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2015 (4) TMI 410 - HC - Income TaxSet off of unabsorbed business loss brought forward against the profits of the erstwhile 10A unit - claim for set off disallowed by AO as such claim of set off or brought forward business loss against the profits of the erstwhile 10A unit in the year under consideration, being the first assessment year, after the expiry of the tax holiday period, cannot be allowed - Tribunal allowed the claim - Held that:- Subject to the provisions of section 10A, a deduction of such profits and gains as are derived by an undertaking from the export of articles or things or computer software for a period of ten consecutive assessment years beginning with the assessment year relevant to the previous year in which the undertaking begins to manufacture or produce such articles or things or computer software, as the case may be, shall be allowed from the total income of the Assessee. We are not as much concerned with the proviso and other subsections, save and except subsection (6). The Tribunal has understood that this subsection contains non obstante clause and therefore, notwithstanding anything contained in any other provision of the Act, in computing the total income of the Assesee of the previous year relevant to the assessment year immediately succeeding the last of the relevant assessment years, or of any previous year relevant to any subsequent assessment year, as per clause (ii) thereof, no loss referred to in section (1) of section 72 or subsection (1) or subsection (3) of section 74 insofar as such loss relates to the business of the undertaking, shall be carried forward or set off where such loss relates to any of the relevant assessment years. In clause (ii) w.e.f. 1st April, 2004, the words “ending before the 1st day of April, 2001” were inserted. It is this insertion which has enabled the Tribunal to hold that if the losses pertain to any subsequent assessment year, then, the understanding of the Revenue as reflected in the Circulars would bind it. That understanding apart, independently, the Tribunal has analysed this provision and found that by virtue of the nonobstante clause and by virtue of wording of sub clause (ii) that the Revenue could not have disallowed this claim of set off. We therefore do not find that in allowing the Appeal of the Assessee, the Tribunal has committed any error of law apparent on the face of the record or acted perversely. - Decided in favour of assessee.
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