TaxTMI 
TaxTMI 
2014 (7) TMI 1268
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.... be set off against the profits and gains, if any, of any business or profession carried on by him and assessable for that Assessment year; if not wholly so set off, the amount of unabsorbed depreciation allowance not so set off shall be carried forward to the following assessment year not being more than eight assessment years immediately succeeding the assessment year for which the aforesaid allowance was first computed. 8. In view of the above and keeping in mind the memorandum of explaining the provisions in the Finance (No.2) Bill, 1996 and in the light of the principles as laid down by the Hon'ble Supreme Court in the case of Kerala State Industrial Development Corporation Ltd. Vs. CIT (2003) 259 ITR 51 (SC), we are of the view that ....
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....sment years. Therefore, the proposed change will have effect only after 8 years and there is no cause for immediate concern about its likely impact on industry. Eight years is a period long enough for industry to adjust itself to the new dispensation and provide for depreciation accordingly. A number of Hon'ble members have brought to my notice that the proposed amendment may adversely affect sick companies. I accept the suggestions made by them. I, therefore, propose to provide that the time limit of 8 years shall not apply to sick companies, during the period the company is treated as a "sick company" under the Sick Industrial Companies (Special Provisions) Act, 1985." Taking inspiration from the aforesaid speech of the Finance Minister,....
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....ment year 1998-99. In order to resolve the controversy we have taken assistance of Mr. M.P. Agarwal, a very knowledgeable learned Advocate in tax matters who previously was in the panel of the revenue but now is no more there. He submitted that the provisions introduced suggest that the unabsorbed depreciation allowance could not be wholly set off against the profits and gains, if any, of any business or profession carried on by the assessee. The unabsorbed depreciation allowance could be set off from the income under any other head during the assessment year 1997-98. If the unabsorbed depreciation allowance could not be wholly set off during the assessment year 1997-98, the left over could only be set off against the profits and gains, if ....
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....absorbed depreciation allowance cannot be wholly so set off, the amount of unabsorbed depreciation allowance not so set off shall be carried forward to the following assessment year not being more than eight assessment years immediately succeeding the assessment year for which the aforesaid allowance was first computed:" Mr. Bagchi submitted that such a construction is plainly contrary to the speech delivered by the Hon'ble Finance Minister which we have quoted above. Mr. Bagchi may be right but we cannot ignore the provision of law for the purpose of giving effect to the speech of the Hon'ble Finance Minister. Even in the case of K. P. Varghese vs. Income-Tax Officer, Ernakulam and Another, relied upon by Mr. Bagchi, it was held that the s....