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2007 (2) TMI 248 - ITAT DELHI-FDeduction u/s 10A - Set-off of loss pertaining to the unit of the appellant eligible for exemption u/s 10A against profits of the other units of the appellant for the relevant year - HELD THAT:- In our opinion, the learned CIT(A) has misread the provision of s. 10A and has misinterpreted the same. By Finance Act, 2000 w.e.f. 1st April, 2001 the provision of s. 10A has been substantially amended. As per s. 10A(1) deduction of such profits and gains as are derived by an undertaking from the export of articles or things or computer software shall be allowed from the total income of the assessee. Thus though s. 10A is part of Chapter III, still as per s. 10A(1) only deduction of profits derived by an undertaking is to be allowed to the assessee from the total income of the assessee. Thus the prerequisite is that the total income of the assessee is to be computed. The total income can be computed only after allowing intra-head set-off u/s 70 and inter-head set-off u/s 71 of the Act. It is settled principle governing interpretation of statutes that marginal notes to the sections, or headings cannot control the construction of the statute. The title given to a chapter cannot legitimately be used to restrict the plain terms of an enactment or to construe a section thereunder. These are internal aids to construction. However, such internal or external aids to construction can be roped in provided the section under the statute is either not clear or ambiguous. The interpretation has to be based on the section itself and even the intention of legislature can be best found as recorded in the section itself and only in case the language of section is not clear or ambiguous such internal or external aids to interpretation of statutes can be brought into. The Hon'ble Supreme Court in the case of K.P. Varghese vs. ITO [1981 (9) TMI 1 - SUPREME COURT] observed that the marginal notes to a section cannot be referred to for the purpose of construing the section but it can be relied upon as indicating the drift of the section and to show what the section is dealing with. It cannot control the interpretation of the words of a section particularly when the language of section is clear and unambiguous, In the present case since provision of s. 10A(1) is clear which provides that deduction of profits and gains as are derived by an undertaking shall be allowed from the total income of the assessee, merely because it falls under Chapter III which is titled "Incomes which do not form part of total income", the same cannot be considered to be an exemption provision so as to deny the assessee benefit of ss. 70 and 71 of the Act. Further, the provisions of s. 10A/10B of the Act are intended to confer a benefit to the assessee. The provisions cannot be used as a lever/tool to the disadvantage of the assessee by reading the restriction in the provisions of s. 10A that the loss of the eligible unit is not to be set-off as per ss. 70 and 71 of the Act. The set-off of a loss of the amorphous unit against the profit of the other unit as per s. 70 of the Act, therefore, has wrongly been denied in the assessment completed u/s 143(3) of the Act. Thus, it is held that the set-off of losses of the amorphous division of the assessee against the profit of the other units has wrongly been declined. Hence, the appeal of the assessee is allowed - Since the appeal of the assessee has been disposed of, the stay petition has become infructuous and is accordingly to be dismissed.
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