Statutory loss notice and set-off rules allowed re-determination of carry-forward loss and set-off against firm income.

Failure to serve notice of the loss computed under the statutory procedure meant the earlier loss determination did not become final and could be reopened in later proceedings. The assessee was therefore entitled to seek re-determination of the carry-forward loss. The assessee's personal business loss could also be set off against taxed share income from an unregistered firm, as that position had already been settled against the revenue in the earlier decision applied here. Both questions were answered in favour of the assessee, and the appeals failed.

---

---

Issues: (i) Whether the assessee could reopen the quantum of loss determined for an earlier assessment year in subsequent proceedings when no notice of the loss computed under the statutory procedure had been served. (ii) Whether the assessee's personal business loss could be set off against his taxed share income from an unregistered firm under the relevant set-off provision.

Issue (i): Whether the assessee could reopen the quantum of loss determined for an earlier assessment year in subsequent proceedings when no notice of the loss computed under the statutory procedure had been served.

Analysis: The statutory scheme required the Income-tax Officer to notify the amount of loss computed for the purposes of carry forward. Since that procedure was not followed, the assessee had no effective occasion to challenge the computation by appeal. The prior determination therefore did not attain such finality as to prevent re-determination in a later year.

Conclusion: The issue was answered in favour of the assessee.

Issue (ii): Whether the assessee's personal business loss could be set off against his taxed share income from an unregistered firm under the relevant set-off provision.

Analysis: This question had already been concluded against the revenue in the earlier decision relied upon by the parties, and that position governed the present appeals as well.

Conclusion: The issue was answered in favour of the assessee.

Final Conclusion: The appeals failed because both questions were answered against the revenue, leaving the assessee entitled to the relief sought.

Ratio Decidendi: Where the statutory procedure for notifying computed loss is not followed, the earlier loss determination does not preclude re-determination in a later year, and the set-off position must conform to the governing rule on taxed share income from an unregistered firm.

---