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TMI Blog2012 (3) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... f profits and gains of business against income from any other source under the same head - A provision akin to subsection (5) of Section 80IA or for that matter akin to subsection (6) of Section 80I has not been introduced by the Legislature when it enacted Section 10B - Appeal is dismissed - INCOME TAX APPEAL NO.3465 OF 2010 - - - Dated:- 7-2-2012 - DR.D.Y.CHANDRACHUD AND M.S.SANKLECHA, JJ. Mr.Vimal Gupta for the Appellant. Mr.Percy J.Pardiwala, Senior Advocate with Mr.Atul k.Jasani for the Respondent. ORAL JUDGMENT (PER DR.D.Y.CHANDRACHUD, J.) : This appeal by the Revenue under Section 260A of the Income Tax Act, 1961, arises out of the decision rendered by the Income Tax Appellate Tribunal on 22 September 2009 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the grounds of appeal is covered against the Revenue by the Tribunal s order in the case of the assessee, dated 7 February 2005 for Assessment Years 199697 to 199899. The Tribunal by its order held that the assessee had made payment for the use of trade mark which was genuine and in accordance with business exigencies. The payment was held to be allowable as business expenditure. Counsel appearing on behalf of the Revenue states that no appeal has been filed against the decision of the Tribunal in regard to Assessment Years 199697 to 199899. In that view of the matter, since the Tribunal has followed its own decision for the earlier years which has been accepted by the Revenue, no substantial question of law would arise. 3. The second que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he EOU is principally on account of current depreciation. It was urged on behalf of the Revenue that unabsorbed depreciation can be carried forward from year to year and hence, there is no justification for the assessee in seeking to set off of a loss which has been sustained by the EOU against the profit which has resulted from the operation of the other units. Counsel appearing on behalf of the Revenue further sought to place reliance in this regard on the provisions of subsection (6) of Section 10B. Moreover, it is urged that under sub section (8) of Section 10B, the assessee is given an option to submit a declaration to the Assessing Officer to the effect that the provisions of the Section may not be made applicable to it in which case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s year in which the undertaking begins to manufacture or produce such articles or things or computer software, as the case may be. The deduction has to be allowed from the total income of the assessee. In Hindustan Lever Ltd. vs. Deputy Commissioner of Income Tax (2010) 325 ITR 102 (Bom), a Division Bench of this Court considered the provisions of Section 10B, while considering a petition challenging the action of the Assessing Officer in purport to reopen the assessment under Section 148. The Division Bench noted that upon the substitution of the provision by the Finance Act, 2000, Section 10B was no longer a provision for exemption, but a provision for deduction. The Division Bench observed as follows: Plainly, section 10B as it stands ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts while the loss sustained by the fourth unit could be set off against the normal business income. In these circumstances, the basis on which the assessment is sought to be reopened is contrary to the plain language of Section 10B. This decision of the Division Bench has been followed by another Division Bench of this Court in the case of Commissioner of Income TaxII vs. Patni Computers Systems Ltd. Income Tax Appeal 2177/10 decided on 1 July 2011. 6. Quite apart from the fact that the issue stands covered against the Revenue by the view taken by the Division Benches in the aforesaid two cases, even as a matter of first principle, we find no justification in the submission which has been urged on behalf of the Revenue. Section 70 prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ides that the provisions of subsection (8) and subsection (10) of Section 80IA shall, so far as may be, apply in relation to the undertaking referred to in the section as they apply for the purposes of an undertaking referred to in Section 80IA. Section 80IA contains a specific provision in subsection (5) to the following effect : (5) Notwithstanding anything contained in any other provision of this Act, the profits and gains of an eligible business to which the provisions of subsection (1)apply shall, for the purposes of determining the quantum of deduction under that subsection for the assessment year immediately succeeding the initial assessment year or any subsequent assessment year, be computed as if such eligible business were the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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