CIT Vs M/s Micro Instruments Company (Punjab & Haryana High Court)
Brief of the case:
- The Hon’ble Punjab & Haryana HC in the above cited case held that deduction under section 80IB is allowable over a period of 6 years which follows that conditions for claiming deduction must remain fulfilled in all years for which deduction being claimed.
- Therefore, even when AO has allowed deduction in an Assessment year would not restrict him to retest the compliance to conditions stated in Sec 80IB who on finding non-compliance bound to disallow the deduction for the AY and all coming AYs. However, deduction already allowed for earlier AYs cannot be disallowed.
Facts of the case:
- The assessee in its return of income claimed deduction of Rs. .16,22,661/-. under Section 80-IB in respect of a new unit viz. Unit No.II. The Assessing officer disallowed the deduction claimed u/s 80IB for the following reasons:
i) No separate books of accounts have been maintained for Unit –II.
ii)The workers/employees are common in respect of Unit Iand Unit II there is no demarcation of employees/workers asper Attendance Register Produced.
iii) There is no power connection in unit-II.
iv) Bank accounts of Unit-I & Unit-II is same.
v) Telephone connections/numbers are common.
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