TMI Blog1995 (12) TMI 386X X X X Extracts X X X X X X X X Extracts X X X X ..... cular F. No. 15/6/63/IT/A-2 dated 13th December, 1963 issued by the Board under section 84 of the Act, which was omitted by the Finance (No. 2) Act, 1967, with effect from 1st April, 1968 ? 2. Whether, on the facts and in the circumstances of the case and on a correct interpretation of the provision of section 80J(4)(ii) of the Income-tax Act, 1961, the Tribunal was correct in law in holding that the Board's Circular F. No. 15/5/63/IT/A-1 dated 13th December, 1963 relating to section 84 of the Act (Since omitted) would equally apply to section 80Jof the Act ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in directing the Income-tax Officer to examine the assessee's claim f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see moved the Tribunal. The Tribunal, on examination of the facts and the circumstances of the case and taking into account particularly the Board Circular F. No. 15/5/63 - IT(AI), dated 13-12-1963, which was issued in relation to section 84 of the Act, in this connection had held that : 10. We have examined the matter. The lower authorities have rejected the assessee's claim under section 80J because its case is hit by the pro visions of section 80J(4)(ii). However, the Board Circular referred to supra is directly on the point, and according to it in the case of the type under consideration, the claim for deduction under section 84 is admissible. The provisions of section 80J are in material respects, identical with those of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able by an assessee on so much of the profits and gains derived from any industrial undertaking or business of a hotel or from any ship, to which this section applies, as does not exceed six per cent per annum on the capital employed in such undertaking or business or ship, computed in the prescribed manner. (2) This section applies to any industrial undertaking which fulfills all the following conditions, namely :- (i)it is not formed by the splitting up, or the reconstruction of a business already in existence; ( ii)it is not formed by the transfer to a new business of a building, machinery or plant previously used for any purpose ; (iii)it manufactures or produces articles or operates one or more cold storage plants, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed up to the eighth assessment year commencing with the assessment year in which the industrial undertaking started producing articles or operating a cold storage plant or the ship was brought into use by the Indian company for the purpose of its business or, as the case may be, the business of the hotel started functioning. The 'deficiency' in the 'tax holiday' benefit is the amount by which the profits and gains derived from the industrial undertaking or ship or business of the hotel in each year falls short of six per cent, of the capital employed in the business. While the carry-forward and allowance of deficiency is, as stated above, permissible up to the 8th assessment year from the year of commencement of the bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see as provided in the said circular and accordingly it is beyond the scope of the reference to determine whether the said circular is a law and whether the said circular is binding upon the Courts. These questions are beyond the scope and ambit of this reference. 8. Mr. Prasad, led by Mr. P.K. Mullick, submitted that the said circular could not be made applicable in the facts and the circumstances of the case as it has been rightly pointed out by the Commissioner that the said circular was issued in connection with the relief under section 84, not in connection with the section 80J. We are unable to accept this position in view of the fact that not only the two sections are in pari materia, section84 has since been deleted and has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant benefit for a period of five years and if the benefit has been enjoyed for a period of less than five years in respect of the said plants and machinery, in that event, the successor would be entitled to the benefit of the residual period or, in other words, if an industry has been set up with certain plant and machineries and that plant and machineries have been used for three years by the company, and the successor and the successor-company which has taken over the said plant and machinery as a going concern with all the assets and liabilities, the said business is continued; in that event, the residuary period of two years' benefits would be available in respect of the plant and machineries used by the successor. It is not the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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