TMI Blog2022 (3) TMI 438X X X X Extracts X X X X X X X X Extracts X X X X ..... the stage of computation of the total income under Chapter VI . Further, it is to be noted that though the decision of the Karnatake High Court [ 2006 (8) TMI 125 - KARNATAKA HIGH COURT] referred to above on the side of the appellant / Revenue was appealed by the Assessee therein [ 2013 (10) TMI 823 - SC ORDER] to the supreme court and the said appeal was dismissed by confirming the said view by order, dated 19.09.2013, this court is of the opinion that the view of the Karnataka High Court that the deduction under Chapter VI A has to be made only after or subsequent to the brought forward depreciation allowances, seems to have been taken depending on that particular case and hence, the same cannot be straight away applicable to all th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0A is to be computed after or before setting off of the losses / depreciation is debatable and therefore CIT had no jurisdiction under Section 263 to revise the assessment order? 3.The facts of the case are that appellant / assessee filed its return of income on 30.10.2004 admitting 'Nil' income after claiming deduction under section 10A of the Income-tax Act, 1961 (in short, 'the Act'), amounting to ₹ 40,92,756/-. The return was processed and the assessing officer passed the assessment order on 29.08.2006 under section 143(3) of the Act. Subsequently, notice under section 263 was issued to the assessee on 06.02.2009, stating that deduction of ₹ 42,26,504/- was allowed under section 10A of the Act, before set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le undertaking under Chapter IV of the Act and not at the stage of computation of the total income under Chapter VI . The relevant passage of the said decision is usefully extracted below: 12. We have considered the submissions advanced and the provisions of Section 10A as they stood prior to the amendment made by the Finance Act, 2000 with effect from 1-4-2001; the amended Section 10A thereafter and also the amendment made by the Finance Act, 2003 with retrospective effect from 1.4.2001. 13. The retention of Section 10A in Chapter III of the Act after the amendment made by the Finance Act, 2000 would be merely suggestive and not determinative of what is provided by the section as amended, in contrast to what was provided by the un-a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales would have to enter into the computation under the head profits and gains from business in Chapter IV and denied the benefit of deduction. The provisions of sub-section (6) of Section 10A, as amended by the Finance Act of 2003, granting the benefit of adjustment of losses and unabsorbed depreciation, etc. commencing from the year 2001-02 on completion of the period of tax holiday also virtually works as a deduction which has to be worked out at a future point of time, namely, after the expiry of period of tax holiday. The absence of any reference to deduction under Section 10A in Chapter VI of the Act can be understood by acknowledging that any such reference or mention would have been a repetition of what has already been provided i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... takings, as the case may be, and this shall not have any material relationship with the other business of the assessee outside these zones or units for the purposes of this provision . 17. If the specific provisions of the Act provide [first proviso to Sections 10-A(1); 10-A(1-A) and 10-A(4)] that the unit that is contemplated for grant of benefit of deduction is the eligible undertaking and that is also how the contemporaneous circular of the department (No. 794 dated 09.08.2000) understood the situation, it is only logical and natural that the stage of deduction of the profits and gains of the business of an eligible undertaking has to be made independently and, therefore, immediately after the stage of determination of its profits and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onfirming the said view by order, dated 19.09.2013, this court is of the opinion that the view of the Karnataka High Court that the deduction under Chapter VI A has to be made only after or subsequent to the brought forward depreciation allowances, seems to have been taken depending on that particular case and hence, the same cannot be straight away applicable to all the cases. 8.Following the decision of the Hon'ble Supreme Court in CIT v. Yokogawa India Ltd (supra) , this court has already decided the similar issue relating to computation of deduction under section 10A in favour of the assessee, in TCA Nos.24, 26 and 28 of 2022 by order dated 01.02.2022 in the case of CIT v. M/s.Comstar Automotive Technologies (P) Ltd . 9. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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