| Case ID |
21431b98-f788-43be-85cc-b11aad86c053 |
| Body |
View case body. Login to View |
| Case Number |
S.J.C. Nos. 97, 98 AND 99 OF 1978 |
| Decision Date |
Nov 13, 1979 |
| Hearing Date |
|
| Decision |
The Orissa High Court ruled that the Income-tax Appellate Tribunal correctly determined that the assessees were entitled to the benefits under section 80HH of the Income-tax Act, 1961. The court found that the construction of the dam constituted an industrial activity that qualified for the deduction, as the work involved substantial labor and capital investment. The court rejected the argument that the firms were short-lived or that they did not manufacture articles, emphasizing that the legislative intent was to support industrial activities in backward areas. The decision reinforced the understanding that industrial undertakings could include construction activities, thereby allowing the firms to benefit from the tax relief. The court concluded by awarding the costs of the references to the assessees. |
| Summary |
In the landmark case of S.J.C. Nos. 97, 98, and 99 of 1978 heard by the Orissa High Court, the central issue revolved around the applicability of section 80HH of the Income-tax Act, 1961, to the construction activities undertaken by N.C. Budharaja and Company. The court examined whether the firms involved in constructing irrigation projects qualified as 'industrial undertakings' eligible for tax benefits. The Income-tax Appellate Tribunal had initially granted relief under section 80HH, which allows deductions for profits derived from newly established industrial units in backward areas. The Commissioner challenged this, arguing that the firms did not engage in manufacturing or producing articles. However, the High Court upheld the Tribunal's findings, ruling that the construction of a dam constituted industrial activity, thereby qualifying for the tax concession. This case underscores the legal interpretation of industrial undertakings in the context of taxation, particularly in supporting development projects in economically backward regions. Keywords: Income Tax, section 80HH, industrial undertakings, tax benefits, irrigation projects, Orissa High Court, construction activities, economic development, backward areas. |
| Court |
Orissa High Court
|
| Entities Involved |
|
| Judges |
R.N. Misra,
N.K. Das
|
| Lawyers |
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
N.C. Budharaja and Company
|
| Citations |
1980 SLD 614,
(1980) 121 ITR 212
|
| Other Citations |
Addl. Commissioner of Income-tax v. Farukkabad Cold storage (P.) Ltd. [1977] 107 ITR 816,
Commissioner of Income-tax v. Tata Locomotive & Engineering Co. Ltd. [1968] 68 ITR 325
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
80HH,
256(2),
263
|