2015 (4) TMI 627

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..... PEN COURT) 1. The question of law framed by this Court for decision in this appeal is: "Whether relationship of master and servant is necessary to claim deduction under 80I of the Income Tax Act, 1961?" 2. The appellant concededly employed and utilised the services of workers through the contractor Buta Singh. At the relevant time during the assessment year 1986-87, the appellant employed 18 w .....

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..... ed at least ten workers whether casual or regular the appellant will have to satisfy the requirement that at least 10 workers were engaged in the manufacturing process. From the order of the ACIT it is not clear as to whether this requirement was satisfied while claiming the deduction under section 80I. The ITO will, therefore, look into the claim of the assessee for deduction under section 80I an .....

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..... ns cannot be treated as employees of the assessee company. Finding given in this regard by the assessing officer is correct in my opinion. Accordingly, I reverse the order of the Commissioner of Income Tax (Appeals) and restore that order of the assessing officer." 4. This Court has carefully considered the grounds of appeal as well and heard the counsel for the revenue. Section 80I enables deduc .....

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..... involved in inter alia, production of articles or things and should employ 10 or more workers in manufacturing process carried on with the aid of power or in a manufacturing process carried on without the aid of power, employ 20 or more workers. Considering that the provision is a beneficial one and meant to provide relief to industrial undertaking involved in manufacturing. The restrictive interp .....

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..... received from the owner of the unit, could in fact be considered as profit derived from an industrial undertaking and thus be entitled for deduction under Section 80I. In other words, even though the ownership of unit, from which the profit was derived by the industrial undertaking claiming deduction under Section 80I, did not vest with it, the Court held that it was entitled to the said benefit. .....

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