Section 15C exemption cannot be carried forward absent express statutory language; yearly profit-based relief only.

Under section 15C of the Indian Income-tax Act, 1922, the Delhi HC treated the exemption as confined to the assessment year in which profits or gains arose from the industrial undertaking. It held that the provision created a tax exemption, not an accumulated balance of unabsorbed exemption available for later years, and that carry forward was permissible only where the Act expressly so provided, as in section 24. In the absence of express language authorising carry forward or carry back, the exemption could not be extended by equity or presumed intent. The later carry-forward scheme in section 80J of the 1961 Act was treated as a separate regime and did not change the meaning of section 15C.

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Issues: Whether the unutilised portion of the exemption available under section 15C of the Indian Income-tax Act, 1922, could be carried forward and set off against the profits of subsequent assessment years when the earlier years resulted in losses or insufficient profits.

Analysis: The relief under section 15C was held to be confined to the assessment years in which profits or gains were derived from the industrial undertaking. The section granted an exemption from tax, not a balance of unabsorbed exemption capable of being accumulated from year to year. Each assessment year was a separate unit, and carry forward of losses was permissible only where the Act expressly provided for it, as under section 24. In the absence of express words authorising carry forward or carry back of the exemption under section 15C, the provision could not be rewritten on considerations of equity or presumed legislative intent. The later introduction of a carry-forward mechanism in section 80J of the Income-tax Act, 1961, was treated as a different scheme and did not alter the meaning of section 15C.

Conclusion: The unutilised exemption under section 15C could not be carried forward or set off against future profits, and the claim was rejected.

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