Case Law Details
CIT Vs M/s. Bannari Amman Sugars Ltd. (Madras High Court)
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?
As per the provisions of section 80IB(5) of the Income Tax Act which provides that in determining the quantum of deduction under section 80IA, the eligible business shall be treated as the only source of income of the assessee during the previous year relevant to the initial assessment year and to every subsequent assessment year upto and including the assessment year for which the determination is to be made. There is thus no doubt that each unit, including a CPP, has to be seen independently as separate and distinct from each other and as units for the purposes of grant of deduction under section 80IA of the Act.
where the assessee deserves profits from multiple units, all being eligible for deduction under Chapter VIA, the profits or losses arising from the respective units have to be considered in totality and only if the resultant figure were positive, would the assessee be entitled to its claim. Thus, the judgment considers the interplay between the income and losses arising from eligible units alone, all of which are eligible for deduction under Chapter VIA, and would not apply to the facts and circumstances of the present case whether the claim under Section 80I was restricted only to the 16 MW unit at Karnataka. Mr.Senthil Kumar, fairly, does not dispute this position.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
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