Foreseeable losses computed as per Accounting Standard -7 are allowable

The contention of the assessee regarding allowability of foreseeable loss is accepted in principle, However, the issue is restored to the file of AO for the purpose of quantification and calculation of the said loss in terms of Accounting Standard -7, as the same has not been done. Deduction under Chapter VI A are to be allowed only on net income and not on gross income. The net income is to be computed after giving full effect to the provisions of sections 80AB, 32, 70, 71 & 72 of the Act. Therefore, the assessee is entitled to claim deduction under Chapter VIA of the Act after determinat...