Income Tax Act, 1961

--Deduction under section 10B--100 per cent export oriented undertakings Set-off of unabsorbed depreciation of other undertaking against profits of such undertaking--Assessing authority allowed the deduction under section 10B on the business income without setting off of unabsorbed depreciation. Commissioner was of the view that the same resulted in excess deduction allowed under section 10B and incorrect determination of loss was carried forward, therefore, he directed assessing officer to recompute the total income after setting off the unabsorbed depreciation and correctly determine the deduction allowable under section 10B. Held: Not rightly so, as assessing officer had adopted one of the permissible views and more so, in Malabar Industrial Co. Ltd. v. CIT 2000 TaxPub(DT) 1227 (SC): (2000) 243 ITR 83 (SC), it was held that deduction under section 10A had to excluded from the total income of the assessee, therefore, the question of unabsorbed business loss, being set-off against such profits and gains of the undertaking, would not arise. Therefore, following the above decision, no substantial question of law arose for consideration.

Income Tax Act, 1961, Section 10B

In the Karnataka High Court

N. Kumar & B. Manohar J.J.

CIT & Anr. v. Cheslind Textiles Ltd.

ITA No. 361 of 2009

4 March, 2013