SSI benefit cannot be availed by an undertakings which do not continue as SSI: SC

DCIT Vs. M/s. Ace Multi Axes Systems Ltd. (Supreme Court of India)

Issue-+When once the eligible business of an assessee is given the benefit of deduction under Section 80 IB on the assessee satisfying the conditions mentioned in sub-sec. (2) of Section 80 IB, can the assessee be denied the benefit of the said deduction on the ground that during the said 10 consecutive years, it ceases to be a small scale industry

Incentive meant for small scale industrial undertakings cannot be availed by industrial undertakings which do not continue as small scale industrial undertakings during the relevant period. Needless to say, each assessment year is a different assessment year, except for block assessment. It further held that Higher slabs of tax or higher tax burden on an assessee having higher income or higher capacity cannot in any manner, be considered unreasonable.

The assessee having not retained the character of ‘small scale industrial undertaking’, is not eligible to the incentive meant for that category. Permitting incentive in such case will be against the object of law.

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