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TMI Blog1983 (8) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... al silk fabrics. The assessee had an industrial unit which was used for spinning and weaving. Till Unit No.2 was commissioned, bleaching, dyeing printing work was being done by outsiders. In the assessment year relevant to the accounting year ended 30th June, 1976, the assessee established a Unit in which the work done by outsiders was done by the assessee itself. The assessee claimed deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the ITO also held that even if the assessee was entitled to the deduction, only the net value of the assets could be considered as capital employed. 3. The CIT(A) held that the assessee was eligible for the deduction. 4. We are of opinion that the CIT(A)'s order is correct. The first reason given by the ITO is that dyeing printing cannot form a manufacturing activity. However, the Punjab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is based on the fact that an old building used by another undertaking is now part of the new unit. It is true that before the amendment in 1976, if the assessee had made use of any old building, the assessee would not be entitled to the deduction. But, w.e.f. 1st April, 1976, the second provision to s. 80J(4) has taken care of this situation. This proviso now states that where any building or any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aware of this decision. He had tried to distinguish it, but we do not find any distinguishing feature. We are of opinion that the Gujarat High Court Decision would apply and, therefore, the disability of the assessee stands removed. 6. The third reason given by the ITO arises from the common funds utilized. This point has been considered by the Tribunal when this matter had come up before the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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