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TMI Blog2018 (12) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, there is no dispute about the dates of commissioning of the windmills under consideration and Initial Assessment Year in which the deduction u/s 80lA of the Act was claimed by the assessee in respect of these Windmills, considering the fact that the Appellant's case is squarely covered by the above decisions of Hon'ble Madras High Court and Mumbai ITAT, it is held that the assessee had the option to opt for the 'Initial assessment year' for claiming deduction u/s 80IA and hence, loss or depreciation in the year earlier to 'initial assessment year' already absorbed against the profit of other business could not be notionally brought forward and set off against the profits of the eligible of the assessee. The Ground is accordingly Allowed. See HERCULES HOISTS LTD. [2015 (5) TMI 825 - BOMBAY HIGH COURT] - Decided against revenue. - ITA No. 4147/Mum/2017 - - - Dated:- 7-12-2018 - SRI MAHAVIR SINGH, JM AND SRI RAJESH KUMAR, AM For The Appellant : Shri Sachhidanand Dube, DR For The Respondent : Shri Mahaveer Jain, AR ORDER PER MAHAVIR SINGH, JM: This appeal by the Revenue is arising out of the order of Commissioner of Income Tax (Appeals)-39, Mumb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating the profit for the year under consideration. The AO required the assessee as to why the losses be not considered while calculating the profit for the year under consideration. The assessee replied that section 80IA of the Act as enacted by the Finance Act, 1999 with effect from 1st April, 2000 gives an option to the assessee with effect from 1st April, 2000 to claim relief under this section for any 10 consecutive assessment years out of 15 years beginning from the year ending in which the undertaking or enterprise develops or begins to operate any infrastructure facility etc. Once the assessee has opted for the first year of relief then it continues for further 9 consecutive years. The section mandates that the year in which the relief is claimed under this section for the first time is called as the initial assessment year. This will be the year in which the undertaking has to be treated as a separate sole source of income within meaning of s.80IA(5) of the Act and, therefore, depreciation and loss of earlier years cannot be notionally carried forward to be set off against income of the initial assessment year for computing deduction under section 80IA of the Act. The AO ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -IA has the option to choose the initial/first year from which it may desire the claim of deduction for ten consecutive years, out of a slob of fifteen (or twenty) years, as prescribed under that sub-section. It is hereby clarified that once such initial assessment year has been opted for by the assessee, he shall be entitled to claim deduction u/s 80-IA for ten consecutive years beginning from the year in respect of which he has exercised such option subject to the fulfillment of conditions prescribed in the section. 5.2 Further, it is found that the issue is covered in the favour of the assessee vide decision of Hon'ble Madras High Court in the case of Velayudhaswamy Spinning Mills (F') Ltd. vs. ACF (supra) relied upon by the assessee wherein the Hon'ble High Court has also considered the decision of the special bench of Hon'ble Ahmedabad Tribunal in the case of ITAT vs Goldmine Shares and Finance Pvt., relied upon by the Id. AO. In this case, it was held by the Hon'ble Madras High Court that as per sub-s. (5) of s. 80-IA, profits are to be computed as if such eligible business is the only source of income of the assessee and When the assessee exercises ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e determination is to be made which in any case shall not transgress beyond fifteen years from the year when Jojobera 67.5 MW power generating unit started generating power. We also hold that the notionally brought forward losses/ depreciation of the Jojobera 67.5 MW power generating unit for the period from the assessment year 1997-98 to 2001-02 which are already set off against the other business income in earlier years and set-off being allowed by the Revenue shall not be adjusted from the profit so computed by the assessee company with respect to Jojobera 67.5MW power generating unit for the assessment year 2002-03 for the purposes of computing deduction u1s.801A of the Act. 5.3 In this case, since, there is no dispute about the dates of commissioning of the windmills under consideration and Initial Assessment Year in which the deduction u/s 80lA of the Act was claimed by the assessee in respect of these Windmills, considering the fact that the Appellant's case is squarely covered by the above decisions of Hon'ble Madras High Court and Mumbai ITAT, it is held that the assessee had the option to opt for the 'Initial assessment year' for claiming deduction u ..... 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