| Case ID |
73912195-75bb-419f-b43a-eb25a970b0f8 |
| Body |
View case body. Login to View |
| Case Number |
IT REFERENCE NO. 369 OF 1980 |
| Decision Date |
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| Hearing Date |
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| Decision |
The court held that the tax concession under section 80J is available for five successive assessment years from the year the industrial undertaking goes into production. The term 'per annum' means that the relief is available for each year to the extent of 6 percent of the capital employed, regardless of the actual operational time within the year. The court concluded that the relief under section 80J cannot be reduced proportionately based on the period of operation within the accounting year. Therefore, the assessee was entitled to full relief under section 80J, even though the new industrial unit operated for only one month during the relevant accounting year. |
| Summary |
In this landmark decision from the Calcutta High Court, the interpretation of Section 80J of the Income-tax Act, 1961 was critically examined. The court clarified that the deductions for profits and gains from newly established industrial undertakings are designed to promote industrial growth and should not be limited by the operational duration within the year. The case of Commissioner of Income Tax v. Oyster Packagers (P.) Ltd. emphasized the importance of incentivizing new businesses by allowing full tax relief for the first five years, irrespective of how long they actually operated during the relevant accounting year. This ruling aligns with the broader objective of encouraging investment and economic development through favorable tax policies. The decision is significant for tax practitioners and businesses aiming to understand their entitlements under the Income-tax Act. Keywords such as 'tax relief', 'Income-tax Act', 'industrial undertakings', and 'section 80J' are essential for SEO optimization in legal discussions and tax advisory services. |
| Court |
Calcutta High Court
|
| Entities Involved |
Not available
|
| Judges |
DIPAK KUMAR SEN,
AJIT K. SENGUPTA
|
| Lawyers |
Not available
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
Oyster Packagers (P.) Ltd.
|
| Citations |
1985 SLD 983,
(1985) 152 ITR 471
|
| Other Citations |
CIT v. Simpson & Co. [1980] 122 ITR 283 (Mad.),
CIT v. Sanghi Beverages (P.) Ltd. [1982] 134 ITR 623 (MP),
CIT v. Mysore Petro-Chemical Ltd. [1984] 145 ITR 416 (Kar.),
Addl. CIT v. Gedore Tools (India) (P.) Ltd. [1982] 134 ITR 592 (Delhi)
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| Laws Involved |
Income-tax Act, 1961
|
| Sections |
80J
|