1986 (11) TMI 137

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..... s that s. 80-I deduction follows s. 80-HH deduction under Chapter 6A and both these sections emphasised on deduction to be calculated at 20 per cent of the profits and gains of the undertaking. The Department, however, is restricting the deduction under s. 80-I at 20 per cent of the income arrived at after deduction of the amount of relief under s. 80-HH. The assessee, therefore, prayed that the o .....

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..... ssessee from such profits and gains of the undertaking of amount equal to 20 per cent thereof. The sections do not anywhere mention that the deduction to be allowed is 20 per cent of the income computed in accordance with the provisions of the act after the relief contained upto Chapter 6A. The s. 80HH(9) only provides that when a concern is entitled to deduction under s. 80HH, s. 80-I and or s. 8 .....

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..... ertaking which would mean only the commercial profits. Therefore the assessee is entitled to relief under s. 80-I to the tune of 20 per cent of the profits as per its profits loss account without taking into account the depreciation and excluding the provision for income-tax as well as the investment allowance. The ITO is directed to recompute the claim in accordance with the observations made a .....

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