Assessing Officer issued a notice under Section 142(1) of the Act requiring the assessee to justify his claim of deduction under Section 80-IB of the Act. In response to the notice, the assessee submitted that his factory is situated in Jammu & Kashmir. On going through the claim of the assessee, the As....
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....sfer of plant and machinery to the new firm, inasmuch as it was only a transfer of the industrial undertaking as a whole along with the assets and liabilities. The Tribunal held that there was no splitting up or reconstruction of the business, which was already in existence and that it was only a case of change of the constitution of the same industrial concern, which continued to manufacture the same item, even after the admission of a partner. The Tribunal found that the conditions that disqualifies the deductions under Section 80-IB of the Act was not existing. The revenue, being aggrieved, has filed the present appeal under Section 260A of the Act, which was admitted on the following substantial questions of law:- 1. Whether the f....
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....Act the assessee was not entitled for deduction. In order to appreciate the submission of the learned counsel for the appellant, it would be appropriate to consider the provision of Section 80-IB of the Act, which is extracted hereunder: "Deduction in respect of profits and gains from certain industrial undertakings other than infrastructure development undertakings. 80-IB. (1) Where the gross total income of an assessee includes any profits and gains derived from any business referred to in sub-sections (3) to (11), (11A) and (11B) (such business being hereinafter referred to as the eligible business), there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the as....
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....which disqualifies the deduction are not present in the instant case. Our view is fortified by another similar provision, which were earlier existing under Section 84 of the Act, which was subsequently, omitted. For facility, Section 84 of the Act as it existed at the relevant moment of time is extracted hereunder:- "Income of newly established industrial undertaking of hotels. - (1) Save as otherwise hereinafter provided, income tax shall not be payable by an assessee on so much of the profits and gains derived from any industrial undertaking or business of a hotel or from any ship, to which this section applies, as does not exceed six per cent per annum on the capital employed in such undertaking or business or ship, computed in the....