In Brief
Industrial undertakings subject to Section 80-IA of the Income Tax Act sought to claim 100% deductions on profits while avoiding depreciation charges, contending the choice was optional under prior law. The Supreme Court held that Section 80-IA is a self-contained code for profit-linked tax incentives separate from Chapter IV's investment-linked depreciation regime. Depreciation must be deducted when computing profits eligible under Section 80-IA, regardless of whether the assessee claimed it for business income purposes. Permitting depreciation to be omitted would impermissibly inflate profit-linked deductions, contrary to the statutory scheme.
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