RAMANUJAM J.

At the instance of the Revenue, the following common question of law has been referred to this court

"Whether, on the facts and in the circumstances of the case, the Appellate Tribunal's findings that for the purpose of computing the profits of the industrial undertaking under section 80J(1), the unabsorbed depreciation of the earlier years will have to be set off last after the determination of the current year's relief under section 80J is sustainable in law ?" *

The assessee is a co-operative society and the ITO computed its total income for the assessment year 1971-72, as follows

Rs Rs Rs

Interest on securities 2, 000

Business income before allowance of depreciation 11, 51, 247

Less : Depreciation for current year 5, 58, 678

Brought forward depreciation 6, 36, 173 11, 84, 860(sic) 412

33, 613 (sic) 2, 412

Balance depreciation to be carried forward 31, 201 Development rebate

Assessment years Rs

1967-68 7, 20, 405

1968-69 66, 559

1969-70 nil

1970-71 1, 16, 270

1971-72 27, 324

9, 30, 558

The assessee was entitled to deduction under s. 80J to the extent of Rs. 2, 81, 972 for the said assessment year. As the income computed was loss, the ITO held that the said sum of Rs. 2,