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In the earlier law there was a provision that where there are no profits or gains made for an assessment year or where the deduction exceeds the profits and gains made, the whole or balance of the deduction is to be carried forward and set off against the profits and gains made for the next following assessment year and so on.

In the case of CIT v. Gujarat Agro Oil Enterprises (2001) 118TAX150 the assessee made no claim for deduction u/s 80J in the previous years in view of losses. The assessee claimed carry for ward of relief in the subsequent year of profits, which was denied by the assessing officer and the Commissioner (A).

The Tribunal took the view that when some relief is permissible under the law and if no specific claim is made, even then that should be allowed by the authorities concerned. The Gujarat High Court upheld the view of the Tribunal. Similarly the Madras High Court in the case of Commissioner of Income-tax Vs. Bluemount Ceramics Ltd. (1980) 123ITR385 held that unlike section 34(1) (erstwhile), there was no statutory obligation on the part of the assessee under section 80J to furnish the necessary particulars for claiming deduction in each of the year including the year of set up.

Also the Madras High Court in Commissioner of Income-tax vs. Premier Mills Ltd. (239ITR165) held that the assessee is entitled to all statutory deductions, which are admissible under the Act, and it is impermissible for the Income-tax Officer to curtail such statutory deductions or impose conditions of any sort.

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