2019 (11) TMI 1044

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....vance of the assessee is whether the Ld. CIT(Appeals) erred in holding the action of the Assessing Officer of setting off of unabsorbed business losses before allowing deduction u/s.10A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act'). The assessee prays in this appeal that the Assessing Officer be directed to allow the deduction u/s.10A of the Act before allowing set off of unabsorbed business losses. 3. The brief facts in this case are that the assessee has claimed deduction of Rs. 17,74,65,815/- u/s.10A of the Act and thereafter set off its brought forward losses and brought forward depreciation against the residual income from business and profession. The Assessing Officer brought to the notice of the assessee the d....

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.... CIT(Appeals) and detail written submission was filed before him by the assessee wherein the assessee submitted the detailed analysis regarding term of total income in order to bring out the relevant stage of deduction u/s.10A of the Act and set off of unabsorbed depreciation. That further, the assessee relied on the decision of the Hon'ble Bombay High Court in the case of CIT Vs. Black & Veatch Consulting (P). Ltd., (2012) 20 Taxmann. Com 727 ( Bom.). The Ld. CIT(Appeals) after considering the submissions of the assessee, assessment order and the facts of the case as per the detailed reasoning in his order which is on record admitted that the Hon'ble Supreme Court in the case of Himatsingka Seide Ltd. (supra.) has decided the issue in favo....

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....which deals with carry forward and set off of business losses. A distinction has been made by the Legislature while incorporating the provisions of Chapter VI-A. Section 80A(1) stipulates that in computing the total income of an assessee, there shall be allowed from his gross total income, in accordance with and subject to the provisions of the Chapter, the deductions specified in ss. 80C to 80U. S. 80B(5) defines for the purposes of Chapter VI-A "gross total income" to mean the total income computed in accordance with the provisions of the Act, before making any deduction under the Chapter. What the Revenue in essence seeks to attain is to telescope the provisions of Chapter VI-A in the context of the deduction which is allowable under s. ....

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....for the purposes of this provision." 17. If the specific provisions of the Act provide [first proviso to Sections 10A(1); 10A (1A) and 10A (4)] that the unit that is contemplated for grant of benefit of deduction is the eligible undertaking and that is also how the contemporaneous Circular of the department (No.794 dated 09.08.2000) understood the situation, it is only logical and natural that the stage of deduction of the profits and gains of the business of an eligible undertaking has to be made independently and, therefore, immediately after the stage of determination of its profits and gains. At that stage the aggregate of the incomes under other heads and the provisions for set off and carry forward contained in Sections 70, 7....