TMI Blog2008 (9) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... should be treated as the only source of income of the assessee. 1.3 The appellant prays that the past losses etc. should not be set off against the current profits of the unit for calculating deduction under section 80-I of the Act. Without Prejudice to Ground No. 1 II.1 The learned Commissioner of Income-tax (Appeals) erred in not considering the provisions of section 34A being restriction on unabsorbed depreciation and investment allowance for limited period in case of certain domestic companies. II.2 The appellant prays that the restrictive provisions of section 34A be considered while arriving at the profit of the unit. 3. The material facts are like this. In the previous year relevant to the assessment year 1988-89, the assessee had set up its new industrial undertaking in Kodinar. There is no dispute that this unit is eligible for deduction under section 80-I. All along in the past, and in the year in appeal before us, the said unit was the only unit belonging to the appellant and hence its only source of earning as the assessee did not have any other unit or any other source of income, other than the income from Kodinar unit. In the earlier years, the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame unit, even though the same may have been set off against profits of the assessee from other sources. According to the revenue, and as upheld by the CIT(A), the deduction is to be allowed only in respect of the net profits and gains from such unit after making these adjustments. 6. The plea of the assessee appears to be well taken. The expression used in section 80-I(6) is "as if such industrial undertaking... were the only source of income of the assessee during the previous years" in question. In case there are more than one units owned by the assessee, it poses no difficulty because in such a case only the profits or losses of that unit are to be taken into account. The other incomes earned by the assessee do not come into play at all. However, when there is only one unit owned by the assessee, all incomes of the assessee are to be treated as income of that solitary unit - whether derived from the industrial undertaking or not. Therefore, when the unabsorbed depreciation and investment allowance of the unit is set off against the income from other sources, such depreciation or unabsorbed depreciation cannot indeed be taken into account for computing the income of the indust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appeal is allowed in the terms indicated above. Per I.P. Bansal, Judicial Member.- I have gone through the proposed draft order authored by my learned brother Shri Pramod Kumar. However, I am in respectful disagreement with the opinion expressed in the said order. Therefore, I proceed to pass a dissenting order as under:- 2. The original assessment in the present case was completed vide order dated 28-2-1995 passed under the provisions of section 143(3) of the Income-tax Act, 1961 at an income of Rs. 25,61,310, in which deduction under section 80-I was allowed at a sum of Rs. 8,70,90,300 being at the rate of 25 per cent of business profit of the eligible unit relating to the current year. The said assessment was reopened by issuing notice under section 148 dated 8-8-1996 for the reason that deduction under section 80-I was allowed excessively due to the fact that while computing section 80-I deduction, the brought forward losses, unabsorbed depreciation and Investment Allowances of the said unit were not reduced from the profits of the current year even though they were set off against the income from other sources in the earlier years. Reference was made to section 80-I( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -------------- 25 per cent of the above Rs. 5,76,06,501 (i.e., 80-I deduction) 4. An appeal was filed before the CIT(A) before whom it was submitted that the Assessing Officer had set off the past losses, etc., against the other income and only the remaining past losses, etc., should have been considered for the purpose of computing deduction under section 80-I. Without prejudice, it was submitted that the restrictive provisions of section 34A should be considered while arriving at the profit of the unit. 5. The ld. CIT(A) has upheld the action of the Assessing Officer. He also found that the Assessing Officer has arrived at the eligible profit for allowing set off of only 2/3rd of brought forward depreciation/investment allowance. Hence he declined to interfere with the order of the Assessing Officer. It is relevant to mention here that while giving effect to the order of the CIT(A) dated 7-3-1996 passed in respect of original assessment, the Assessing Officer vide order dated 29-3-1996, has allowed the set off of carried forward unabsorbed investment allowance to the extent of 2/3rd by restricting the allowance to 1/3rd and the computation in this rega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng or a ship or the business of a hotel [or the business of repairs to ocean-going vessels or other powered craft], to which this section applies, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to twenty per cent thereof: Provided