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2015 (3) TMI 649 - HC - Income TaxDisallowance of deduction u/s 80-IA - AO held that since there was sale of going concern and formation of Private Limited Company, there was capital gain, for which tax was liable to be paid by the assessee under Section 50-B of the Act and disallowed the deduction claimed by the assessee under Section 80-IA - Tribunal allowed the claim - Whether the assessee is entitled for claiming deduction under Section 80-IA when more than 20% of old plant and machinery were used in the reconstructed unit as contemplated under Sub-section (3) of Section 80-IA? - Held that:- In order to claim deduction under Section 80-IA assessee has to satisfy that Industrial undertaking must be set up on or after 01.04.1991 and before 31.03.1995.Industrial undertaking is not formed by splitting up or reconstruction of a business already in existence (subjected to certain other conditions as specified in Section 80-IA.)The transferred assets of old business should not exceed 20% of the total value of the machinery or plant used in the new business. & It should not manufacture or produce articles specified in the Eleventh Schedule. The records placed for perusal show that the assessee has not fulfilled the above conditions and therefore, the Assessing Officer and the Appellate Authority had rightly disallowed the benefit. The Tribunal without any just and cogent reasons has reversed the orders passed by the Assessing Officer as confirmed by the Appellate Authority. The Tribunal while setting aside the order of the Appellate Authority has erroneously held that the unit established in Shed No.C-54 is a new unit and the products manufactured in both the units are identical. Thus, the findings of the Tribunal in setting aside the concurrent orders of the Assessing Officer as well as the Appellate Authority are unsustainable in law. - Decided in favour of revenue.
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