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| The Tax Publishers2020 TaxPub(DT) 5101 (Karn-HC) INCOME TAX ACT, 1961
Section 10B
Once an assessee began to manufacture, it could choose the year from which it would start claiming deduction and from that year, it would be entitled for deduction under section 10B for five consecutive years within a period of eight years.
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Deduction under section 10B - 100% EOU - Allowability - Factual year of deduction
The question arose for consideration was whether the Tribunal was right in holding that the assessee's Unit 1 was not entitled to deduction under section 10B on the basis that the ten consecutive assessment years for the purposes of the said provision would begin when the assessee commenced manufacture, and not when the assessee actually started claiming the relief under section 10B. Held: Once an assessee began to 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. Assessee started manufacture but did not claim deduction under section 10B for that year as well as subsequent assessment year. Thus, for assessee Ten-year period would begin from the year in which it first claimed the deduction.
REFERRED : CIT & Anr. v. M/s Deutsche Sotware Ltd. 2017 TaxPub(DT) 5468 (SC), CIT v. DSL Software Ltd. (2012) 18 taxmann.com 151 (Karn) : 2012 TaxPub(DT) 0702 (Karn-HC) and Dy. CIT v. Saint Gobain Crystals & Detectors (I) Ltd. [ITA No. 708/Bang/2013, dt. 11-5-2016].
FAVOUR : In favour of assessee
A.Y. : 2008-09
IN THE KARNATAKA HIGH COURT
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