that in the case of an assessee, being a company, the provisions of this sub-section shall have effect [in relation to profits and gains derived from an industrial undertaking or a ship or the business of a hotel] as if for the words "twenty per cent", the words "twenty-five per cent" had been substituted. (6) Notwithstanding anything contained in any other provision of this Act, the profits and gains of an industrial undertaking or a ship or the business of a hotel [or the business of repairs to ocean-going vessels or other powered craft] to which the provisions of subsection (1) apply shall, for the purposes of determining the quantum of deduction under sub-section (1) for the assessment year immediately succeeding the initial assessment year or any subsequent assessment year, be computed as if such in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l or eligible business of repairs to ocean-going vessels or other powered craft were the only source of income of the assessee, during the previous years relevant to the initial assessment year and to every subsequent assessment year up to and including the assessment year for which the determination is to be made." In other words, for the purposes of determining the quantum of "tax holiday" profits under section 80-I, the taxable income of the eligible industrial undertaking, etc., is to be ascertained as if such undertaking were an independent unit owned by the assessee concerned and the assessee had no other source of income. Consequently, the unabsorbed losses, unabsorbed depreciation, etc., relating to the eligible industrial undertaking, etc., are to be taken into account in determining the quantum of deduction under section 80-I even though these may actually have been set off against the income of the assessee from other sources. This position with regard to section 80-I(6) has been explained at pages 3594 and 3595 of Chaturvedi Pithisaria's Income-tax Law, Fifth Edition, Volume 2. 11. From the plain reading of section 80-I(1) and (6) it is clear that the profits and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no scope for importing any rule of interpretation. It will be relevant to reproduce the. following observations of the Hon'ble Supreme Court in the case of Pandian Chemicals Ltd.: "6. The word 'derived' has been construed as far back in 1948 by the Privy Council in CIT v. Raja Bahadur Kamakhaya Narayan Singh [1948] 16 ITR 325 when it said: 'The word 'derived' is not a term of art. Its use in the definition indeed demands an enquiry into the genealogy of the product. But the enquiry should stop as soon as the effective source is discovered. In the genealogical tree of the interest land indeed appears in the second degree, but the immediate and effective source is rent, which has suffered the accident of non-payment. And rent is not land within the meaning of the definition.' This definition was approved and reiterated in 1955 by a Constitution Bench of this Court in the decision of Mrs. Bacha F. Guzdar v. CIT [1955] 27 ITR 1 (SC). It is clear, therefore, that the words 'derived from' is section 80HH of the Income-tax Act, 1961 must be understood as something which has direct or immediate nexus with the appellant's industrial undertaking. Although electricity may be requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the rules of interpretation would come into play only if there is any doubt with regard to the expressed language used and where the words are unequivocal, there is no scope for importing any rule of interpretation. Looking the present controversy in view of above discussion it is clear that the income earned by way of interest, capital gains and dividend cannot in any way be considered as income derived by the assessee from the eligible industrial undertaking as these income do not flow directly from the eligible industrial undertaking itself, I may point out here that there is no dispute so as it regards to the set off of past losses, unabsorbed depreciation and investment allowance of the eligible unit with the income earned by the assessee from other sources in the shape of interest, capital gains and dividend which has already been assessed as income from other sources in earlier years. In this view of the situation, in my opinion, the Assessing Officer was right in excluding the income earned by the assessee in the past years which was assessed as income from other sources compute profit and gains derived by the assessee from its eligible industrial undertaking as acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble Supreme Court in the case of IPCA Laboratories v. Dy. CIT [2004] 266 ITR 521 was applied. 14. In view of above discussion, therefore, the impugned order of the Assessing Officer has to be upheld and the ld. CIT(A) has rightly upheld his order. 