Deductions in case of new industrial undertakings employing displaced persons, etc
C—Deductions in respect of certain incomes
Deductions in case of new industrial undertakings employing displaced persons, etc.
80H. (1) Where the gross total income of any assessee includes any profits and gains derived from any industrial undertaking to which this section applies, there shall be allowed, in accordance with and subject to the provisions of this section, a deduction from such profits and gains of an amount equal to fifty per cent thereof in computing the total income of the assessee, so however, that the amount of the deduction under this section shall not, in any case, exceed one hundred thousand rupees.
(2) This section applies to any industrial undertaking which fulfils all the following conditions, namely :
(i) it is not formed by the splitting up, or reconstruction, of a business already in existence;
(ii) it is not formed by the transfer to a new business of a building, machinery or plant previously used for any purpose;
(iii) it has begun or begins to manufucture or produce articles in any part of India at any time within a period of three years next following the 1st day of April, 1967;
(iv) it employs, on every working day throughout the previous year, forty or more workers in a manufacturing process (whether carried on with or without the aid of power); and
(v) it employs displaced persons or repatriates or members of the families of displaced persons or repatriates (all such employees being, hereinafter, referred to as rehabilitated employees) and the daily average number of rehabilitated employees, as certified by the prescribed authority is not less than sixty per cent of the daily average number of all the persons employed in the undertaking, throughout the previous year.
Explanation 1.—"Member of the family", in relation to any person who is a displaced person or repatriate, means any member of the family of such person if such member was, before his employment in the undertaking, dependent on such person.
Explanation 2.—"Daily average number", in relation to rehabilitated employees or, as the case may be, all the persons employed in the undertaking, shall be taken to be the number arrived at by dividing the aggregate of the number of rehabilitated employees or, as the case may be, the total number of persons employed in the undertaking on each working day of a month by the total number of working days in that month.
(3) The provisions of this section shall, in relation to an industrial undertaking, apply to the assessment for the assessment year relevant to the previous year in which the undertaking begins to manufacture or produce articles, and the nine assessment years immediately succeeding.
[As amended by Finance (No. 2) Act, 1971 and Taxation Laws (Amendment) Act, 1970]