TMI Blog1972 (1) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Income-tax Act, 1961. "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the deduction under section 80E has to be worked out on the adjusted total income of the year, after setting off the losses brought forward from the preceding year?" The year of assessment is 1967-68. The Income-tax Officer determined the total income assessable to tax for that year at Rs. 2,13,769. The loss in the earlier years amounting to Rs. 87,437 was then set off against the profits and gains arising from the business of the assessee which is a limited company, apparently under section 72 of the Income-tax Act, 1961. From the balance net income of Rs. 1,26,332, 8 per cent. was deducted under section 80 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company; or (b) any other company which has made the prescribed arrangements for the declaration and payment of dividends (including dividends on preference shares) within India, but does not apply to any Indian company referred to in clause (a), or to any other company referred to in clause (b), if such Indian or other company is a company referred to in section 108 and its total income as computed before applying the provisions of sub-section (1) does not exceed twenty-five thousand rupees." Counsel for the assessee contended that the view taken by the Tribunal is not justified by the section. According to him, the computation of the total income of profits and gains arising from the business does not involve the application of sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd after permitting the deductions under section 80E. Counsel for the revenue submits that the process must be reversed and before the deduction under section 80E is made, the set-off under section 72 must be allowed. Section 80E seems to be a special provision and permits deduction from profits and gains attributable to specific activities like business of generation or distribution of electricity or any other form of power or of construction, manufacture or production of any one or more of the articles or things specified in the List in the Fifth Schedule. The set-off under section 72 is applicable in relation to the profits and gains arising from any business or profession. We, therefore, think that the deduction under section 80E is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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