15. Now coming to the alternative ground of the assessee, it has been contended in the grounds of appeal that the learned CIT(A) erred in not considering the provisions of section 34A being restriction on unabsorbed depreciation and unabsorbed investment allowance for limited period in case of certain domestic companies. It is seen from the order of the ld. CIT(A) that he has considered this ground of the assessee as per the following observations:- "5.... Section 34A, introduced by Finance Act, 1992 provides that in the case of domestic companies only 661 per cent of unabsorbed depreciation/investment allowance carried forward from earlier years shall be allowed to be deducted from the business income and balance shall be allowed to be carried forward to be set off in subsequent years. The Assessing Officer has arrived at the eligible profit after allowing set off of only 2/3rd of brought forward depreciation/investment al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... depreciation allowance or investment allowance under this section and the assessee has paid the amount of shortfall before furnishing the return of income under sub-section (1) of section 139." The provisions of section 34A(1) contemplates a situation where,- "In computing the profits and gains of the business of a domestic company in relation to the previous year relevant to assessment year 1992-93, Effect is to be given to the unabsorbed depreciation allowance or unabsorbed investment allowance or both in relation to any previous year relevant to assessment year 1991-92 or any earlier assessment year." In such a situation, for the assessment year 1992-93, the deduction shall be restricted to 2/3rd of such allowance or allowances and the balance,- "Where it relates to depreciation allowance, be added to the depreciation allowance for the previous year relevant to the assessment year 1993-94 and be deemed to be part of that allowance or if there is no such allowance for that previous year, be deemed to be the allowance for that previous year and so on for the succeeding previous years; Where it relates to investment allowance, be carried forward to the assessment year 199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble President of ITAT with a request that following questions may be referred to a Third Member or pass such order as the Hon'ble President may think fit. "1. Whether, on the facts and in the circumstances of the case, a sum of Rs. 4,35,52,000 (aggregate of brought forward unabsorbed losses, depreciation and investment allowance relating to the eligible industrial undertaking and which was set off in assessment years 1988-89 to 1991-92 against income of assessee from interest capital gain and dividend) is required to be reduced as per section 80-I(6) of the Income-tax Act, 1961 from current year's profits derived by assessee from its eligible industrial undertaking for the purpose of computing deduction under section 80-I(1) of the Act? 2. Whether the provisions of section 80-I(6) are liable for two interpretations? 3. Whether rule of liberal interpretation can be applied while interpreting the provisions of section 80-I(6)?" THIRD MEMBER ORDER Per M.A. Bakshi, Vice President (As a Third Member).- The appeal of the assessee for assessment year 1992-93 was heard by a Division Bench of the Tribunal and as a result of difference of opinion amongst Members of the Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f in the respective assessment years against the other income of the assessee, say income from other sources, capital gains, etc., the details of which as are relevant are indicated as below:- ------------------------------------ A.Y. Nature Amount (Rs.) ------------------------------------ 1988-89 Interest 68,000 ------------------------------------ 1989-90 -do- 18,51,000 ------------------------------------ 1990-91 -do- 46,43,000 ------------------------------------ 1990-91 Capital gain 32,28,000 ------------------------------------ 1991-92 Interest 1,09,99,000 ------------------------------------ 1991-92 Dividend 84,29,000 ------------------------------------ 1991-92 Capital gain 1,43,34,000 ------------------------------------ For the year under appeal, the assessment under section 143(3) had been completed by the Assessing Officer on 28-2-1995, determining the total income at Rs. 25,61,310. Deduction under section 80-I at the rate of 25 per cent of business profits of the eligible unit relating to the current year was allowed at Rs. 8,70,90,300 and after giving effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view expressed by learned Accountant Member and held that section 80-I(6) is applicable in this case insofar as the fiction "of the assessee having only income from the eligible unit" was applicable in respect of the income derived from the industrial undertaking and not to any other income earned by the assessee from any other source. 