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Section 80J of the Income-tax Act, 1961 - Deductions - Profits and gains from new industrial undertakings, ships or hotels - Assessment year 1975-76 - Assessee started woollen mill unit in February 1975 and claimed deduction under section 80J for entire year - Whether assessee was entitled to deduction under section 80J for entire year and not for part of year only in proportion to which machinery was used - Held, yes Circulars and Notifications: Circular No. 378 dated 3-3-1984 issued by Board of Revenue FACTS On 27-2-1975, the assessee started woollen mill unit. The question then arose whether relief under section 80J would be available to the assessee in respect of this new industrial undertaking for the whole year, when it was only during the last month of the accounting period that it was set up. The ITO held otherwise and allowed the relief for only one month. On appeal, however, the relief was granted for the whole year. The Tribunal upheld the appellate order. On reference: HELD In view of decision of this Court in CIT v. Bhushan Industrial Co. (P.) Ltd. [1989] 177 ITR 11 and Circular No. 378 of 3-3-1984 issued by the Board of Revenue, it was held that such relief under section 80J must be granted to the assessee for the whole year and not for part of the year only in proportion to which the machinery was used. Note: The case was decided in favour of the assessee. CASE REVIEW CIT v. Bhushan Industrial Co. (P.) Ltd. [1989] 177 IT reports 11 (P&H) followed & relied upon. CASES REFERRED TO CIT v. Bhushan Industrial Co. (P.) Ltd. [1989] 177 ITR 11 (Punj. & Har.) Ashok Bhan and Ajay Mittal for the Applicant. D.K. Gupta for the Respondent. JUDGMENT S.S. Sodhi, J.-The matter here relates to relief under section 80J of the Income-tax Act, 1961, and it pertains to the assessment year 1975-76. On February 27, 1975, the assessee, Kansal Hosiery Works, started a branch under the name of Kansal Hosiery Mills, Ludhiana (Woollen Mill Unit). The…

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