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TMI Blog2020 (7) TMI 602X X X X Extracts X X X X X X X X Extracts X X X X ..... rovision of section 32(2) - AO has correctly held that business loss is not allowable to be carried forward and has allowed being unabsorbed depreciation to be carried forward. CIT (A) clearly referred to the provision of section 80 also The ld CIT (A) has also upheld the same view. - Decided against revenue. - ITA No. 504/Del/2017 - - - Dated:- 23-7-2020 - Ms. Sushma Chowla, Vice President And Shri Prashant Maharishi, Accountant Member For the Assessee : Mr. Nageshwar Rao, Adv For the Revenue : Ms. Pramita M. Biswas, CIT DR ORDER PER PRASHANT MAHARISHI, A. M. 1. This appeal is filed for AY 2012-13 by the ld Additional Commissioner of Income-tax, Special Range-6, New Delhi [ The Ld AO] against the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessee company has filed return of loss on 02.01.2013 and claimed carry forward of the same u/s 72 of the Act. The assessee was asked to justify the same. The assessee submitted that out of total loss of ₹ 73,56,15,769/-, ₹ 4,37,20,911/- is on account of unabsorbed depreciation and balance of ₹ 69,18,94,858/- is a business loss for the year. The assessee submitted that as return of income is filed late, business loss of ₹ 69,18,94,858/- cannot be carried forward to subsequent year. However, the unabsorbed deprecation of ₹ 4,37,20,911/- is allowable to be carried forward. The ld AO held that the assessee could not claim carry forward and set off loss u/s 72 of the Act. Therefore, he made an addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t . 3.2 In response to query raised, the AR of the assessee company has furnished the reply on 03.07.2014, which is summarized as under.- Show cause as to why loss claimed at ₹ 73,56,15,760/- claimed to be carried forward may not be rejected for carry forward because return is not tiled under section 139(1). As per the return of income filed for the subject AY. Nortel India has incurred tax loss of lNR 73,56,15,769 under normal provisions of the Act. Out of the aforesaid tax loss INR 4,37,20,911 is on account of unabsorbed depreciation and balance INR 69,18,94,858 pertains to business loss. As per section 139(3) of the Act, business loss of a particular year determined under section 72 of the Act is not allowed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss is INR 103,53,91,879 and as per point (x), total loss earned forward to future years is INR 99,80,81,888 (including loss of INR 24,88,69,227 carried forward from AY 2011-12. The amounts as per points (ix) and (x) have been automatically computed from other schedules of the return form in the return form utility and have not been specifically input by Nortel India while filling the return form. These amounts only represent the loss incurred by Nortel India and not the amounts available for carry forward after application of section 139(3) of the Act. Given the format of thee return form utility downloaded from the income tax website, Nortel India never had the option to separately show the portion of business loss which is not being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the A.O. and the submissions of the appellant. In view appellant s suo-moto not carrying forward the loss as per the provisions of Section 80 to the next year, the action of the A.O. only reiterates the suo-moto action of the appellant. Section 80 reads as under:- Notwithstanding anything contained in this Chapter, no loss which has not been determined in pursuance of a return filed [in accordance with the provisions of sub- section (3) of section 139], shall be carried forward and set off under sub-section (1) of section 72 or sub-section (2) of section 73 or sub-section (1) [or sub-section (3)]of section 74 [or sub-section (3) of section 74A]. 6.3. It is clear/ from the above that for late filing of Return the assessee is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it is the contention of the assessee also that the assessee is not entitled to carry forward of such losses. 9. We have carefully considered the rival contentions and perused the orders of the lower authorities. The facts are very clear that the assessee filed return on 02.01.2013, which is beyond the due date prescribed u/s 139(1) of the Act. In the return of income the assessee has declared loss of ₹ 73,56,15,769/- consisting of business loss for the year of ₹ 69,18,94,858/- and unabsorbed depreciation of ₹ 4,37,20,911/-. As per the provision of section 139(3) to carry forward business loss u/s 72(1), assessee should have filed its return of income in time allowed u/s 139(1) of the Act. However, the above condition ..... X X X X Extracts X X X X X X X X Extracts X X X X
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