Section 80A - deduction under chater VIA - If in any case the gross total income is a loss therefore no deduction can be allowed as the provisions of section 80A(2) - Income Tax - 572/CBDT

INSTRUCTION NO. 572/CBDT Dated : July 23, 1973 Section(s) Referred: Chapter VIA Statute: Income - Tax Act, 1961 The Board have been informed that in one case a deduction under Chapter VIA of the Income-tax Act, 1961 was allowed although the assessment resulted in a loss thereby enhancing the loss to be carried forward to the subsequent year. Revenue Audit objected to this action and the objection has been accepted by the Board. 2. Reference is invited to section 80A(2) which provides that the aggregate amount of the deductions in Chapter VIA shall not in any case exceed the gross total income of the assessee. The maximum amount of deduction permissible within the provisions of this Chapter VIA has thus to be restricted to the amount of gross total income of an assessee. If in any case the gross total income is a loss therefore no deduction can be allowed as the provisions of section 80A(2) will come into operation. 3. Necessary instructions may please be issued to the Income-tax Officers working in your charge on the lines indicated above. A review of the relevant completed assessments where loss has been finally determined may be undertaken with a view to withdraw, as may be possible, the deductions, if any, allowed under the provisions of Chapter VIA, in excess of the gross total income. A compliance report may please be sent to the Board by 15th September, 1973 indicating the number of cases in which rectificatory action has been taken and the tax effect.