9. Before me, the learned counsel for the assessee reiterated the contentions advanced before the Division Bench. It was contended that the assessee was owner of only one unit from assessment years 1988-89 till the end of the previous year under appeal. Whatever income was earned by the assessee was the income of the sole industrial unit of the assessee. It was contended that the fiction under section 80-I(6) is applicable in such cases where the assessee is the owner of more than one unit. According to the learned counsel for the assessee, if the assessee is the owner of only one unit, the income from various heads of income would belong to the industrial unit. It was further contended that the interest income earned by the assessee was part of the business income of the industrial undertaking. It was contended that there is a distinction between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee is the owner of only one unit and no loss has been set off against the "income of any other unit. It was further contended that the learned Judicial Member has referred to the decisions of the Supreme Court in the case of Sterling Foods and Pandian Chemicals Ltd., which relate to the meaning of the words "derived from". According to the learned counsel, the words "derived from" is irrelevant for the purpose of interpreting of the provisions of section 80-I(6) relying upon the decision of the Supreme Court in the case of CIT v. Mother India Refrigeration Industries (P.) Ltd. [1985] 155 ITR 711, it was contended that the fiction created under section 80-I(6) cannot be stressed beyond the purpose for which it was incorporated. Further reliance was placed on the decision of the Supreme Court in the case of Petron Engineering Construction (P.) Ltd. v. CBDT [1989] 175 ITR 523 to support the contention that if there is no violence to the language then liberal interpretation is required to be given to the provisions of the Act. 9.1 The learned counsel for the assessee further contended that even assuming that there is a Legislative omission in section 80-I(6), the same canno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been made to various decisions, claimed to be directly on this issue. The learned DR contended that the assessee was claiming double deduction, which was not permissible in law. Inviting my attention to the decision of the Mumbai Bench of the Tribunal in the case of Tolani Ltd. v. Dy. CIT [2004] 89 ITD 551, Para 8, it was pointed out that the issue decided by the Tribunal relates to section 80-I(6) and it supports the view of the revenue authorities. Similarly, in the case of Shri Rama Krishna Mills (CBE) Ltd. v. Dy. CIT [2006] 7 SOT 356, the Chennai Bench of the Tribunal has taken same view relating to the provisions of section 80-I(6) as canvassed by the Departmental Authorities. Reliance was also placed on the decision of the Bombay High Court in the case of Synco Industries Ltd. v. Assessing Officer of Income-tax [2002] 254 ITR 608, wherein, according to the learned DR, provisions of section 80-I(6) have also been considered. It has further been submitted that the decision of the Bombay High Court has been affirmed by the Hon'ble Supreme Court in Synco Industries Ltd. v. Assessing Officer, Income-tax [200S] 299 ITR 444. 10.1 Further the learned DR has invited my attention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ufacture or produce articles or things or to operate its cold storage plant or plants; or (ii) a ship which is first brought into use; or (iii) the business of a hotel which starts functioning, on or after 1-4-1990, but before 1-4-1991, there shall, in accordance with and subject to the provisions of this section, be allowed in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to twenty-five per cent thereof: Provided that in the case of an assessee, being a company, the provisions of this sub-section shall have effect in relation to profits and gains derived from an industrial undertaking or a ship or the business of a hotel as if for the words "twenty-five per cent", the words "thirty per cent" had been substituted. (2) This section applies to any industrial undertaking which fulfils all the following conditions, namely:- (i) it is not formed by the splitting up, or the reconstruction, of a business already in existence; (ii) it is not formed by the transfer to a new business of machinery or plant previously used for any purpose; (iii) it manufactures or produces any article or thing, not being any article or thin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e total value of the machinery or plant used in the business, then, for the purposes of clause (ii) of this sub-section, the condition specified therein shall be deemed to have been complied with. Explanation 3.-For the purposes of this sub-section, "small-scale industrial undertaking" shall have the same meaning as in clause (b) of the Explanation below sub-section (8) of section 80HHA. (3) This section applies to any ship, where all the following conditions are fulfilled, namely:- (i) it is owned by an Indian company and is wholly used for the purposes of the business carried on by it; (ii) it was not, previous to the date of its acquisition by the Indian company, owned or used in Indian territorial waters by a person resident in India; and (iii) it is brought into use by the Indian company at any time within the period of ten years next following 1-4-1981. (4) This section applies to the business of any hotel, where all the following conditions are fulfilled, namely:- (i) the business of the hotel is not formed by the splitting up, or the reconstruction, of a business already in existence or by the transfer to a new business of a building previously used as a hotel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articles or things or to operate its cold storage plant or plants; or (ii) a ship which is first brought into use; or (iii) the business of a hotel which starts