Is deduction u/s 80-IA of the Income Tax Act, restricted to the amount of 'business income' only?

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Last updated: 19 May 2021
Quick Summary
The Supreme Court addressed whether deductions under Section 80-IA of the Income Tax Act are restricted solely to 'business income'. The case involved Reliance Energy Ltd. and the Revenue's argument that the deduction should be limited. The Assessing Officer initially restricted the deduction, but this was overturned by the Commissioner (Appeals), the Income Tax Appellate Tribunal, and subsequently upheld by the High Court, leading to the Revenue's appeal.

Court :
Supreme Court of India

Brief :
By an order of assessment dated 31.01.2005, the Assessing Officer restricted the eligible deduction under Section 80-IA of the Income Tax Act, 1961 (hereinafter “the Act”) to the extent of ‘business income’ only. On 23.03.2006, the Commissioner of Income-Tax (Appeal)-I (hereinafter “the Appellate Authority”) partly allowed the Appeal filed by the Assessee and reversed the order of the Assessing Officer on the issue of the extent of deduction under Section 80-IA of the Act.

Citation :
Civil Appeal No. 1327 of 2021

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