Madras High Court· 09 September 2026

Can the Department take a different stand under Section 80IB of the Income-Tax Act, 1961 for one year where it accepted the claim on identical facts for other years?

M/s TTK Protective Devices Ltd v. The Assistant Commissioner of Income Tax

TCA.604/2013 · 2026:MHC:3958 · TCA No. 604 of 2013
Coram: Justice Anita Sumanth · Justice S.Raveekumar

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Answer

The Department cannot take a different stand for one year where it accepted the Section 80IB claim on identical facts for other years.

No. The Department cannot take a different stand for one year where it accepted the Section 80IB claim on identical facts for other years. Here the deduction had been allowed for years one to seven, nine and ten, and was refused only in the eighth year. The Court treated the requirement of consistency/uniformity in the application of law as a separate reason for allowing the appeal.

Headnote

Income-Tax Act, 1961 — s.80IB — XI Schedule — Serial Nos.27 and 28 — Rubber contraceptives — Consistency/uniformity in the application of law — Income-Tax Act, 1961 — s.80IB — XI Schedule bar — Goods made of rubber — Held: The XI Schedule bar on deduction under Section 80IB applies only to the products specifically referred to in its entries and not to all and any goods made of rubber; rubber contraceptives are therefore outside Serial Nos.27 and 28, following MRF. (¶8, 9) Income-Tax Act, 1961 — s.80IB — Consistency/uniformity — Claim accepted in other years — Held further: Where the Department accepted the claim on identical facts and legal position for nine of the ten years, there is no reason for a different stand for the year in question. Appeal allowed. (¶9, 10)

Headnote

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In the Court's own words

Paragraph 4Section 80IB grants deduction for a period of ten years from the year in which commercial production is commenced. In this case, the assessee has been consistently claiming and has been granted deduction under Section 80IB for years one through seven, years nine and ten.

Paragraph 5This is the solitary assessment year (the eighth year of claim) in which the assessing authority took the view that the products manufactured by the assessee would fall within the meaning of the Entries under Serial Nos. 27 and 28 of the XI Schedule of the Act, which adumbrates specific products that are barred from the grant of deduction under Section 80IB.

Paragraph 9The present issue is thus covered by the above decision to which one of us is a party. We accept the claim of the assessee also for another reason. The Department has accepted the claim of the assessee on identical facts and legal position for nine out of ten years comprising the period for which deduction may be claimed. There is hence no reason whatsoever for a different stand to have been taken for the year in question.

Paragraph 10Hence the substantial questions are answered in favour of the assessee and this appeal is allowed, both applying the ratio in the case of MRF (supra) as well as the requirement of consistency/uniformity in the application of law. No costs.

Acts & Sections

s.80IB Income-Tax Act, 1961

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Also decided in this judgment

Does the XI Schedule bar on deduction under Section 80IB of the Income-Tax Act, 1961 apply only to the products specifically referred to in its entries?

Plain-language answer prepared by the LexStreak Editorial Desk — verify against the judgment. Source: Madras High Court. Corrections