The Income Tax Officer, in respect of the assessment years 1975 76 and 1977 78, issued a certificate under Section 80K of the Act and in this certificate, for the purpose of determining the exempted portion of the dividend out of the total dividend amount declared by the appellant companypany, the relief allowable to the appellant under Section 80 J of the Act was taken as the total relief allowable under the said provision being 6 of the capital employed in the said new undertakings.
For the said assessment years companymencing from 1975 76, the companypany applied for requisite certificate under Section 80K read with Section 197 3 of the Act for the purpose of enabling its shareholders to claim exemption out of the dividends received by them because the companypany was entitled to relief under Section 80J for those years.
The appellant companypany replied that the total income of the companypany for the assessment year 1978 79 was nil and there were carried forward losses, depreciation etc.
It established a new industrial undertaking by installing a Polyester Fibre Plant at Baroda in the accounting year of 1974 73, relevant to the assessment year 1975 76.
in respect of the preceding years.
4,66,73,159/ .
An application was made to the Income Tax Officer under Section 197 3 read with Section 80 K of the Act requesting for a certificate under the said Section 80 K. According to the appellant, the relief claimed was Rs.
In the subsequent accounting year 1975 76, the appellant also installed a new Sulzer plant at Ahmedabad.
During the accounting year relevant to the assessment year 1978 79, the appellant companypany declared a total dividend of Rs.
Both the aforesaid plants fulfilled all the companyditions for the grant of necessary relief under Section 80 J of the Act.
77,42,921/ in respect of the Polyester Fibre Plant and Rs.
The appellant is a public limited companypany and is engaged in manufacturing of textiles, chemicals etc.
18,07,968/ in respect of the Sulzer Plant.
85.38 as against 100 which had been indicated by the appellant.
On that basis the exempted percentage of the dividend according to the respondent worked out at Rs.
The respondent worked out the relief allowable to the appellant in respect of the said plants at 6 of the capital employed at Rs.
24,07,556/ for Sulzer Plant.
The respondent, thereupon called for certain information from the appellant with regard to the total income of the appellant for the assessment year 1978 79 as well as the profits of the Polyester Fibre Plant and the Sulzer Plant for the accounting year relevant to the assessment years 1977 78 and 1978 79.
1,11,86,231/ to its shareholders.
It also stated that the profits of the Polyester Fibre Plant for the assessment year 1978 79 were Rs.
1,00,35,434/ for Baroda Plant and Rs.
In respect of Sulzer Plant it was pointed out that there was numberprofit.
