Sunjewels Private Limited Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that depreciation of amalgamating company cannot be disallowed merely for non-filing of Form No. 62 which is only directory. Thus, non-compliance of the same would not disentitle the assessee to claim carry forward losses to be set off. Accordingly, appeal allowed.
Facts- The assessee has challenged CIT(A)’s order in not allowing set off of Rs. 2,52,04,161/- being brought forward business loss and unabsorbed depreciation of the amalgamating company on the grounds that the assessee has failed to fulfill the conditions prescribed u/s. 72A(2)(b)(iii) of the Act r.w.r. 9C of the Income Tax Rules, 1962. The assessee has also challenged the disallowance of Rs. 4,26,863/- being 10% of the purchases made from alleged accommodation entry providers viz. M/s. Arihant Exports and M/s. Adi Impex.
Conclusion- Hon’ble High Court of Madras in the case of Lotte India Corporation Ltd. has held that when the amalgamated company has achieved 100% of the installed capacity of production and has complied with the other conditions then filing of form 62 which is only directory and the non-compliance of the same would not disentitle the assessee to claim carry forward losses to be set off.
Held that the assessee’s claim cannot be disallowed merely for non-filing of the form no. 62. Pertinently, neither the ld. AO nor the ld. CIT(A) has specified about the desired installed capacity and the assessee has also not brought the exact figures before us to show that it had crossed the mandatory 50% installed capacity within the specified time limit. We therefore are of the considered view that this issue is to be remanded back to the ld. AO to allow the claim of the assessee after satisfying that the assessee has fulfilled all the conditions prescribed u/s. 72A r.w.r. 9C of the IT Rule, 1962.
