9911796707
|
Home
Issues:
1. Whether the assessee is entitled to deduction under section 80J as an industrial undertaking? 2. Whether the certificate given by the auditors under rule 18C could be considered for allowing deduction under section 80J? Analysis: Issue 1: The case involved a poultry farm claiming deduction under section 80J as an industrial undertaking. The Income-tax Officer rejected the claim, stating that the business was covered under section 80JJ, not section 80J. The Commissioner of Income-tax (Appeals) upheld this decision. However, the Tribunal, following a previous decision, ruled in favor of the assessee, considering the mechanical process used in hatching chicks as industrial production. The High Court disagreed, stating that the mechanical process did not convert poultry farming into an industrial undertaking. The court emphasized that the production of chicks was a natural process aided by machinery and did not qualify as industrial production. The court also highlighted the distinction between sections 80J and 80JJ, indicating that the latter specifically addressed businesses like livestock breeding and poultry farming. Ultimately, the court ruled against the assessee, denying the deduction under section 80J. Issue 2: Regarding the second issue of whether the certificate under rule 18C could be considered, the court deemed it unnecessary to address this question due to the ruling on the first issue. As the court had already determined that the assessee was not entitled to deduction under section 80J, the consideration of the certificate became irrelevant. Therefore, the court declined to answer the second question, rendering it academic in light of the primary decision. The reference was disposed of accordingly, with no order as to costs in the case. This detailed analysis of the judgment outlines the key arguments, legal interpretations, and the court's reasoning behind its decision on each issue presented before the High Court.
|
