Case Law Details
CIT Vs Usha Infrasystems (Himachal Pradesh High Court)
Himachal Pradesh High Court held that benefit u/s 80IC not available when only small part of entire process is carried out at unit and other process is outsourced.
Facts-
The respondent had begun production of Foundation Anchor Rods for Windmills w.e.f. 29.06.2004 in Industrial Area Parwanoo. The assessee, for the first time, claimed 100% deduction on the income u/s. 80IC(2)(ii) of the Income Tax Act, 1961. AO denied the deduction.
AO and CIT(A) concurrently held that since the substantial process involved in production of Anchors was being got done by the assessee from Ludhiana on work order basis and only a small part of it was being done at Parwanoo, the assessee could not be said to have the necessary qualification to avail deduction under Section 80IC of the Act. The ITAT, however, reversed such findings and held the assessee eligible for deduction under the aforesaid provision of the Act.
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