- (1.) THE Tribunal, New Delhi, has referred to following question of law under s. 256(2) of the IT Act, 1961 (hereinafter referred to as 'the Act') for opinion of this Court : "Was the Tribunal on facts and circumstances of the case justified in law in holding that rectification for correctly computing the relief under s. 80HHA r/w s. 80A(2) was not a mistake apparent from record rectifiable under s. 154 -
(2.) THE present reference relates to the asst. yrs. 1984 -85 and 1985 -86.
(3.) BRIEFLY stated the facts giving rise to the present reference are as follows : Respondent/assessee is a private limited company. Assessment under s. 143(3) of the Act. IT Act was framed by the AO brought for the two assessment years determining its losses at Rs. 17,10,808 and Rs. 15,84,711, respectively. Subsequently, the assessing authority initiated proceedings under s. 154 of the Act on the ground that deductions under s. 80HHA for the asst. yr. 1984 -85 and under ss. 80HHA and 80J for the asst. yr. 1985 -86 have been wrongly allowed as the final assessment accounted (sic) in net loss. After affording opportunity of hearing to the respondents he withdrew the deductions allowed under the aforesaid sections. Feeling aggrieved, the respondent preferred separate appeal before the CIT(A), who did not approve the order of the AO and had held that the deductions allowed under ss. 80HHA and 80J of the Act could not be withdrawn under s. 154 of the Act which order has been upheld by the Tribunal. We have heard Sri Shambhu Chopra, learned standing counsel for the Revenue and Sri R.R. Agrawal, learned counsel appearing for the respondent. Learned standing counsel submitted that under Chapter VI -A of the Act under ss. 80HHA and 80J of the Act deduction is permissible from the gross total income of the assessee and as in the present case there was a loss determined in respect of the two assessment years deductions under ss. 80HHA and 80J of the Act were not admissible. The submission is misconceived. From perusal of the assessment order for the asst. yr. 1984 -85, we find that the profit after deducting the depreciation amounted to Rs. 20,27,679 which was the net income of that year. Similarly for the asst. yr. 1985 -86 net profit after depreciation has been worked out at Rs. 2,88,533. As in each of the two assessment years, there was a net profit prior to deductions under the aforementioned provisions for the asst. yrs. 1984 -85 and 1985 -86 has rightly been allowed.;