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2015 (11) TMI 648 - HC - Income TaxDisallowance of business loss and unabsorbed depreciation - whether the period of three years as prescribed u/s.72A(2)(a)(i) of the Act has to be computed including the period of setting up of business and not from the date of commencement of actual production? - Held that:- In the present case, the licence for setting up business of power generation, loans for the same, construction of the building and purchase of machinery etc., had started from the year 2000 itself, which was duly reflected in the books of account of the amalgamating company. As such, the view taken by the Appellate Authority [CIT (Appeals)] as well as the Tribunal, in this regard that the amalgamating company was engaged in the business of generation of power much prior to three years from the date of amalgamation of the Company, cannot be faulted. In the facts of this case, it cannot be disputed that the engagement of the amalgamating company in the business of power generation had begun from the year 2000, even though the production or generation of power, i.e., the commencement of business may have been with effect from 08.08.2003. We may also mention that Section 72A of the Act provides for set off of accumulated loss and unabsorbed depreciation, which is for the benefit of the assessee-amalgamated company. Thus, in our view, when a provision is for the benefit of an assessee, it should be liberally interpreted in favour of the assessee which has to be given the benefit of such provision. It is well settled law that if two views are possible, then the one in favour of the assessee (amalgamated company in this case) should be adopted. We are thus of the opinion that the assessee-amalgamated company would be entitled to the benefit of Section 72A of the Act.- Decided in favour of assessee.
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