TMI Blog1994 (2) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... nce it was a belated return, it was simply lodged. For assessment 1988-89, the assessee was granted registration as a partnership firm. Out of Rs. 1,05,658 profit earned for assessment year 1988-89, the assessee claimed set off of unabsorbed depreciation of Rs. 82,508 relating to assessment year 1986-87. However, the set off was refused since there was a change in the status of the assessee, that since the income-tax return for assessment year 1986-87 was simply lodged and, therefore, the Income-tax Officer merely said that the question of set-off of unabsorbed depreciation relating to assessment year 1986-87 does not arise. Thus he disallowed Rs. 82,508 and added it as part of the income returned. For assessment years 1987-88 and 1988-89, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment that simply because in the assessment year 1986-87, the status of the assessee was recognised as URF and for assessment year 1989-90, the status of the assessee was recognised as R.F. that by itself does not disentitle carry forward of depreciation of earlier years. The Deputy Commissioner (Appeals) found in his impugned assessment order that what is vital in the appeal before him so as to decide as to whether unabsorbed depreciation relating to assessment year 1986-87 could be set off against the income of this year is to find out whether the loss in the year 1986-87 though arising out of unabsorbed depreciation was determined by the Assessing Officer at the time of assessment or not. Until and unless the loss is determined whether ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Leasing Finance (P.) Ltd. v. Asstt. CIT [1991] 37 ITD 506 (Delhi) (3) Vora Industries Tools (P.) Ltd. v. ITO [1991] 39 ITD 116 (Pune). It contended that refusal to set off the unabsorbed depreciation is quite illegal and that part of the order of the Deputy Commissioner (Appeals) is to be reversed. It is submitted that for assessment year 1989-90, the assessee can file its return within 31-8-1989. The objection that because the income-tax return for assessment year 1986-87 was filed late and since the unabsorbed depreciation was not ascertained in that year it should not be allowed to be set off from out of the profits for assessment year 1989-90 does not appear to be correct under law. Firstly, the Hon'ble Supreme Court in Jaipuri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imed the deduction before the ITO would be immaterial and the ITO would be bound to set off the unabsorbed depreciation against the balancing charge." Therefore, even assuming for a while that for an intervening assessment year, the assessee did not file the income-tax return, and did not claim set off of unabsorbed depreciation, it amounts to saying that the assessee did not claim set off. According to the Calcutta High Court, simply because the set off was not claimed, it does not debar the assessee to claim set-off of unabsorbed depreciation from the profits of the subsequent years. 6. The third decision to which I want to refer is the decision of the Pune Bench of the Tribunal in Vora Industries Tools (P.) Ltd.'s case. The following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of the Supreme Court in CIT v. Manmohan Das [1966] 59 ITR 699, the Income-tax Officer making subsequent assessments was not bound by the order of his predecessor to the effect that the assessee was not entitled to carry forward of depreciation and he was not bound to give effect to unabsorbed depreciation carried forward from the earlier year. Even though there is any such order of the Income-tax Officer made while making the assessment order in any of the previous assessment years in which there was a loss, the subsequent Assessing Officer who was assessing the assessee in any profit-earning year is not bound by any of his predecessor's orders and he is bound to give set off of unabsorbed depreciation under section 32(2) of the In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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