TMI Blog2003 (2) TMI 5X X X X Extracts X X X X X X X X Extracts X X X X ..... id provisions of the Companies Act in section 115J is to allow set off of the losses and unabsorbed depreciation. The Tribunal elaborately considered the said provisions and rightly found that the assessee is entitled for adjusting the loss or the unabsorbed depreciation of earlier years whichever is less in computation of the book profit under section 115J. It also considered the Board's circular. We agree with the reasoning and conclusions of the Tribunal - - - - - Dated:- 19-2-2003 - Judge(s) : S. SANKARASUBBAN., KUM. A. LEKSHMIKUTTY. JUDGMENT The judgment of the court was delivered by S. Sankarasubban J.- These references are at the instance of the Revenue and the assessee. The questions of law referred are as follows: "1. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 142(1). However, the Assessing Officer closed the proceedings as follows: "Return of income not yet filed. There is no taxable income from 1984-85 onwards. Assessment may be closed as N.A. for statistical purposes". On March 15, 1990, the assessee filed a return disclosing a loss of Rs. 59,02,550 whereupon the Assessing Officer issued notice under section 148 and completed the assessment under section 143(3) on July 16, 1992 applying the provisions of section 115J of the Income-tax Act and determined the income at Rs. 6,10,000. In arriving at the assessable profit under section 115J, the Assessing Officer did not deduct the loss or depreciation to be set off under section 205(1)(b) of the Companies Act in a sum of Rs. 5,18,3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the assessment as "N.A" Thus, the impugned entry will amount to an order under section 144 of the Income-tax Act. The mere fact that it was not communicated to the assessee will not make such an assessment recorded in the order sheet illegal as has been held in the case of V. S. Sivalingam Chettiar v. CIT [1966] 62 ITR 678 (Mad) and CIT v. Trustees of H. E. H. Nizam's Second Supplemental Family Trust [1985] 151 ITR 562 (AP). The Supreme Court in CIT v. Bidhu Bhusan Sarkar [1967] 63 ITR 278 held that the endorsement filed may amount to dropping of the proceedings or disposal of the proceedings and that would not bar further proceedings under section 147. Hence, the first question is answered in favour of the Revenue and against the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he profit and loss account. Once it is found that the provisions of clause (b) of the proviso to sub-section (1) of section 205 of the Companies Act are applicable in section 115J and the object of such incorporation of the said provisions of the Companies Act in section 115J is to allow set off of the losses and unabsorbed depreciation. The Tribunal elaborately considered the said provisions and rightly found that the assessee is entitled for adjusting the loss or the unabsorbed depreciation of earlier years whichever is less in computation of the book profit under section 115J. It also considered the Board's circular. We agree with the reasoning and conclusions of the Tribunal and we answer the question referred by the Revenue in favour o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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