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2014 (7) TMI 136 - HC - Income TaxProfits and gains u/s 80HH and 80IA of the Act – Eligible industrial undertaking – Reduction of depreciation u/s 32(1), unabsorbed depreciation u/s 32(2) and unabsorbed loss u/s 72 of the Act – Held that:- For claiming deduction under any provision of Chapter VIA, of which Section 80HH & 80I are also part, then it has to be after allowance of all deductions such as depreciation, unabsorbed depreciation & unabsorbed losses and therefore, in order to compute the profit and loss of income from an industrial undertaking, to which Section 80HH & 80I applies, the provisions of Part D of Chapter IV has to be taken into consideration and it is only after computing the income in accordance with the provisions contained in the Chapter that income from such industrial undertaking, included in the gross total income of an assessee, could be found out - deduction can only be calculated with reference to the profit and loss account of the assessee and after deductions on account of depreciation or additional depreciation unabsorbed depreciation, unabsorbed losses etc. and only if such income is positive would be eligible for deduction under Section 80HH & 80I of the IT Act. The gross total income of the assessee has to be worked out after deducting the aforesaid deductions only to arrive at the net income and in case, after deducting all these statutory deductions, some income remains, then obviously the assessee would be entitled to deduction under Section 80HH & 80I of the IT Act - when there is no taxable income, then no deduction under Chapter VIA could be allowed - after allowing depreciation, unabsorbed loss and unabsorbed depreciation, there was no positive income - the assessee was not entitled to any deduction u/s 80HH & 80I of the Act – Decided against Assessee.
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