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TMI Blog2012 (11) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of power through Windmills. For the assessment year 2007-08, the assessment was completed u/s 143(3) of the Income-tax Act, 1961 [hereinafter referred to as "the Act"] on a total income of Rs.66,67,980/- as against the returned loss of Rs.69,17,913/- The CIT, on perusal of assessment records found that the assessee has set off depreciation loss of Rs.2,52,84,000/- suffered from 'eligible business' of generation of power against the income from non-eligible business comprising of jewellery business and other residuary sources. Therefore, according to him, the order of the AO passed u/s 143(3) was erroneous and prejudicial to the interests of revenue and accordingly issued show cause notice to the assessee. After hearing the assessee's r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought to have appreciated that the assessing officer had examined the issue and had also obtained all the particulars form the appellant and having satisfied had allowed the claim of the appellant and in the circumstances it was not a case of nonapplication of mind to consider the decision of the assessing officer as erroneous to assume jurisdiction under section 263 of the Act and accordingly the order passed by him is liable to be cancelled. 7. The learned CIT ought to have considered the submissions of the appellant and refrained from setting aside the order of the assessing officer." 4. At the time of hearing, learned counsel for the assessee placed on record paper book containing pages 1 to 16. He also placed on record the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be set off first against the income of the subsequent years of eligible business while determining the profits eligible for deduction u/s. 80IA of the Act and set off of losses from other sources under the same head is not permissible. However, it should not be forgotten that section 80IA of the Act is a beneficial section permitting certain deductions in respect of certain income under Chapter VIA of the Act. A provision granting incentive for promotion of economic growth and development in taxing statutes should be liberally construed and restriction placed on it by way of exception, should be construed in a reasonable and purposive manner so as to advance the objects of the provision. It is a generally accepted principle that the deemin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh Court in ITA No.5050/2010 dated 27-5-2011. The Hon'ble jurisdictional High Court has followed the judgment of the Hon'ble Supreme Court in the case of Synco Industries Ltd. vs. Assessing officer(Income tax) & another reported in (2008) 299 ITR 444(SC). The relevant finding of the jurisdictional High Court is reproduced below: '5. The Supreme Court had an occasion to consider the same question in the case of Synco Industries Ltd. vs. Assessing Officer (Income Tax) and another reported in (2008) 299 ITR 444 (SC), and at para 13 it has been held as under: 13. The contention that under Section 80-I (6) the profits derived from one industrial undertaking cannot be set off against loss suffered from another and the profit is required to be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court finds that the non-obstante clause appearing in Section 80-I(6) of the Act, is applicable only to the quantum of deduction, whereas, the gross total income under Section 80B(5) which is also referred to in Section 80I(1) is required to be computed in the manner provided under the Act which presupposes that the gross total income shall be arrived at after adjusting the losses of the other division against the profits derived from an industrial undertaking. If the interpretation as suggested by the appellant is accepted it would almost render the provisions of Section 80A(2) of the Act nugatory and therefore the interpretation canvassed on behalf of the appellant cannot be accepted. It is true that under Section 80-I(6) for the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X
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