2012 (9) TMI 664 - SCH - Income Tax

Whether the assessee was entitled to investment allowance under Section 32A(2)(b) - Held that - The AO came to the conclusion that the assessee claimed to be in the business of mining & the only activity undertaken by it was removal of overburden/earth excavation work carried out for facilitating mining at lignite project site at Rajpardi and Pandhro and that the assessee was merely a labour contractor. These findings of fact have been upheld by the Income Tax Appellate Tribunal and they have not even been discussed in the impugned judgment of the High Court 2006 (8) TMI 144 - GUJARAT HIGH COURT - against assessee.

Summary

The Supreme Court allowed the civil appeal filed by the Department for Assessment Year 1987-1988 regarding investment allowance under Section 32A(2)(b) of the Income Tax Act, 1961. The court found that the assessee was not entitled to the allowance as they were deemed to be a labour contractor. The appeal was allowed with no costs.