functioning, on or after 1-4-1990 but before 1-4-1991, provisions of this subsection shall have effect as if for the words "seven assessment years", the words "nine assessment years" had been substituted: Provided also that in the case of an assessee, being a co-operative society, deriving profits and gains from an industrial undertaking or a ship or a hotel referred to in the third proviso, the provisions of that proviso shall have effect as if for the words "nine assessment years", the words "eleven assessment years" had been substituted. (6) Notwithstanding anything contained in any other provision of this Act, the profits and gains of an industrial undertaking or a ship or the business of a hotel or the business of repairs to ocean-going vessels or other powered craft to which the provisions of sub-section (1) apply shall, for the purposes of determining the quantum of deduction under sub-section (1) for the assessment year immediately succeeding the initial assessment year or any subsequent assessment year, be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other source of income. Consequently, the unabsorbed losses, unabsorbed depreciation, etc., relating to the eligible industrial undertaking are to be taken into account in determining the quantum of deduction under section 80-I even though these may actually have been set off against the profits of the assessee from other sources of income of the assessee. 12.3 In this case the assessee is a company and in the previous year relevant to assessment year 1988-89, the assessee had set up its new industrial undertaking in Kodinar for production of cement. From assessment years 1988-89 onwards the assessee has suffered losses on the production and sale of cement but had earned income by way of interest, dividend and capital gains The losses of the industrial unit have been set off against the interest, dividend and capital gains. In the year under appeal the assessee has been found to be eligible for deduction under section 80-I. The dispute, as pointed out earlier, is limited to the manner of application of sub-section (6) of section 80-I. It may be reiterated that the learned Judicial Member has concurred with the view expressed by the Assessing Officer that for purposes of giving e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection (6) of section 80-I. Section 80-I was inserted by the Finance (No. 2) Act, 1980. It would be relevant to refer to the Departmental Circular No. 281, dated 22-9-1980. In Para 19.4 it has been explained as under:- "19.4 The new "tax holiday" scheme differs from the existing scheme in the following respects, namely:- (i) The basis of computing the "tax holiday" profits has been changed from capital employed to a percentage of the taxable income derived from the new industrial unit, ship or approved hotel. In the case of companies, 25 per cent of the profits derived from new industrial undertakings, etc., will be exempted from tax for a period of eight years and in the case of other taxable entities, 20 per cent, of such profits will be exempted for a like period. In the case of co-operative societies, however, the exemption will be allowed for a period of ten years instead of eight years. (ii) The benefit of "tax holiday" under the new scheme would be admissible to all small-scale industrial undertakings even if they are engaged in the production of articles listed in the Eleventh Schedule to the Income-tax Act. In the case of other industrial undertakings, however, the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s derived from a ship, a deduction shall be allowed, in computing the total income, from such profits and gains of an amount equal to 25 per cent of such profits. Sub-section (6) provides for the method of computing the profits of the ship in respect of which the assessee is eligible to the deduction. It says that such profits shall be computed as if the ship is the only source of income of the assessee during the relevant previous year. It has to be borne in mind that the sub-section starts with a non obstante clause. Therefore, the effect of the other provisions of the Act has to be ignored while computing the profits of the ship concerned under the sub-section. This means that the effect of section 33AC, as it stood before the amendment, will also have to be ignored. This is what the Assessing Officer has done. For purposes of determining the quantum of deduction under sub-section (1) of section 80-I, he has proceeded to compute the profits of "Prabhu Das" in accordance with sub-section (6), by assuming that the only source of income of the assessee during the relevant previous year was the ship "Prabhu Das". He has arrived at the gross income of Prabhu Das at Rs. 1,33,26,785 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions are of overriding in nature, providing that during each of the assessment years in the tax holiday period in which the assessee is entitled to deduction under section 80-I, the provision will be applied as if industrial undertaking is an independent unit and one and only source of income possessed by the assessee. Thus, in any assessment year, if the industrial undertaking suffers loss (both business and/or depreciation loss) but the same have been absorbed by the other income of the assessee in the subsequent year or years during the tax holiday period, the said loss will have to be adjusted against the eligible profits and gains from industrial undertaking and tax holiday benefits under section 80-I computed only on the balance. This is the real intention of the Legislature. These provisions were specifically incorporated as assessee's may set off the loss arising in the undertaking to any other income from other business which gives an undue advantage vis-a-vis to another case where there)s no other business to set off such losses in the respective assessment years. Otherwise, it would lead to unreasonable result...." 