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TMI Blog1996 (7) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... plicant was not entitled to relief under section 80J of the Act for the assessment year 1980-81 ?" I T. R. No. 97 of 1991 : "Whether the Income-tax Appellate Tribunal was right in law and on the facts in holding that the applicant was not entitled to carry forward the deficiency under section 80J of the Act in respect of the assessment year 1980-81 to the assessment year 1981-82 ?" The facts leading to the above references can briefly be stated thus : The assessee-company was originally engaged in the distribution of electricity in Cochin till December 3, 1980. However, the company started a new industrial unit for the manufacture and sale of valves and its commercial production started in the year 1975. The first accounting year fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revious year to the assessment year 1977-78 and as such there was no computation period for the purpose of section 80J. As far as the assessment year 1980-81 is concerned, the assessee's case is that since the assessment year 1977-78 got skipped on account of the change of the previous year from March to September, it was the fourth assessment year immediately succeeding the initial assessment year 1975-76. This contention was not accepted by the Income-tax Officer, the Commissioner of Income-tax (Appeals), Ernakulam and the Tribunal. The main point for consideration before the Tribunal was whether the assessee was eligible for deduction under section 80J for the assessment years 1980-81 and 1981-82. The Tribunal ultimately found that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the deduction specified in sub-section (1) shall be allowed in computing the total income in respect of the assessment year relevant to the previous year in which the industrial undertaking begins to manufacture or produce articles. Sub-section (2) does not say that new industrial undertakings are entitled to exemption for a period of five years. What the section provides is that after the commencement of the production the assessee is entitled to deduction for the initial assessment year and each of the four assessment years immediately succeeding the initial assessment year. In this case the date of commencement of the manufacture or production is not available. However, the initial assessment year is 1974-75 (1975-76 ?). The above prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -81. The fact that the assessee had changed with effect from April 1, 1976, the previous year or the financial year to the year ending September 30, and the previous year for the assessment year 197879 was consequently from April 1, 1976 to September 30, 1977, and there was no previous year for the assessment year 1977-78 will not advance the case of the assessee for claiming relief under section 80J for the assessment year 1980-81 also. It was only because there was no previous year for the assessment year 1977-78 and consequently there was no computation period for the purpose of relief under section 801 for that assessment year, that the assessee could not get any relief under section 80J for the assessment year 1977-78. The said positio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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