Carry-forward loss requires an already ascertained prior-year loss; reassessment cannot create that entitlement.

Carry-forward relief under Section 24(2) depended on an already ascertained loss from a prior assessment year, so an undetermined earlier-year loss could not be created or certified later to support set-off. Section 24(3) applied only where a loss was computed in the course of assessing the total income of that year; reassessment proceedings under Section 34 were confined to reassessment and did not require the Income-tax Officer to determine an earlier year's loss for this purpose. The assessee therefore could not insist on such determination, and the set-off claim failed.

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Issues: Whether a loss of a previous assessment year, not determined in that year, could be set off in a later year under Section 24(2); and whether Section 24(3) required the Income-tax Officer, in reassessment proceedings under Section 34, to determine that earlier loss for the purpose of enabling the set-off.

Analysis: The right under Section 24(2) was held to depend on an already ascertained balance of loss carried forward from an earlier year. The provision did not contemplate determination, in a later year, of an undetermined loss of a previous year. Section 24(3) was held to apply only where, in the course of assessing the total income of a year, a loss and profit arise within that assessment and the officer has to notify the loss computed for that year. Proceedings under Section 34 were confined to reassessment and were not proceedings for assessing the total income in the sense required by Section 24(3).

Conclusion: The assessee was not entitled to require determination of the previous year's loss in the reassessment proceedings, and the claim to set off that loss under Section 24(2) failed.

Ratio Decidendi: A carry-forward loss under Section 24(2) must be an already ascertained loss from a prior assessment year, and Section 24(3) does not oblige the Income-tax Officer in reassessment proceedings under Section 34 to determine an earlier year's loss for the purpose of creating that entitlement.

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