9911796707
TMI Blog1993 (7) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 91,822 only, as against ₹ 3,71,146 allowed by the Income-tax Officer in his assessment order ? 2. This reference relates to the income-tax assessment of the assessee-company for the previous year ending 31-3-1984 corresponding to the assessment year 1985-86. The assessment for the said year was originally completed by the ITO on 24-1-1986 under section 143(3) of the Act. In making the said assessment, the ITO computed the gross total income of the assessee-company before allowing any deduction under Chapter VIA of the said Act in the sum of ₹ 3,06,071. The only deduction to which the assessee-company was entitled to in the said year under Chapter VIA was in respect of export turnover under section 80HHC of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmined the amount to be carried forward under section 80VVA, read with section 80HHC, in the sum of ₹ 91,822 only and not ₹ 3,71,140 as indicated by the ITO in his said assessment order dated 24-1-1986. The assessee-company filed appeal to the Tribunal against the said order passed by the Commissioner, West Bengal-II, Calcutta, under section 263. The Tribunal upheld the view taken by the Commissioner by observing that having regard to the scheme of law and more particularly the provisions of section 80HHC, read with section 80A(2) and 80VVA, the amount to be carried forward on account of unabsorbed deduction under section 80HHC would be ₹ 91,822 only. This reference arises out of the aforesaid order of the Tribunal. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n reducing the total income of companies to nil or a negligible part of the income before the grant of this tax concessions. In other words, section 80VVA was inserted to place a restriction on certain deduction in the case of companies. This section provides that where, in the case of a company, the aggregate amount of deduction admissible under certain provisions of the Act as specified in sub-section (2) thereof, exceeds 70per cent of the amount of total income as computed before making any such deduction, i.e., the pre-incentive total income, the amount to be deducted under this provision will be restricted to 70 per cent of the total income as computed before making such deduction. For the purpose of the reference it may be convenient ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n admissible to the assessee under the said provision for that year or, if no such deduction is admissible to the assessee for that year, be deemed to be the deduction admissible to the assessee for that year, and so on for succeeding assessment years. Sub-section (1) of section 80VVA uses the expression 'the aggregate amount which, but for the provisions of this section would have been admissible as deduction for any assessment year under any one or more of the provisions of this Act specified in sub-section (2)'. In other words, before proceeding to apply section 80VVA one is required to find out, at the first instance, the aggregate amount of deduction which is admissible to an assessee for any assessment year under any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee-company in the said year in the sum of ₹ 91,822 as has already been computed by the ITO by his said assessment order dated 24-1-1986 passed under section 143(3). 6. The only dispute that is involved in this reference relates to the determination of the amount of unabsorbed deduction under section 80HHC which can be carried forward to the subsequent year having regard to the provisions of section 80VVA(4). The ITO deserved that the sum of ₹ 3,71,139 be directed to be carried forward. This sum of ₹ 3,71,139 was determined by the ITO by deduction of ₹ 2,14,250 from ₹ 5,85,389 being the gross amount of deduction computed by the ITO as admissible to the assessee under section 80HHC. It appears t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 071 in the said year not by virtue of the provisions of section 80VVA but by virtue of the provisions of section 80A(2). At this stage, when we apply the provisions of section 80VV(1) we find that the deduction under section 80HHC forming part of Chapter VIA was limited in the case of this assessee for the said year to 70 per cent of ₹ 3,06,071, that is to say, in the sum of ₹ 2,14,049 having regard to the provisions of sub-section (1) of section 80VVA. In other words, the balance sum of ₹ 91,882 (₹ 3,06,071 - ₹ 2,14,249) could not be allowed to the assessee-company under section 80HHC in the said year by virtue only of the restriction contained under sub-section (1) of section 80V VA and not by virtue of anyth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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