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“eligible business”

DeductionsSection 80IASection 80IA975 judgments

The decision most relied on for eligible business is Totgars Co-operative Sale Society Ltd. v. ITO (322 ITR 283), cited in 1,283 judgments on BharatTax.

Leading authorities on eligible business

Totgars Co-operative Sale Society Ltd. v. ITO
322 ITR 283 · 2010 · Supreme Court
1,283
citing judgments

The interest income earned by a cooperative society from investing its surplus funds in fixed deposits with banks is not "derived from" its eligible business activities and is taxable as "income from other sources" under Section 56, thus not qualifying for deduction under Section 80P.

State Bank Of India v. CIT
389 ITR 578 · 2016 · High Court
817
citing judgments

Income arising from a cooperative society's surplus funds invested in short-term deposits and securities is not attributable to the society's core activities and, therefore, is not eligible for exemption under Section 80P(2)(a)(i) of the Income-tax Act.

Liberty India v. CIT
317 ITR 218 · 2009 · Supreme Court
571
citing judgments

The Supreme Court clarified that for profits and gains to be eligible for deductions under sections like 10B, 80IA, or 80IB, the income must be "derived from" or have a direct nexus to the eligible business activity. Income from incidental sources like the sale of scrips/licenses or interest on employee loans is generally not considered as derived from the eligible business for such deductions.

CIT v. Smifs Securities Ltd.
348 ITR 302 · 2012 · Supreme Court
540
citing judgments

Goodwill, whether arising from an amalgamation or a slump sale, is an intangible asset eligible for depreciation under Section 32(1) of the Income-tax Act. While the assessee must prove the existence and valuation of such goodwill, it is recognized as a depreciable asset.

Citizen Co-operative Society Ltd. v. ACIT
397 ITR 1 · 2017 · Supreme Court
499
citing judgments

A co-operative credit society engaged in banking business with the general public, accepting deposits from non-members and advancing loans to non-members, is treated as a co-operative bank. Such a society falls under the exclusionary clause of Section 80P(4) and is not eligible for deduction under Section 80P(2)(a)(i).

Totgar's Co-operative Sale Society Ltd. v. ITO
188 Taxmann 282 · 2010 · Supreme Court
486
citing judgments

Interest income earned by a co-operative society from investments, particularly with co-operative banks, is not eligible for deduction under Section 80P as it is not attributable to the core business activities of the society and constitutes "other income", not "profits and gains of business".

Pandian Chemicals Ltd. v. CIT
262 ITR 278 · 2003 · Supreme Court
353
citing judgments

Income eligible for deduction under Section 80IA or 80IC must have a direct nexus with the eligible business activity of the industrial undertaking. Income merely incidental to the business, even if part of the assessee's overall business, is not considered "derived from" the eligible undertaking.

CIT v. Sterling Foods
237 ITR 579 · 1999 · Supreme Court
311
citing judgments

Income eligible for profit-linked deductions under sections like 80-IC or 10B must have a direct nexus to the eligible business activity or be derived from the industrial undertaking itself, and not merely attributable to it or arising from a post-manufacturing event.

Judgments citing eligible business

Kokan Mercantila Co Op Bank Ltd, Mumbai vs. ACIT Circle-20(2), Mumbai

In the result we set aside the orders of authorities below and direct to allow the deduction u/s

ITA 651/MUM/2022[2017-18]Status: DisposedITAT Mumbai04 Oct 2022AY 2017-18

Bench: Shri Kuldip Singh & Shri Gagan Goyalkokan Mercantile Co-Operative Bank Ltd. Harbour Crest, 1St Floor, Mazagaon, Mumbai-400010. Pan: Aaaak2527P ...... Appellant Vs. Acit, Circle-20(2), Room No. 217, 2Nd Floor, Piramal Chambers, Lalbaug, Parel, Mumbai-400012 ..... Respondent Appellant By : Sh. M. Subramanian, Adv. Respondent By : Sh. Tejinder Pal Singh, Sr.Dr Date Of Hearing : 12/07/2022 Date Of Pronouncement : 04/10/2022 Order Per Gagan Goyal, A.M: This Appeal By The Assessee Is Directed Against The Order Of National Faceless Appeal Centre, Delhi [Hereinafter Referred To As [‘Nfac’] Dated 21.12.2021 Passed Under Section 250 Of The Income Tax Act, 1961 (Hereinafter Referred To As [‘The Act’] For The Assessment Year (Ay) 2017-18. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Sh. M. Subramanian, AdvFor Respondent: Sh. Tejinder Pal Singh, Sr.DR
Section 142(1)Section 143(2)Section 234BSection 234CSection 250Section 36(1)

