1986 (2) TMI 90

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....mmissioner under section 263 of the Income-tax Act, 1961 ('the Act'). The findings of the Commissioner in his order under section 263 are as follows : "In regard to the deduction under section 80HH of the Income-tax Act, 1961, - it was argued by him that though the head office has borrowed moneys from the bank on the assets of its branch, the loan has been shown as a liability only in the balan....

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....ine the income/loss of a particular unit of business, all items of expenditure attirbutable to that unit will have to be considered in relation to that unit only. I therefore hold that the interest on the borrowings to the extent such borrowings have been utilised for the purpose of the new unit is to be considered in computing the income of loss of only that particular unit. In the circumstances,....

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....e. Before applying section 80HH, the income of the industrial undertaking has to be arrived at. Thus, it becomes the income of the unit and not that of the assessee who might be owning other units also. In the present case, although the head office has borrowed funds for investing in the new unit they nevertheless become the borrowals of the head office and not that of the unit. Taking an example,....