2010 (8) TMI 648

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..... lled by it and if so, whether the unabsorbed depreciation of the earlier years to be reduced from profits for computing deduction under section 80IA of the Income-tax Act, is valid?   2. Whether on the facts and circumstances of the case, the Income-tax Appellate Tribunal was right in law in not following the decision of the special Bench in the case of Gold Mine Shares & Finance P. Ltd. reported in 302 ITR (AT) 208 (Ahamedabad) which directly applicable to the facts of this case?   2. It was fairly brought to our notice that in the decision reported in (2010) 231 CTR (Mad) 368 (Velayudhaswamy Spinning Mills (P) Ltd. vs. Assistant Commissioner of Income-tax), these very questions have been dealt with and answered against the Rev .....

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..... the assessment year was 2005-2006 and in the Tax Case No.918 of 2008 the assessment year was 2004-2005. During the relevant period, there were no unabsorbed depreciation or loss of the eligible undertakings and the same were already absorbed in the earlier years. There is a positive profit during the year. The unreported judgment of this Court cited supra considered the scope of sub-section 6 of Section 80I, which is the corresponding provision of sub-section 5 of Section 80-IA. Both are similarly worded and therefore we agree entirely with the Division Bench judgment of this Court cited supra. In the case of COMMISSIONER OF INCOME TAX V. MEWAR OIL AND GENERAL MILLS LTD., reported in 271 ITR 311 the Rajasthan High Court also considered the .....

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..... albeit, for reasons somewhat different from those which prevailed with the Tribunal. There being no carry forward of allowable deductions under the head depreciation or development rebate which needed to be absorbed against the income of the current year and, therefore, re-computation of income for the purpose of computing permissible deduction under section 80-I for the new industrial undertaking was not required in the present case. Accordingly, this appeal fails and is hereby dismissed with no order as to costs."   From reading of the above, the Rajasthan High Court held that it is not at all required that losses or other deductions which have already been set off against the income of the previous year should be reopened again fo .....

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