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2020 (11) TMI 948 - HC - Income TaxEntitled to deduction u/s 10B - Tribunal held that the Appellant's Unit 1 was not entitled to deduction for the assessment year 2008-09, on the basis that the ten consecutive assessment years for the purposes of the said provision would begin from the assessment year 1997-98, when the Appellant commenced manufacture, and not from the assessment year 1999-00 when the Appellant actually started claiming the relief under Section 10B - HELD THAT:- Section 10B of the Act prior to amendment by Income Tax (second Amendment) Act, 1998 with effect from 01.04.1999 granted tax holiday for a period of five years falling within a period of eight years beginning with the Assessment Year in which the manufacture / production of article or things has begun. Once an assessee began manufacture, it could choose the year from which it would start claiming deduction and from that year, it would be entitled for deduction for five consecutive years within a period of eight years. The assessee started manufacture in the Assessment Year 1997-98 but did not claim deduction under Section 10B of the Act, for that year as well as subsequent Assessment Year viz., 1998-99. For the first time, the claim for deduction under Section 10B of the Act was made for the Assessment Year 1999-2000. Ten year period would begin from the year in which assessee first claimed the deduction. Substantial question of law framed by a bench of this court is answered in favor of the assessee and against the revenue in the result, the order of the tribunal insofar as it holds that unit No.1 of the assessee is not entitled to deduction under Section 10B of the Act is hereby quashed.
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