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TMI Blog2013 (2) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... on of the Hon'ble Jurisdictional High Court in the case of M/s Sri Velayudhasamy Spinning Mills [P] Ltd[2010 (3) TMI 860 - MADRAS HIGH COURT] the AO is directed to compute the profits u/s 80IA(5) of the Act as if such eligible business is the only sources of income of the assessee and only the losses of the years beginning from the initial Assessment Year are to be brought forward and not losses of earlier years which have been already set off against the income of the assessee. - Appeal of the Revenue is dismissed – Against the revenue. - I.T.A. Nos. 1774 & 1775/Mds/2011 - - - Dated:- 5-1-2012 - SHRI HARI OM MARATHA AND SHRI N.S. SAINI, JJ. Appellant by : Shri R.B. Naik, CIT, DR Respondent by : Shri T. Banusekar, C.A ORD ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness and not the year of claim of deduction. 4 The learned CIT(A) ought to have observed that the plain meaning of th word initial year means the year in which the manufacture or production or other activity begins. 5. The learned CIT(A) has erred in holding that the unabsorbed depreciation of the earlier years which had already been absorbed cannot be notionally carried forward and taken into consideration for computing deduction u/s 80IA of the Act. 6. The learned CIT(A) ought to have appreciated that as per provisions of section 80IA(5) the undertaking eligible for deduction u/s 80IA of the Act should be treated as only source of income for computing the quantum of deduction. 7. The learned CIT(A) should have observed that sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er authorities and the material available on record. The undisputed facts of the case are that the assessee is running spinning mill and also installed three wind mills, first in Assessment Year 2003-04, second in Assessment Year 2005-06 and the third in Assessment Year 2006-07. Although the year of commencement was Assessment Year 2003-04, the assessee opted Assessment Year 2007- 08 as initial Assessment Year for the purpose of claiming deduction u/s 80IA of the Act in respect of windmills. Initial loss from windmills was set off against profit of spinning mills division. The assessee did not claim deduction u/s 80IA of the Act during the years where the assessee suffered loss. The Assessing Officer held that the initial year should be tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the years beginning from the initial Assessment Year are to be brought forward and not losses of earlier years which have been already set off against the income of the assessee. This ground of appeal is allowed. 10. No specific error in the order of the ld. CIT(A) could be pointed out by the departmental representative. The ld. D.R. also could not file any material before us to show that the order of the Hon'ble High Court relying on which the ld. CIT(A) granted relief to the assessee was varied in appeal by the Hon'ble Supreme Court. We, therefore, do not find any good reasons to interfere with the order of the ld. CIT(A), which stands confirmed and the grounds of appeal taken by the Revenue are dismissed. 11. In the result, both ..... X X X X Extracts X X X X X X X X Extracts X X X X
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