Law:

Section:

Section 80J of the Income-tax Act, 1961 - Deductions - Profits & gains from new industrial undertakings, ships, etc. - Assessment years 1968-69 and 1969-70 - Whether expression 'any profits and gains derived from a ship' occurring in section 80J(1) will have to be construed as profits and gains directly derived from that source and benefit of that provision cannot be availed of if assessee is using ship or ships as instruments for carrying on his business activity which produces income - Held, yes - Whether where travelers owned by assessee-company were used for catching fish in deep sea assessee would not be entitled to relief under section 80J(1) - Held, yes Words and phrases : Expression 'derived from a ship' as occurring in section 80J of the Income-tax Act, 1961. FACTS The assessee-company, using trawlers for its business of deep sea fishing claimed relief under section 80J for the assessment years 1968-69 and 1969-70. The ITO however, held that the trawlers were merely used as instruments for its business activity of catching fish and selling fish and that the assessee's total gross income did not include any profits and gains derived from a ship. On writ : HELD In the first place, sub-section (1) and sub-section (5) of section 80J cannot be read together. Sub-section (5) merely prescribed conditions which must be fulfilled by a ship. It was only after these conditions were satisfied by a ship that the question would arise as to whether the profits and gains earned by an Indian company owning the ship were 'derived from the ship' or not. Secondly, having regard to the scheme of the Act it would be reasonable to construe the expression 'profits and gains derived from a ship' occurring in sub-section (1) of section 80J as meaning profits and gains derived directly from a ship, that is to say, the ship must be the direct source of income and not a ship when it was used as instrument for carrying on business activity which produced the income. Further, the other two sources which have been included in sub-section (1) of section 80J would also indicate that the relief thereunder is conferred in respect of profits and gains which are derived directly from…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492