9911796707
TMI Blog1990 (8) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee-company suffered loss in the new industrial undertaking and consequently in disallowing the assessee's claim for carry forward of the deficiency for the assessment year 1976-77 ?" Shortly stated, the facts are that the assessee claimed relief under section 80J for Unit No. 2 which had commenced production in the year under reference. The Income-tax Officer allowed the said deduction under section 80J although the industrial undertaking suffered loss. The assessee preferred an appeal before the Commissioner of Incometax (Appeals) against the several determinations made by the Income-tax Officer in the order of assessment. The Commissioner of Income-tax (Appeals) was of the view that since deduction under section 80J(1) of the Act c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... strial undertaking. The Tribunal held that the section makes provision for two contingencies only and not for the third contingency. We are unable to accept the reasoning of the Tribunal. We have examined the provisions in the Finance (No. 2) Bill, 1967, by which section 80J was sought to be introduced by deleting section 84. Section 80J was enacted differently from the provision in the Bill. The Finance (No. 2) Bill, 1967, as well as the Notes on Clauses do not show that it was the intention of the Legislature not to allow carry forward of the deficiency when the industrial undertaking suffered loss. Section 80J(3) contemplates that, even though the undertaking may not have earned profits and gains, yet the claim for the deduction of re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 80J is the amount by which the profits and gains derived by an assessee from the eligible undertaking and included in its gross total income for any assessment year within the "tax holiday" period falls short of the amount calculated at six per cent. per annum on the capital employed in the eligible undertaking during the previous year relevant to that assessment year. Where there are no profits and gains, or where there is a loss for any such assessment year, the deficiency in relation to that assessment year is to be taken to be an amount calculated at six per cent. per annum on the capital employed in the undertaking during the relevant previous year. We may add that, in paragraph 7 of Circular No. 5-P, dated October 9, 1967, issue ..... X X X X Extracts X X X X X X X X Extracts X X X X
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