KAJARIA CERAMICS LTD Vs. UOI

JUDGEMENT

(1.) By means of this Writ Petition, the petitioner has prayed for setting aside the Notification SO 165 dated 19.12.1986 insofar as it excludes Sikandrabad Block of Bulandshahr District from the list of backward areas for the purpose of getting the benefit under Section 80HH of the Income Tax Act. The petitioner has also prayed for quashing of the Circular issued by the CBDT insofar as it restricts the benefit of the deduction under Section 80HH of the Income Tax Act to units set up in the excluded areas vide Notification No. SO 165 dated 19.12.86. The petitioner has also prayed for setting aside the assessment orders for the assessment years 1995-96, 1996-97 and 1997-98.

(2.) We have heard learned Counsel for the parties and gone through the record.

(3.) Section 80HH was inserted in the Income Tax Act by the Direct Taxes (Amendment) Act, 1974 which provided for an incentive to entrepreneurs to set up industries in backward areas. The section, inter alia, provided for a deduction of 20% from the profits and gains from the business of an industrial undertaking, which sets up its business in a backward area.