2021 (6) TMI 824

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....appeal. 2. The above appeal was admitted on the following substantial question of law: " Whether on the facts and In the circumstances of the case, the Income-Tax Appellate Tribunal was right in law in holding that the assessee is entitled deduction under section 80IA of the Act, even though where a company apart from his regular business and in the business of generation and distribution of power, owning more than one Industrial Undertaking, deduction under Section 80IA of the Act is to be allowed to a single Industrial Unit not all the units taken together?" 3. When the appeal is taken up for hearing, T.R. Senthil Kumar, learned Senior Standing Counsel appearing for the appellant-revenue fairly submitted that the substantial question ....

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....e grant of deduction under Section 80I of the Act. After considering the provisions of Section 80I, 80A, 80AB and 80B, the Bench holds as follows: 12. The contention that under Section 80-I (6) the profits derived from one industrial undertaking cannot be set off against loss suffered from another and the profit is required to be computed as if profit making industrial undertaking was the only source of income, has no merits. Section 80-I (1) lays down that where the gross total income of the assessee includes any profits derived from the priority undertaking/unit/division, then in computing the total income of the assessee, a deduction from such profits of an amount equal to 20% has to be made. Section 80-I (1) lays down the broad parame....

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....the profits derived from an industrial undertaking. If the interpretation as suggested by the appellant is accepted it would almost render the provisions of Section 80A(2) of the Act nugatory and therefore the interpretation canvassed on behalf of the appellant cannot be accepted. It is true that under Section 80-I(6) for the purpose of calculating the deduction, the loss sustained in one of the units, cannot be taken into account because Sub-Section 6 contemplates that only the profits shall be taken into account as if it was the only source of income. However, Section 80A(2) and Section 80B (5) are declaratory in nature. They apply to all the Sections falling in Chapter VI-A. They impose a ceiling on the total amount of deduction and ther....