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Section 80J of the Income-tax Act, 1961 - Deductions - Profits and gains from newly established industrial undertakings - Whether capital employed means written down value of assets and not total cost of acquisition of assets for purpose of relief under section 80J - Held, yes Facts In the relevant assessment year the ITO allowed relief under section 80J on the written down value of the assets. The assessee claimed that the capital employed meant the cost of acquisition of the assets and not the written down value of the assets for purposes of relief under section 80J. On reference : Held Under rule 19A(2)( i) of the Income-tax Rules, 1962 in determining the value of the assets for computation of capital employed, if the assets are entitled to depreciation, their written down value would be taken into account. The written down value of the asset has to be determined in accordance with the Act. In the case of assets acquired during the accounting year, written down value means the actual cost of the assets. In the case of the assets acquired before the accounting year written down value means the actual cost of acquisition less the aggregate of all deductions of depreciation actually allowed in the past years to the assessee. The assessee's claim, could not, therefore, be allowed. Cases referred to CIT v. Bharat General & Textile Industries Ltd. [1986] 157 ITR 158 (Cal.), Indian Aluminium Co. Ltd. v. CIT [IT Reference No. 90 of 1981] Brooke Bond India Ltd. v. CIT [1983] 140 ITR 272 (Cal.) and Molins of India Ltd. v. CIT [1983] 141 ITR 317 (Cal.). Dr. D. Pal, P.K. Pal and Miss M. Seal for the Applicant. M.L. Bhattacharya for the Respondent. JUDGMENT Sen, J. - In this reference under section 256(1) of the Income-tax Act, 1961 ('the Act') the following questions have been referred as questions of law arising out of the order of the Tribunal for the opinion of this Court: "1.Whether, on the facts and in the circumstances of the case, the sum of Rs. 5,75,251 was allowable as a revenue loss having regard to the provisions of section 43A of the Income-tax Act, 1961 ? 2. Whether, on the facts and in the circumstances of the case, the capital employed should mean the…

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