respect of any special reserve created and maintained by a specified entity, an amount not exceeding twenty per cent of the profits derived from eligible business computed under the head "Profits and gains of business or profession" (before making any deduction under this clause) carried to such reserve account: Provided ... primary co-operative agricultural and rural development bank. (v) a housing finance company; and (vi) any other financial corporationincluding a public company. (b) "Eligible business" means, — [(i) in respect of the specified entity referred to in sub-clause (i) or sub- clause (ii) or sub-clause (iii) or sub-clause

DCIT -CC- 8(4), Mumbai vs. Bermaco Energy System Ltd., Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 3752/MUM/2018[2008-09]Status: DisposedITAT Mumbai30 Sept 2022AY 2008-09

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

DCIT -CC- 8(4), Mumbai vs. Bermaco Energy System Ltd., Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 3751/MUM/2018[2007-08]Status: DisposedITAT Mumbai30 Sept 2022AY 2007-08

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

DCIT - CC - 8(4), Mumbai vs. Bermaco Energy System Ltd., Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 3750/MUM/2018[2010-11]Status: DisposedITAT Mumbai30 Sept 2022AY 2010-11

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

DCIT -CC -8 (4), Mumbai vs. Bermaco Energy System Ltd., Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 3749/MUM/2018[2009-10]Status: DisposedITAT Mumbai30 Sept 2022AY 2009-10

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

Bermaco Energy System Limited, Mumbai vs. DCIT, CC- 47, Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 2854/MUM/2018[2009-10]Status: DisposedITAT Mumbai30 Sept 2022AY 2009-10

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

Bermaco Energy System Limited, Mumbai vs. DCIT - CC- 47, Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 2853/MUM/2018[2008-09]Status: DisposedITAT Mumbai30 Sept 2022AY 2008-09

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

Bermaco Energy System Limited, Mumbai vs. DCIT- CC-47 Mumbai, Mumbai

In the result, appeals filed by the Revenue are dismissed and the appeals filed by the assessee are dismissed

ITA 2852/MUM/2018[2007-08]Status: DisposedITAT Mumbai30 Sept 2022AY 2007-08

Bench: Shri B.R. Baskaran () & Smt. Kavitha Rajagopal ()

Section 132Section 143(3)Section 153ASection 250Section 44A

bogus purchases by applying the provisions of section 44AD without appreciating the fact that the assessee is neither an eligible assessee nor carrying out eligible business in terms of section 44AD of the Act. The Revenue has also challenged the ground of deletion of bogus purchases by relying

Dy CIT Circle-3, Thane vs. M/S Pushpa Developers Co., Thane

In the result, we dismiss this ground of appeal filed by the Revenue

ITA 55/MUM/2021[2011-12]Status: DisposedITAT Mumbai27 Sept 2022AY 2011-12

Bench: Shri Prashant Maharshi () & Kavitha Rajagopal () Deputy Commissioner Of Income- Vs M/S Pushpa Developers Company Tax, Circle-3, Thane G-8, Vanraj Chs Ltd, Near Forest Room No.02, 6Th Floor, B-Wing, Colony, Kopri, Thane (E)-400 601 Ashar It Park, Wagle Industrial Pan : Aadfp5631M Estate, Thane(W)-400 604 Appellant Respondent

Section 143(3)Section 250Section 80I

sale of TDR which was disallowed by the Assessing officer on the ground that deduction under section 80IB(10) was available only to eligible business and the profit must have been derived from developing and building housing projects. The Assessing Officer further stated that the TDR was generated ... derived directly from the development of the assessee’s project and that the assessee has not derived the said TDR from the eligible business of developing and building of housing projects. The Ld.DR stated that the assessee is not entitled to deduction under section 80IB(10) on this ground

Asst CIT 27(2), Navi Mumbai vs. Merit Magnum Construction, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 6657/MUM/2016[2010-11]Status: DisposedITAT Mumbai23 Sept 2022AY 2010-11