12.8 The learned counsel for the assessee is heavily ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 1,91,38,345 (iv) Misc. Income Rs. 31,91,509 (v) Insurance Claim Rs. 16,60,227 (vi) Profit on disposal of asset Rs. 14,021 ---------------- Rs. 10,33,43,925 ---------------- From the details of miscellaneous income of Rs. 31,91,500, it is noticed that this is\mainly on account of sale of scrap and sale of used cement bags, sale of old newspapers etc., and claims received from railways in connection with the transportation assistant. Similarly, insurance claim of Rs. 16,60,227 received by the assessee is on the insurance of the various plant and machinery and other fixed assets of the industrial undertaking. The profit on disposal of assets is Rs. 14,021. Besides the assessee had following income in assessment year 1992-93:- (a) Dividend : Rs. 3,39,15,516 (b) Profit on sale of investments : Rs. 4,54,24,307 (c) Interest : Rs. 1,91,38,345 ---------------- Rs. 9,84,78,168 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 342.75 Unit Scheme 1964 (Repurchase Value Rs. 355.00 lakhs; previous period Rs. 351.25 lakhs) 239475 Equity shares of Rs. 10 each of GACL Finance Ltd. (Subsidiary Co.) 23.95 700 Equity shares of Rs. 10 each of Concrete Investments Ltd. (Subsidiary Co.) 0.07 24.02 - ------ ------ 872.35 496.60 ------ ------ (200000 11 per cent State Loans 2001, 10000 9 per cent Hudco Bonds and 2500000 Units of UTI were purchased for Rs. 305.28 lakhs, Rs. 103 lakhs and Rs. 325.40 lakhs respectively and sold during the year) ------------------------------------------------------------ It is evident from Schedule 'F' of the Balance Sheet that the assessee has itself segregated the investments, which are not related to its trade. The trade of the assessee in the year under appeal as well as in earlier years, admittedly, was the production of cement, which was being carried on by means of the industrial undertak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he second limb of the contention advanced on behalf of the assessee, which has been accepted by the learned Accountant Member. To recapitulate, the contention advanced on behalf of the assessee is that in the case of an assessee, who owns only one-industrial undertaking, the income from all sources has got to be treated as the income of the industrial undertaking. This contention, at the first sight, may appear to be attractive but in my humble view, it loses its luster when the assessee as a company and the industrial unit being one of its income earning apparatus is considered to exist independently. Under the Income-tax Act, 1961, tax is chargeable on the income of every person. Section 4 of the Act is the charging section, which reads as under:- "4. (1) Where any Central Act enacts that income-tax shall be charged for any assessment year at any rate or rates, income-tax at that rate or those rates shall be charged for that year in accordance with, and [subject to the provisions (including provisions for the levy of additional income-tax) of, this Act] in respect of the total income of the previous year of every person: Provided that where by virtue of any provision of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent and separate and the entire income from both the units and from any other source belongs to the company, namely the assessee and not the industrial unit No. The position of law will not be different if the assessee owns only one unit and has also income from other sources of income. In such a case, the assessee will have income from industrial unit and the income from other sources of income will be treated as the income of the industrial unit but the income of the company. 12.11 Taking the totality of facts and circumstances of this case into consideration, lam of the considered view that a sum of Rs. 4,35,52,000 (aggregate of brought forward unabsorbed losses, depreciation and investment allowance relating to the eligible industrial undertaking and which was set off in assessment years 1988-89 to 1991-92 against income of assessee from interest, capital gain and dividend) is required to be reduced as per section 80-I(6) of the Income-tax Act, 1961 from current year's profits derived by the assessee from its eligible industrial undertaking for the purpose of computing deduction under section 80-I(1) of the Act. I hold accordingly. Consequently, with due respects I disagre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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