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TMI Blog2019 (3) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal was justified in rejecting the claim of the Appellant for set off of unabsorbed depreciation of Rs. 8,64,32,599/carried forward from the earlier year while computing the income under section 44BB of the Act? (2) Whether on the facts and in the circumstances of the case and in law, the Tribunal was justified in restoring the issue of set off of claim of unabsorbed business loss in computing the income under section 44BB of the Act, after accepting all the contentions of the Appellant and rejecting the findings of the lower authorities?" 2. Brief facts are as under: (i) Appellant-Assessee is a partnership firm, incorporated in the Netherlands and is engaged in the business of providing services and facilities in connection wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee's contention of permissibility of set-off of carried forward business loss of earlier years, the Tribunal accepted the assessee's stand. The Tribunal merely remanded the issue of computation of the assessee's income on such basis. Under the circumstances, we see no reason to interfere with the directions of the Tribunal, in this respect. 4. Question (1) relates to the assessee's claim of set-off of carried forward depreciation of the earlier years against the business income of the current year. In this regard, the Tribunal referred to the provisions contained in Section 44BB of the Act and held that, the computation provided therein, would override the provisions of Section 32 of the Act and in particular, su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia Steam Navigation Co. Ltd., v/s. The Commissioner of Income Tax 107 CTR 278. 7. On the other hand, learned Counsel for the Revenue opposed the appeal, contending that, Section 44BB of the Act is clear and permits no ambiguity. The Tribunal has, therefore, correctly rejected the assessee's ground. The appeal is devoid of merit. 8. Having heard the learned Counsel for the parties and having perused the documents on record, we notice that, Section 44BB of the Act makes special provisions for computing profit and gains of shipping business in case of nonresidents. Section 44BB reads as under: "44BB:(1) Notwithstanding anything to the contrary contained in sections 28 to 41 and sections 43 and 43A, in the case of an assessee [being a n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee may claim lower profits and gains than the profits and gains specified in that sub-section, if he keeps and maintains such books of account and other documents as required under sub-section (2) of section 44AA and gets his accounts audited and furnishes a report of such audit as required under section 44AB, and thereupon the Assessing Officer shall proceed to make an assessment of the total income or loss of the assessee under sub-section (3) of section 143 and determine the sum payable by, or refundable to the assessee." 9. Sub-section 1 of Section 44BB provides that notwithstanding anything to the contrary contained in Sections 28 to 41 and Section 43 and 43A of the Act in case of an assessee being a nonresident, engaged in the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (3) of Section 44BB of the Act, the assessee can opt out of the formula provided in sub-section (1) as long as he maintains books of account as provided under sub-section (2) of Section 44AA of the Act and gets such accounts audited. 10 In this view of the matter, we see provisions of sub-section (1) of Sections 44BB of the Act, is giving qualified benefit to the assessee. In a given case, assessee may as well consider that, not being governed by sub-section (1) of Section 44BB of the Act, may be more advantageous and he may, therefore, follow the option available under Section (3) of Section 44BB of the Act, since the profits and gains earned out of the business, is likely to be lower than computation as provided under sub-sect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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