COMMISSIONER OF INCOME-TAX vs. KAMDAR ASSOCIATES

ITR/190/1994HC GujaratGJHC24020266199411 October 2005Author: HONOURABLE MR. JUSTICE D.A.MEHTA,HONOURABLE MS. JUSTICE HARSHA DEVANI3 pages
AI SummaryRemanded

What were the facts?

The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench 'B', referred a question of law to the High Court of Gujarat at Ahmedabad. The reference was made at the instance of the Commissioner of Income-tax (Revenue) against Kamdar Associates (Assessee). The assessee is engaged in ship breaking activity. The dispute concerns the allowability of deductions under Sections 80HHA and 80I of the Income-tax Act, 1961, which are available to industrial undertakings. The Revenue challenged the ITAT's decision that the assessee qualified as an industrial undertaking for these deductions.

What did the High Court hold?

The High Court, by referring to its own decision in Commissioner of Income-tax Vs. Vijay Ship Breaking Corporation, [2003] 261 ITR 113 (Guj.), answered the referred question in the negative, in favour of the Revenue and against the assessee. The reasoning is that the issue of whether a ship breaking activity constitutes an industrial undertaking for the purpose of deductions under Sections 80HHA and 80I has been decided by the Court in the cited precedent. The operative direction is that the reference stands disposed of accordingly, with no order as to costs. Leave to appeal to the Supreme Court was granted, noting that the Apex Court had already granted leave in matters involving identical issues.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the appellate Tribunal was right in holding that the assessee company which was engaged in ship breaking activity, is an industrial undertaking and hence deduction under Section 80HHA is allowable? 2. Whether, on the facts and in the circumstances of the case, the appellate Tribunal was right in holding that the assessee company which was engaged in ship breaking activity, is an industrial undertaking and hence deduction under Section 80I is allowable? Contentions: Assessee: Not recorded in the judgment. Revenue: Not recorded in the judgment, however, the Revenue's advocate referred to a decision of the High Court in Commissioner of Income-tax Vs. Vijay Ship Breaking Corporation, [2003] 261 ITR 113 (Guj.) to submit that the issue stands concluded against the assessee.

Which sections of the Income-tax Act were involved?

Section 256(1),Section 80HHA,Section 80I,Section 261

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
ITR/190/1994 1/3 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD INCOME TAX REFERENCE No.190 of 1994 For Approval and Signature: HONOURABLE MR.JUSTICE D.A.MEHTA Sd/- HONOURABLE MS.JUSTICE H.N.DEVANI Sd/- ===================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ===================================================== COMMISSIONER OF INCOME-TAX - Applicant(s) Versus KAMDAR ASSOCIATES - Respondent(s) ===================================================== Appearance : MR MANISH R BHATT for Applicant(s) : 1, MR BD KARIA for MR RK PATEL for Respondent(s) : 1, ===================================================== CORAM : HONOURABLE MR.JUSTICE D.A.MEHTA and HONOURABLE MS.JUSTICE H.N.DEVANI Date : 11/10/2005

(Per : HONOURABLE MR.JUSTICE D.A.MEHTA)

1.

The Income-tax

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