Carry-forward of Section 80J relief allowed in the profit year despite no claim in earlier loss years

Section 80J relief for a new industrial unit could be carried forward and claimed in the year profits arose, even if no separate claim was made in the earlier loss years. The Court reasoned that the absence of positive taxable income in those years explained the omission, and that sufficient compliance existed where the statutory benefit was otherwise admissible and the deduction was adjusted against later profits. The benefit was therefore not to be denied merely because no claim had been lodged during the loss years.

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Issues: Whether the assessee could carry forward relief under section 80J of the Income-tax Act, 1961 for earlier loss years and claim the deduction in the year in which profits arose, even though no claim had been made in the loss years.

Analysis: The relief under section 80J was available for a new industrial unit, and the absence of positive taxable income in the initial years explained why no claim was made then. The Court accepted that, where the statutory benefit is otherwise admissible, it is sufficient compliance if the claim is made in the year in which profits arise and the deduction can be adjusted against such profits. The reasoning followed the view that the benefit should not be denied merely because no separate claim was lodged in the loss years.

Conclusion: The assessee was entitled to carry forward the section 80J relief and to claim it in the profit year despite not having made the claim in the earlier loss years, and the answer was in favour of the assessee.

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