AJIT KUMAR SENGUPTA, J.

( 1 ) IN this reference under Section 256 (1) of the Income-tax Act, 1961, for the assessment year 1970-71, the following question of law has been referred by the Tribunal : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in view of Section 80a (2) of the Income-tax Act, 1961, the assessee was not entitled to any relief under Section 80-1 ? "

( 2 ) THE assessee claimed relief under Section 80-1 on its profits as a priority industry. The Income-tax Officer, however, did not allow the relief. The Appellate Assistant Commissioner directed the Income-tax Officer to allow relief under Section 80-1 on the gross total income before setting off the carried forward losses and development rebate. Against the said order, the Department went in appeal before the Tribunal. The Tribunal held that the assessee is entitled to the benefit of Section 80-1 deduction on its profits as a priority industry before the set-off of the carried forward losses and development rebate. The Tribunal, however, held that Section 80a (2) provides for a limit to the extent to which reliefs under Chapter VI-A can be allowed to the assessee

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