1992 (4) TMI 17 - HC - Income Tax

Deduction U/Ss 80J And 80HH, Depreciation, Foreign Exchange, New Industrial Undertaking, Scientific Research

Summary

Issues:
1. Depreciation on roads, walls, and fences.
2. Extra shift allowance on water system and sanitation.
3. Depreciation on capitalised loss due to fluctuation in foreign exchange rates.
4. Deduction under section 35(1)(iv) for capital work-in-progress, machinery, and equipment.
5. Deduction under section 80J including the value of capital assets.
6. Interpretation of profits and gains from new undertakings under sections 80J and 80HH.

Analysis:

Depreciation on Roads, Walls, and Fences:
The court referred to previous decisions to resolve this issue, stating that it is covered by established precedents.

Extra Shift Allowance on Water System and Sanitation:
Similarly, this issue was resolved by citing a previous decision in favor of the assessee.

Depreciation on Capitalised Loss due to Fluctuation in Foreign Exchange Rates:
The court relied on a prior judgment to decide in favor of the assessee, citing relevant legal provisions and interpretations.

Deduction under Section 35(1)(iv) for Capital Work-in-Progress:
Based on a previous court decision, the issue was resolved in favor of the assessee, providing clarity on the interpretation of the law.

Deduction under Section 80J including the Value of Capital Assets:
The court analyzed the provisions of section 80J and related sections to determine the treatment of capital assets in the deduction calculation. The court rejected the Revenue's argument and ruled in favor of the assessee.

Interpretation of Profits and Gains from New Undertakings:
The court examined the application of section 80AB in relation to sections 80J and 80HH to determine the computation of profits and gains from new undertakings. Despite the complex language of the law, the court upheld the Tribunal's decision in favor of the Revenue.

In conclusion, the court provided detailed analyses for each issue raised in the references under consideration, citing relevant legal provisions, precedents, and interpretations to deliver a comprehensive judgment on each matter.