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TMI Blog1988 (5) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... the circumstances of the case, the Tribunal is justified in upholding the order of the Appellate Assistant Commissioner that the relief under section 80J should be allowed for the full year although the factory ran for three months only ?" The relevant assessment year is 1971-72. For this period, the assessee claimed deduction at the rate of 6% on Rs. 17,65,121 under section 80J of the Income-tax Act, 196.. The Income-tax Officer however; allowed rebate only on the amount of Rs. 3,04,780. The Income-tax Officer took the view that relief under section 80J of the Income-tax Act, 1961, should be allowed without deducting the liabilities or the amount of subsidy from the capital employed in the business of the new industrial undertaking. Agg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Madras In several decisions have taken the consistent view that relief under section 80J should be allowed for the full year, even though the new industrial undertaking ran only for a portion thereof. These decisions are CIT v. Godrej Soaps Ltd. [1988] 169 ITR 537 (Bom), CIT v. Oyster Packagers (P.) Ltd. [1985] 152 ITR 471 (Cal), CIT v. Sarabhai' Sons Ltd. [1983] 143 ITR 473 (Guj), CIT v. Protein Products Ltd. [1987] 167 ITR 157 (Ker), CIT v. Mysore Petro Chemical Ltd. [1984] 145 ITR 416 (Kar), CIT v. Sanghi Beverages (P.) Ltd. [1982] 134 ITR 623 (MP), CIT v. Sanghi Bros. Ltd. [1988] 169 ITR 220 (MP), CIT v. Simpson and Co. [1980] 122 ITR 283 (Mad) and Rockweld Electrodes (India) Ltd. v. CIT [1986] 158 ITR 819 (Mad). It may also be mentio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the assessment year 1971-72, the assessee is entitled to relief to the extent of Rs. 6,08,147 under section 80J of the Act, the same being borrowed from the National Small Scale Industries Ltd. The question is whether this contention can be accepted. There are two conditions which must be satisfied before the assessee can get the benefit of rule 19A(3)(b) as it then existed. These conditions are: (i) that the money should have been borrowed from an "approved source" for the creation of a capital asset in India, and (ii) the agreement should provide for repayment thereof during a period of not less than seven years. For the purpose of this sub-rule, "approved source" is to be understood as defined in the Explanation given thereunder. Even ..... X X X X Extracts X X X X X X X X Extracts X X X X
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