In Brief
The Supreme Court examined whether an assessee claiming 100% income tax exemption under Section 80-IC for five years on setting up a new industrial unit can claim the same exemption again after carrying out substantial expansion of its factory. The Court held that yes, an assessee can claim 100% exemption anew following substantial expansion, as the statute's definition of 'initial assessment year' (which triggers exemption) includes completion of substantial expansion. However, total deduction cannot exceed 10 years. The judgment reversed an earlier decision which had wrongly applied the definition from a different section, thereby affirming the High Court's judgment in favor of the assessees.
The lawyer headnote and full judgment text are available to registered users.