Carry-forward of business losses remains available when the loss-year return is timely filed, even if losses are not yet determined.

A return for the loss year filed within the Board-extended time satisfied the requirement of Section 139(3) of the Income-tax Act, 1961 for carrying forward business losses. The mere fact that the Assessing Officer had not yet quantified or determined the losses did not justify denial of the set-off claim against subsequent-year profits. On that basis, the Tribunal's remand for fresh decision was treated as justified, and the departmental challenge failed.

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Issues: Whether the assessee was entitled to carry forward and set off the business losses of the earlier assessment year against the profits of the subsequent year when the return for the loss year had been filed within the time extended by the Board but the Assessing Officer had not determined the losses.

Analysis: The return for the loss year was filed within the period extended by the Board, satisfying the requirement of Section 139(3) of the Income-tax Act, 1961. The only impediment was that the Assessing Officer had not yet quantified or determined the losses. The absence of such determination did not justify denial of the benefit claimed, and the Tribunal was justified in remanding the matter for fresh decision.

Conclusion: The assessee's claim could not be rejected on the ground that the losses had not been determined by the Assessing Officer, and the departmental appeal failed.

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