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TMI Blog2009 (5) TMI 994X X X X Extracts X X X X X X X X Extracts X X X X ..... dran Nair, The question raised in the appeal filed by the assessee is whether the Tribunal was justified in holding that the assessee is not entitled to carry over depreciation loss from 2002-03 to 2003-04, the years of assessment under appeal in this case. The assessee is a 100 per cent export oriented unit (EOU) which enjoys tax exemption under s. 10B of the IT Act. The benefit of exemption ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the asst. yr. 2001-02. In any case while completing the assessment for 2002-03 the AO made an observation that unabsorbed depreciation is not available for carry forward or set off in the succeeding year which is the assessment under appeal in this case. The disallowance is seen made by the officer and confirmed by the Tribunal under s. 10B(6) of the Act. Learned senior counsel appearing for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot tenable because s. 10B(6) has no application for the asst. yr. 2003-04. The fact that unabsorbed depreciation carried over for several years is not allowable in the assessment year immediately following the end of the period of tax exemption does not mean that until such assessment year the assessee cannot carry forward unabsorbed depreciation or business loss. However by now the assessment for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation for the year 2003-04. Counsel for the appellant referred to the decision of the Supreme Court in CIT v. Manmohan Das [1966] 59 ITR 699 (SC) wherein the Supreme Court has held that eligibility for carry forward of unabsorbed depreciation is to be considered in the succeeding year. The AO is directed to follow the decision of the Supreme Court on this issue. The appeal is disposed of setting a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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