In yet another move to reduce litigation, CBDT clarifies the meaning of term “initial assessment year” u/s 80IA(5) relevant for assessees' claiming incentive-deduction; 

Notes that the term is being interpreted by AOs to mean the first year in which eligible business/ manufacturing activities commence operations; 

Clarifies that Sec 80IA(2) offers assessee an option to claim deduction for 10 consecutive years out of 15 years (20 years in certain cases), therefore ‘initial assessment year’ means the first AY opted by assessee to claim Sec 80IA benefit; 

As an abundant caution, CBDT states that total number of years for claiming deduction cannot exceed the prescribed slab of 15 or 20 years and claim should be availed in continuity; 

Directs AO to allow deduction in accordance with clarification and also instructs Standing Counsels/ Department Representatives to withdraw pending appeals to the extent that it pertains to the interpretation of term ‘initial assessment year’