Law: Income Tax Act, 1961

Section: 84

(a) Income-tax----New industrial undertaking---Relief---Part of equipment installed in new unit by 31-3-1957 and the balance in February, 1958---Relief not allowable partially as and when fresh equipment came to be added---Assess entitled to relief in assessment yew 1957-58 and four succeeding years claim for relief assessment year 1957-58---Assessee not entitled to relief in assessment year 1962-63- Indian Income-tax Act, 1922, S. 15C ---Indian Income Tax pct, 1961, S. 84. The appellant was manufacturing caustic soda utilising billiter up to the Year 1956, its production capacity was 13.5 tons per day. The appellant obtained a licence which permitted it to manufacture 20 tons of caustic soda per day. In order to increase the capacity, the appellant gradually replaced billiter cells with hooker cells. Thirty hooker cells were installed by March 31, 1957, and thirty more were installed in February, 1958. The installation of the hooker cells required a change over in the power system and the installation of a rectifier was completed in the year ended on March 31, 1959. However, the hooker cells were utilised for the production as and when they were installed by a suitable adjustment in the power system even before the rectifier was installed. The position, thus, was that the production for the year ended. March 31, 1957 included certain production attributable to the use of thirty hooker cells. All the sixty hooker cells were installed by the end of 1958 and the installation of the unit together with the rectifier was also completed in the year ended on March 31,1959. The capacity of the unit gradually increased from the stage of the installation of the hooker cells, though full capacity was reached only with the installation of all the hooker cells. The appellant claimed before the Income-tax Officer that it was entitled to the relief under section 84 of the Income Tax Act, 1961, in respect of the assessment year 1962-63 on the ground that such relief was admissible for five assessment years starting from the year in which the industrial undertaking began to manufacture or produce articles. The contention of the appellant was that it had not claimed any relief…

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