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Deduction U/s 80 IC

Started by akk, November 28, 2011, 12:31:58 PM

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A manufacturing firm is  situated in area eligible for deduction u/s 80IC and is claiming deduction accordingly. The present constitution of the firm is proprietorship

If the constitution of the firm is changed to partnership, whether it will have any impact on the eligibility of the unit, to claim deduction u/s 80 IC for the balance period.

i.e whether itwill amount to Reconstruction  of firm.


Punjab and Haryana High Court in the case of Mega Pacakages has held that An assessee is entitled to benefit of deduction under section 80-IC for remaining unexpired period after his proprietorship concern is converted into a partnership concern.

ashutosh majumdar

This is an excellent point. Didn't occur to me. You are right. The transferee of the undertaking will get it for the residual period. There is also a CBDT Circular on the point - can't recall off hand - search it. If you don't get it let me know, I'll fish it out.


Deduction is attached to undertaking and not to owner. There are hosts of such judgement on this aspect.Even CBDT old circular is also there.