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2017 (12) TMI 129 - HC - Income TaxBenefit of Section 80-IC - proof of income derived from business - income earned by way of interest - scope of the term business u/s 2(13) r.w.s 28(i) - Held that:- Both in Sections 80HH and 80-IC, the Legislature has chosen to employ the word “derived” as distinguished from “attributable to”. Had the Legislature used the words “attributable to”, then it would have a much wider effect and it may have encompassed within itself, the income, which is the subject matter of controversy before us. But insofar as a narrow concept has been contemplated by the Legislature for the purpose of grant of benefit of deduction under Section 80-IC, we would think that with regard to the fact that interest, which is earned by the appellant, has nothing to do with carrying on of the business per se, namely, manufacture and sale of the articles in question, the appellant would not be entitled to the benefit of deduction. Undoubtedly, in Section 2 (13) of the Act, “business” is defined. A definition clause is, undoubtedly, to be considered when interpreting a Statute, but it is always subject to the context being otherwise. We may notice in this regard Section 28 of the Act, which provides for the income coming under the heading ‘Profits and gains of business or profession’. We may notice Section 28(i) of the Act, which provides as follows: “28. Profits and gains of business of profession.-The following income shall be chargeable to income-tax under the head “profits and gains of business or profession”,- (i) the profits and gains of any business or profession which was carried on by the assessee at any time during the previous year;” Contrast the words used in Section 28 (i), it does not use the word “derive”; it also does not specify any particular business as such. The entire income from trade and business would be reckoned under the heading ‘business income’. In other words, under Section 80-IC, a person, an enterprise or an undertaking is entitled to take the benefit of Section 80-IC only insofar as it carries on business, which is mentioned in sub-section (2) of Section 80-IC and derives profits and gains therefrom. - Decided against the assessee
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