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2022 (4) TMI 392 - AT - Income TaxRectification of mistake - Computation of income u/s. 154 - adjusting brought forward assessed unabsorbed depreciation of assessment year 2004-05 against gross total income of the assessee, resulting in the revised total income coming to Nil and consequently denying any deduction u/s 80IA under Chapter VIA of the Act - HELD THAT:- Profits eligible for deduction u/s 80IA of the Act have to be calculated after adjusting brought forward depreciation therefrom. Meaning thereby that law clearly provides for deduction u/s 80IA to be granted after set off of unabsorbed depreciation. There is no scope for any other interpretation, we find, nor has any been pointed out by the assessee before us. We therefore hold that the non adjustment of brought forward depreciation from profits and gains of business and profession, for determining the quantum of deduction u/s 80IA of the Act is a patent mistake amenable to rectification u/s 154 - The rectification so effected in the present case by adjusting brought forward depreciation against profits of the business before granting deduction u/s 80IA of the Act is therefore upheld. In the case of Royal Cushion [2008 (10) TMI 707 - BOMBAY HIGH COURT] the rectification carried out by denying deduction u/s 80HHC of the Act for the purposes of computing Book Profits u/s 115JB of the Act, was held to relate to the debatable issue of computation of deduction u/s 80HHC of the Act. The decision in the case of Hirsh Bracelet [2019 (9) TMI 250 - ITAT BANGALORE] goes against the assessee and supports our findings since it holds that Unabsorbed depreciation is deemed to be current years depreciation to be set off against all incomes as per section 32(2) r.w.s 71 of the Act. In the case of SRA systems [2021 (3) TMI 1133 - MADRAS HIGH COURT] was seized with the issue of set off of unabsorbed depreciation prior to deduction u/s 10A of the Act, which it was held was not tenable in law since deduction u/s 10A of the Act was to be made while computing the gross total income under chapter IV of the Act and not at the stage of computation of total income under chapter VI of the Act, being exemption provisions. In the present case the issue relates to deduction u/s 80IA of the Act which is to be made at the stage of computation of total income under chapter VI of the Act. Hence the ratio laid down in the said decision cannot apply to the present case. Appeal dismissed.
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