1989 (4) TMI 45

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....sessee filed a return for the assessment year 1972-73 declaring a loss of Rs. 41,651. No claim was made for any deduction under section 80J of the Act for that year. The Incometax Officer did not, therefore, determine the deduction admissible under this provision of law for the purposes of carrying it forward and setting it off against profits and gains in any subsequent year. In the next assessment year, namely, 1973-74, the assessee, in the first instance, filed a return declaring an income of Rs. 11,769, but later filed revised return showing a loss of Rs. 42,069. Deduction under section 80J of the Act was claimed in the revised return for both the assessment years, 1972-73 and 1973-74. The Income-tax Officer determined and allowed de....

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.... these years was disallowed as it had already been rejected and this rejection had become final. Further, the Income-tax Officer observed that the preconditions for the claim under section 80J of the Act for these two assessment years had not been fulfilled. The deduction to the extent of Rs. 1,404 for the assessment year 1976-77 was, however, allowed with the direction that this claim be carried forward and set off against profits and gains in the subsequent years. When the matter went up in appeal, the Commissioner of Income-tax (Appeals) allowed the claim for 1974-75 and 1975-76 also, but as regards 1972-73, it was held that as this matter had become final by the order for the assessment year 1973-74, the assessee could not claim this....

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....s that the deduction should be permissible even in a case where the formality of making a claim has not been specifically done by the assessee in the first or the relevant assessment year, in a case where admittedly loss has been sustained and there is no profit or gain against which the deduction could at all be adjusted." This view has subsequently been followed in a string of authorities, namely, Indian Aluminium Co. Ltd. V. CIT [1980] 122 ITR 660 (Cal); Bluemount Ceramics Ltd.'s case [1980] 123 ITR 385 (Mad) ; CIT v. Mattoo Worsted Spinning and Weaving Mills [1983] 139 ITR 1020 (J & K) ; CIT v. Ennore Foundries Ltd. [1985] 151 ITR 464 (Mad) ; CIT v. Veljan Hydrair (P.) Ltd. [1985] 151 ITR 734 (AP) and CIT v. M. A. Paper and Card Boar....