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TMI Blog2022 (6) TMI 1241X X X X Extracts X X X X X X X X Extracts X X X X ..... s order of the Assessing Officer and 44 pages order of the Ld. CIT(A). 3. The assessee during the year has claimed deduction of Rs.2,22,05,954/- @ 100% of Profits and gains of the undertaking u/s 80IC of the Income Tax Act, 1961. The firm is located at Plot No. 172-174, Village-Katha, District, Baddi, Tehsil Nalagarh, Himachal Pradesh, in the area notified for the purpose of 80IC deduction. The initial assessment year in which the deduction claimed was AY 2008-09 and the assessee has commenced operational activity from 01.10.2007. This is the sixth assessment year from 2008-09, for which assessee is claiming deduction u/s 80IC of the Act. Assessee has made substantial expansion of its plant and machinery from 30.03.2012 on which value of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nit commence the operation in previous year 2007-08 relevant to A. Y 2008-09 hence treated as initial year here in the instant case of the assessee. By virtue of commence the operation and fulfilling the other conditions mentioned in the section, the assessee firm become eligible for claiming the deduction under section 80ICfor the first five years (ie. 2007-08 to 2011-12) @100% accordingly claimed deduction u/s 80ICfrom the A.Y. 2008-09 by declaring it to be its initial A. Y. for claimed of deduction. III. The assessee firm has claimed the deduction of Rs.22,266,360.14/- u/s 801C of the I.T. Act. Further to clarify the profits so taken up and derived is exclusively from a unit set up at the SEZ. In that profit neither any amount of profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2010-11 the rate of deduction would be increased to 100% 5. The issue of allowability of 100% deduction u/s 80IC after substantial expansion has been a matter of adjudication by the Co-ordinate Bench of the ITAT, Chandigarh, High Court of Himachal Pradesh, jurisdictional High Court of Delhi, Hon'ble Apex Court and by the Hon'ble Apex Court in the review petition. 6. The Himachal Pradesh High court reversed the verdict of the Hycron Electronics vs. ITO [2016] 69 taxmann.com 69(Chandigarh ITAT) and accordingly allowed the re-fixation of the initial assessment year after the substantial expansion from the immediately preceding assessment year in which the expansion has taken place. 7. The Revenue dismissed the appeal of the assessee b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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