TaxTMI 
TaxTMI 
1988 (3) TMI 137
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.... in that firm for asst. yr. 1980-81 was admittedly determined at Rs. 13,062. For asst. yr. 1981-82, the assessee continued to derive share income in some other firms. Those firms were not engaged either in distribution or exploitation of feature films. However, for asst. yr. 1982-83, the assessee herself took up the business of distribution and exploitation of films as proprieless. The name of the proprietory concern is M/s. Lalita Films. She sustained a loss of Rs. 37,875 and it is said that she had produced a film in Telugu called 'Tirupati Kshetra Mahatmyam'. In the asst. yr. 1982-83, she derived incomes from three partnership firms, namely, (a) M/s. Padmanabha Printing Works, (b) M/s. Maruti Transports and (c) M/s. S.G. Sambandan & Co.,....
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....ndition for carry forward and set off of the business loss is that the assessee must be carrying on the same business or profession earlier. In the previous year relevant to the asst. yr. 1980-81 the assessee, along with other partners, was carrying on business of exploitation of films. In the previous year relevant to asst. yr. 1982-83 also, the assessee was carrying on the same business in exploitation of films as proprietress. He took the view that it does not make any difference because the assessee is carrying on the same business. It is immaterial whether the business is carried on by the assessee in a proprietory capacity or in partnership with others. He relied upon the Delhi High Court's decision in S. Narayan Singh vs. CIT (1967) ....
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....tinuing to carry on the same business in which the loss has arisen was not correct and the provisions of s. 72(1) were wrongly applied. Hence the AAC's order is liable to be set aside and that of the ITO restored. 3. We have heard Shri P. Radhakrishnamurthy, learned Departmental Representative and Shri C.V.K. Prasad, learned advocate for the assessee. The foremost objection raised on behalf of the Revenue by the learned departmental representative is that the loss which was ascertained and ordered to be carried forward to the next year was part of the loss sustained by a partnership firm which was engaged, inter alia, in production and distribution of feature films. After the accounting year relevant to asst. yr. 1980-81, the assessee ca....
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....ws: "While before 1955-56 such loss could be set off against further income from same business, the post 1955 law made set off allowable from the future income of any business provided that the assessee, in such future year, continued to carry on the business wherein the loss (to be set off) occurred". In this case the assessee not only carried on the business in production and distribution of feature films but also carried on other business as being a partner in three more firms. In asst. yr. 1982-83, the assessee carried on the same business in which she incurred loss as partner of a firm in asst. yr. 1980-81. In CIT vs. Bankamal Naranjan Das Katihal (1967) 65 ITR 337 (P&H) the question was whether there was an identity of business ....
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....to consider various factors. Production of the feature film should be completed within one year or strictly according to the time bound schedule. It concerns itself not only with capital but also with availability of stars and getting perfection before taking the film etc. So simply because the assessee did not venture to start any production for asst. yr. 1981-82 does not mean that she stopped the idea of producing films altogether. The very fact that in the next year itself she produced a film would clearly show her inclination to continue the business and it will give a presumption that in the immediately preceding accounting year to the one relevant to asst. yr. 1982-83 she was having an idea of going for production of feature film. But....