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Filing of Form No.62 for Third Assessment Year is not required to allow Assessee to carry forward Losses: Madras HC [Read Judgment]

Lotte India - Madras High Court - Form No.62 - Assessment Year - Carry Forward Losses - Taxscan

The Madras High Court held that the non-filing of prescribed Form No.62 for the third Assessment Year is not required to allow the Assessee to carry forward losses under Section 72A of the Income TaxAct, 1961.

The Revenue has filed the appeal under Section 260A of the Act for the assessment year 2006-07 against the order of the learned Income Tax Appellate Tribunal “A” Bench, whereby the Tribunal allowed the benefit of carrying forward of losses under Section 72(A) of the Act to the respondent Assessee, M/s. Lotte India Corporation Ltd. which is the amalgamated company in respect of the brought forward losses of the amalgamating company in relation to M/s.Confectionary Specialties Limited (CSL).

The revenue sought the answer on the issue that whether on the facts and circumstances of the case the Appellate Tribunal is correct in law in holding that Unabsorbed depreciation relating to the assessment year 2001-02 and assessment years prior thereto can be set off in subsequent years, without any limit, as per the amended provision of section 32[2] of the Income Tax Act.

The other issue raised was whether the Tribunal was correct in deleting the disallowance on the claim of setting off of brought forward unabsorbed depreciation amounting to Rs.l,19,02,780/- pertaining to Assessment Years 1999-2000 and 2000-2001.

The division bench of Justice Vineet Kothari and Justice Krishnan Ramaswamy observed that the non-filing of prescribed Form No.62 for the third Assessment Year, after amalgamation, namely Assessment Year 2006-07, is not relevant, because the mark of 50% of installed capacity of production can be achieved at any point of time within four years after the date of the merger.

“Condition of filing the Form No.62, at best, is only directory and noncompliance thereof would not disentitle the Assessee to claim such carry forward losses to be set off against the profits of the Assessee company,” the bench said.

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