whether relief u/s 80J of the Income-tax Act, 1961, is admissible in a case where there is an expansion of an existing industrial unit - Income Tax - 904/CBDT

INSTRUCTION NO. 904/CBDT Dated : December 16, 1975 Section(s) Referred: 80J Statute: Income - Tax Act, 1961 Attention is invited to Board's Circular No. 68(1)IT/50 dated the 1 April, 1950 clarifying the circumstances under which relief u/s 15C of the Indian Income-tax Act, 1922 was admissible. A copy of the circular is enclosed for ready reference. 2. The provision corresponding to Section 15C was section 84 in the Income-tax Act, 1961 which has been replaced by Section 80J from 1-4-1968. 3. The question whether relief u/s 80J of the Income-tax Act, 1961, is admissible in a case where there is an expansion of an existing industrial unit has been examined by the Board in consultation with the Ministry of Law. The Board are advised that there is in law a clear distinction between the establishment of a new undertaking and the expansion of an existing one, even though it might be a substantial one. The Board desires that while considering the cases of deduction u/s 80J, the Income-tax Officer should go into the facts of each case very carefully and allow the deduction only when it is established that a new industrial undertaking has been formed. 4. These instructions may be brought to the notice of all officers working in your charge.