Counsel For The Revenue Has Very Fairly Accepted That Theissue In This Case Is Squarely Covered Against It In The Judgment Of Theapex Court Incommissioner Of In v. Aarham Softrontics,Ciwil Appeal

ITA 236 of 2018 (O&M) 104IN THE HIGH COURT OF PUNJAB AND HARYANA|AT CHANDIGARH ITA 236 of 2018 (O&M)Date of decision : 09.07.2019 Pr. Commissioner of Income Tax-2, Chandigarh ...... Appellant VeTSuU M/s Health Biotech Ltd. ...... Respondent CORAM: HON'BLE MR.JUSTICEKE AJAY TEWARIHON'BLE MR. JUSTICHARNARESH SINGH GILL 000 Present ;Mr. Vivek Sethi, Senior Panel Counselfor the appellant. 000 AJAY TEWARI, J. (Oral) 1]This appeal has been filed by the Revenue under Section260A of the Income Tax Act, 1961 (in short “the Act’) against the orderof the Income Tax Appellate Tribunal, Chandigarh in ITANo.378/Chd/2017 dated 12.02.2018 for the assessment year 2012-2013, 2 Counsel for the Revenue has very fairly accepted that theissue in this case is squarely covered against it in the judgment of theApex Court inCommissioner of Income Tax Vs. Aarham Softrontics,Ciwil Appeal No.1784 of2019 decided on 20.02.2019. —The Apex Courtwhile dismissing the appeals of the revenue, had in para 24, heldas under :- “24. The aforesaid discussion leads us to the followingconclusions: (a) Judgment dated 20th August, 2018 in Classic Binding ITA 236 of 2018 (O&M) Industries case omitted to take note of the definition ‘initialassessment year’ contained in Section50-IC itself andinstead based its conclusion on the definition contained inSection SO-IB, which does apply in these cases. Thedefinitions of ‘initial assessment year’ in the two sections,viz. Sections S0-IB and &0-IC are materially different. Thedefinition of ‘initial assessment year’ under Section 80-IChas made all the difference. Therefore, we are of the opinionthat the aforesaid judgment does not lay down the correctlaw. (b) An undertaking or an enterprise which had set up a newunit between 7th January, 2003 and Ist April, 2012 in Stateof Himachal Pradesh of the nature mentioned in clause (11)of sub-section (2) of Section 80-IC, would be entitled todeduction at the rate of 100% of the profits and gains forfive assessment years commencing with the ‘initialassessment year’. For the next five years, the admissiblededuction would be 25% (or 30% where the assessee is acompany) ofthe profits and gains. (c) However, in case substantial expansion 1s carried out asdefined in clause (1x) of sub-section (8) of Section 80-IC bysuch an undertaking or enterprise, within the aforesaidperiod of 10 years, the said previous year in which thesubstantial expansion is undertaken would become ‘initialassessment year’, and from that assessment year theassessee Shall be entitled to 100% deductions of the profitsand gains. (d) Such deduction, however, would be for a total period of10 years, as provided in sub-section (6). For example, if theexpansion 1s carried out immediately, on the completion offirst five years, the assessee would be entitled to 100%deduction again for the nextfive years. On the other hand, ifsubstantial expansion is undertaken, say, in Sth year by anassessee such an assessee would be entitled to [00% deduction for the first five years, deduction @ 25% of theprofits and gains for the next two years and @ 100% againfrom sth year as this year becomes ‘initial assessment year’once again. However, this 100% deduction would be forremaining three years, 1.e., Sth, 9th and 10th assessmentyears. In view of the above, the appeal stands dismissed. Since the main case has been dismissed, the pending C.M.Application, if any, also stands disposed of, (AJAY TEWARITJUDGE July 09, 2019pooja sharma-l (HARNARESH SINGH GILL)JUDGE Whether speaking/reasoned Whether Reportable | Yes/NoYes/No