Law: Income Tax Act, 1922

Section: 15BB,10,24(2)

(a) Income-tax Act (XI of 1922)---Ss. 15-BB, 10 & 24 (2)--interpretation of both the sect ions--Assessee is entitled to claim normal depreciation while computing their profit/ and gain. Section 15-BB, of the Income-tax Act, 1922 lays down that the Industrial undertaking which enjoys tax holiday as provided by section 15-BB shall for the purposes of computation of its profit and gain be governed by section 10 except those provisions applicability of which has been excluded. Section 10 (2) of the income-tax Act provides the method of computation of profit and gain and also the allowance to which an assessee is entitled while making such computation. However, certain provisions of section 10 have not been made applicable as specified in proviso to section 15-BB (4A) (C). Section '10 (2) (vi) provides for depreciation, which can be claimed and method of its calculation. It also provides for depreciation, which is normally allowed and such: further or additional depreciation, which can be claimed on fulfillment of certain specified conditions. Section 15-BB ,(4A) (c) restricts the applicability of section 10 (2) (vi) to the extent of only normal depreciation and not to the further additional depreciation. Paragraph 'a' of the proviso' to clause (vi) of subsection (2) of 'section 10 which relates to further depreciation in respect of building, has also not been made applicable. Applicability of clause (vii) of subsection (2) of section 10, has also been excluded. Assessee is therefore, entitled to claim normal depreciation while computing their profits and gains. (b) Income-tax Act (XI of 1922)-- ---Ss. 15-BB, 10 & 24 (2)--Assessee is entitled in carry forward unabsorbed amount of depreciation after the expiry of tax holiday period. The concepts of carrying forward the loss and the depreciation allowance are completely different from each other. The former is covered by section 2.4 (2) whileâ-ž the latter is governed by section 10- (2) (vi) proviso (b). The order in which they are to be absorbed is fixed by section 24 (2). Assessee is entitled to carry forward the unabsorbed amount of depreciation after the expiry of tax holiday period. The method of…

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