THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 11 (1) BANGALORE vs M/S ACE MULTI AXES SYSTEMS LTD.

The Supreme Court upheld the High Court's decision that an assessee is entitled to the benefit of deduction under Section 80-IB of the Income Tax Act, 1961, even if it ceases to be a small scale industry during the ten consecutive years of eligibility. The Court clarified that the eligibility for deduction is based on the conditions satisfied at the time of claiming the deduction, not on the status of the industry thereafter. The appeal by the revenue was dismissed, affirming the High Court's ruling in favor of the assessee.