M. S. SHAH, K. A. PUJ, J. ( 1 ) AT the instance of the applicant-Revenue, the following question of law is referred for the opinion of this Court for Assessment Years 1985-86 and 1986-87:-"whether, the Appellate Tribunal is right in law and on facts in directing the Assessing Officer to give relief u/s. 80-I on the gross total income without reducing the same by allowance of section 80hha relief?" ( 2 ) HEARD Ms. Mona Bhatt, Ld. Standing Counsel appearing for the applicant-Revenue. Noone appears on behalf of the respondent-assessee though notice was duly served. ( 3 ) THE facts leading to this reference and as stated by the Tribunal are as under:3. 1. THE assessee company claimed deduction under Section 80hha and 80i. The Assessing Officer computed the gross total income and then computed the relief under Section 80hha and then for quantifying the relief under Section 80i which is allowed at 20% of the gross total income, he allowed deduction u/s. 80i at 20% on the balance income after deducting the relief under Section 80hha from the gross total income. 3. 2. BEFORE the Commissioner of Income-tax (Appeals), the assessee contended that in effect the deduction allowed u/s. 80i was only 16% in place of 20% of the gross total income. The Commissioner of Income-tax (Appeals) accepted the contention of the assessee and held that quantification of both the relief has to be done with reference to the gross total income as defined us. 80-B (5 ). He noted the Departments contention that Section 80hha (6) was not concerned with the quantification, but the said postulated for giving the consequence of deduction. He, therefore, allowed the assessees claim. 3. 3. IN appeal filed by the Revenue before the Tribunal against C. I. T (A)s order, the Tribunal agreed with C. I. T. (A) that the quantification of deductions under Section 80i as well as 80 HHA of the act has to be done separately, but with reference to the same figure of gross total income as defined under Section 80b (5) of the Act as the total income before making any deduction under chapter VIA which includes both these sections, namely, 80hha and 80i. ( 4 ) THE relevant provisions with which we are concerned are reproduced hereinbelow. Section 80hha - Deduction in respect of profits and gains from newly established small-scale industrial undertaking in certain cases. ( 4 ) THE relevant provisions with which we are concerned are reproduced hereinbelow. Section 80hha - Deduction in respect of profits and gains from newly established small-scale industrial undertaking in certain cases. 80hh (1) Where the gross total income of an assessee includes any profits and gains derived from an industrial undertaking, or the business of a hotel, to which this section applies, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to twenty percent thereof. "section 80i Deduction in respect of profits and gains from industrial undertaking after a certain date etc. (1) Where the gross total income of an assessee includes any profits and gains derived from an industrial undertaking or a ship or the business of repairs to ocean going vessels or other powers craft to which this section applies, there shall, in accordance with and subject to the provisions of this Section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to twenty per cent, thereof;provided that in the case of an assessee, being a company, the provisions of this sub-section shall have effect in relation to profits and gains derived from an industrial undertaking or a ship or the business of a hotel as if for the words "twenty per cent", the words "twenty five percent" had bee substituted. ( 5 ) ON careful consideration of the aforesaid two sections, it becomes clear that the assessee whose total income included profits and gains received from newly established small scale industrial undertaking to which provisions of S. 80hha applied became entitled to deductions from such profits and gains of an amount equal to 20% thereof. So far as the provisions of Section 80i are concerned, the said provisions enabled the assessee to get deduction to the extent of 20% or 25% as the case may be, of such profits and gains. Thus, on perusal of these two sections, it is clear that the benefits conferred on the assessee thereunder are quite different. ( 6 ) IT is also worthwhile to take note of section 80hha (6) of the Act. Thus, on perusal of these two sections, it is clear that the benefits conferred on the assessee thereunder are quite different. ( 6 ) IT is also worthwhile to take note of section 80hha (6) of the Act. It stipulates that in a case where the assessee is entitled also to the deduction under Section 80i or Section 80j in relation to the profits and gains of a small scale industrial undertaking to which this section applies, effect shall first be given to the provisions of this Section. Thus, when benefit of deduction under the provisions of section 80hha and Section 80i is admissible to a particular assessee, first of all benefit under the provisions of Section 80hha is to be given to the assessee. Thereafter, the assessee gets benefit of deduction under the provisions of Section 80-I of the Act. While dealing with the deductions under Section 80hh and 80j of the Act, this Court in the case of Commissioner of Income Tax Vs. Sidhpur Isabgul Processing Co. Ltd. , being ITR No. 282 of 1985 decided on 14. 6. 2001, has observed that if the assessee is not in a position to avail complete deduction under the provisions of Section 80j on account of not having sufficient profits, he is entitled to carry forward the deficiency and can get the whole or balance of the deficiency as the case may be, set off against the profits and gains for the next assessment years. This fact denotes that the Revenue cannot deprive the assessee of the benefit of deduction under the provisions of Section 80j even if the assessee is not having sufficient profits to have complete advantage under the provisions of Section 80hh and 80j in one particular year. In J. P. Tobacco Products Pvt. Ltd. Vs. C. I. T. (1998) 229 ITR 123 (M. P.), it is held that from conjoint reading of Sections 80hh (9), 80-I and 80j (3), it is clear that in so far as the benefit of Section 80-I is concerned, it has to be granted on the gross total income and not on the income reduced by the amount allowed under Section 80hh. In that view of the mater, the Court further held that the Tribunal was not right in holding that deduction under Section 80-I, for assessment year 1984-85, was to be allowed only on the balance of the income after deducting the relief under Section 80hh from the gross total income. ( 7 ) IT is to be noted here that Section 80-I with which we are concerned here in this reference was inserted by the Finance (No. 2) Act, 1980 with effect from 1/04/1981 i. e. for and from Assessment Year 1981-82. Initially, deduction under this Section was granted, interalia to new industrial undertaking (including cold storage plants) which commenced production within the period of four years next following March, 31, 1981. The provisions relating to this deduction are intended to provide an incentive for investment in certain desired directions and promote industrialisation. In view of the continued need to provide this incentive, the Finance Act, 1985, has extended this concession by another five years, that is in relation to industrial undertaking which commerce production before 1/04/1990. It appears to us from this that the Legislature wanted to give some additional benefit to those who establish new industrial undertaking within certain time limits. If the benefit given under Section 80-I is restricted as submitted on behalf of the Revenue, in our opinion, the entire object of giving additional benefit to those who establish new industrial undertaking would be frustrated. ( 8 ) HAVING regard to the facts and the circumstances of the case and following the decision of this Court in the case of Siddhpur Isabgul Processing Co. Ltd. (Supra) and decision of M. P. High Court in J. P. Tobacco Products Pvt. Ltd. (Supra), we are of the view that the assessee is entitled to benefit of deduction under Sections 80hha and 80-I of the Act in full as directed by the Tribunal. We are of the opinion that the Tribunal has correctly interpreted the provisions of Section 80hha and 80-I of the act and has arrived at the correct conclusion. We see no justification in taking different view. We, therefore, answer the question referred to us in the affirmative i. e. in favour of the assessee and against the Revenue. The reference is accordingly disposed of with no order as to costs. .