Bench: Shri Amit Shukla & Shri Gagan Goyal

For Appellant: Sh. Paresh ShapariaFor Respondent: Sh. Mahiita Nair, CIT-DR
Section 292CSection 68Section 69CSection 801BSection 801B(10)Section 80I

interest income credited to P&L A/c. is more than the profits declared. Therefore in such case as there is no profit from the eligible business, the assessee is not entitled for deduction u/s 80 IB (10) of the Act. In view of the same the AO treated the interest

ITO 2(3)(3), Mumbai vs. Zensar Technologies Ltd, Mumbai

In the result, appeal by the assessee is allowed for statistical purpose

ITA 955/MUM/2013[2002-03]Status: DisposedITAT Mumbai14 Sept 2022AY 2002-03

Bench: Shri G.S. Pannuand Shri Sandeep Singh Karhail

For Appellant: Shri Mihir NaniwadekarFor Respondent: Shri Anil Kumar Das
Section 10ASection 115JSection 143(3)Section 250Section 263Section 80HSection 92C

held that in para 12 & 13 thereon that the profit eligible for deduction would be net profit made by the assessee from the eligible business and such deduction is to be allowed from gross total income. We find that similar view has been taken by the Hon‟ble Jurisdictional High

Zensar Technologies Ltd, Mumbai vs. ACIT 2(3), Mumbai

In the result, appeal by the assessee is allowed for statistical purpose

ITA 276/MUM/2013[2002-03]Status: DisposedITAT Mumbai14 Sept 2022AY 2002-03

Bench: Shri G.S. Pannuand Shri Sandeep Singh Karhail

For Appellant: Shri Mihir NaniwadekarFor Respondent: Shri Anil Kumar Das
Section 10ASection 115JSection 143(3)Section 250Section 263Section 80HSection 92C

held that in para 12 & 13 thereon that the profit eligible for deduction would be net profit made by the assessee from the eligible business and such deduction is to be allowed from gross total income. We find that similar view has been taken by the Hon‟ble Jurisdictional High

DCIT Cent. Cir. 5(2), Mumbai vs. Ipca Laboratories Ltd., Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 5227/MUM/2016[2010-11]Status: DisposedITAT Mumbai29 Aug 2022AY 2010-11

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Ipca Laboratories Ltd, Mumbai vs. DCIT Ltu, Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 3811/MUM/2016[2010-11]Status: DisposedITAT Mumbai29 Aug 2022AY 2010-11

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Asst CIT (Ltu) 1, Mumbai vs. Ipca Laboratories Ltd, Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 3691/MUM/2016[2009-10]Status: DisposedITAT Mumbai29 Aug 2022AY 2009-10

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Ipca Laboratories Ltd, Mumbai vs. Asst CIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 3597/MUM/2016[2009-10]Status: DisposedITAT Mumbai29 Aug 2022AY 2009-10

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

DCIT (Ltu) 1, Mumbai vs. Ipca Laboratories Ltd, Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 2815/MUM/2015[2010-11]Status: DisposedITAT Mumbai29 Aug 2022AY 2010-11

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Ipca Laboratories Ltd, Mumbai vs. Asst CIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 2493/MUM/2015[2008-09]Status: DisposedITAT Mumbai29 Aug 2022AY 2008-09

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Ipca Laboratories Ltd, Mumbai vs. DCIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 3267/MUM/2012[2007-08]Status: DisposedITAT Mumbai29 Aug 2022AY 2007-08

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered

Ipca Laboratories Ltd, Mumbai vs. ACIT (Ltu), Mumbai

In the result, appeal filed by the learned assessing officer is dismissed

ITA 8120/MUM/2010[2005-06]Status: DisposedITAT Mumbai29 Aug 2022AY 2005-06

Bench: Shri Prashant Maharishi, Am & Shri Pavan Kumar Gadale, Jm

For Appellant: Shri F.V. Irani, ARFor Respondent: Shri Sumit Kumar, DR
Section 801BSection 801CSection 80ISection 92C

Section 80IC and 80IB of the Act. Provision of Section 80IC of the Act allows deduction of profit and gains derived by undertaking from eligible business. It cannot said that sale of empty containers is altogether different business of the assessee. We further held that this issue is squarely covered