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2009 (3) TMI 511 - HC - Income TaxIndustrial undertaking-Special deduction- petitioners, under section 80-IB of the Act, industrial undertakings located in a industrially backward State specified in Eighth Schedule to the Act are eligible for 100 per cent. According to the petitioners, their units are entitled to the aforesaid deductions. The petitioners further contend that section 115JB of the Act which seeks to impose tax at the rate of 7.5 per cent. of the book profit of an industrial unit like the petitioners which are situated in a notified industrially backward area is illegal and unconstitutional as it seeks to override the benefits granted under section 80-IB. Held that- the doctrine of promissory estoppel could not be made applicable to the nullity legislature exercise inasmuch as the legislature could not be estopped from exercising its power so long as such exercise was in conformity with the provisions of seventh schedule to the constitution and it did not transgress the fundamental rights guaranteed by Part III of the constitution. By enacting the provisions of section 115JB, the legislature had restricted the benefits of deduction under section 80-IB by making industrial units like those of the assessees liable to tax at the rate of 7.5% of the book profits. Curtailment of benefit earlier granted by the legislative act could not be invalidated on the principles of promissory estoppels.
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