IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE T.R.RAMACHANDRAN NAIR MONDAY, THE 11TH FEBRUARY 2008 / 22ND MAGHA 1929 ITR.No. 20 of 1997() -------------------- AGAINST THE ORDER DATED 21/10/1994 IN RA 318C/91 IN ITA.590/COCH/1988 of I.T.A.TRIBUNAL,COCHIN BENCH .................... APPLICANT: ----------- COMMISSIONER OF INCOME TAX, ERNAKULAM. BY ADV. SRI.GEORGE K. GEORGE, SC FOR IT SRI.P.K.R.MENON(SR.),SC FOR IT RESPONDENTS: ------------- THE KERALA SHIPPING CORPORATION LTD., COCHIN. BY ADV. SRI.K.P.DANDAPANI THIS TAX REFERENCE HAVING BEEN FINALLY HEARD ON 11/02/2008, ALONG WITH ITR NO. 21 OF 1997, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.N.RAMACHANDRAN NAIR & T.R.RAMACHANDRAN NAIR, JJ. .................................................................... I.T.R. Nos.20 & 21 of 1997 .................................................................... Dated this the 11th day of February, 2008. JUDGMENT C.N.Ramachandran Nair, J. In the reference application filed by the Department, notice sent by the Registry got returned with the endorsement that "not known". We find that notices sent on several occasions were returned with the same endorsement. The assessee appears to be a shipping company promoted by the Government of Kerala. The company became defunct after the only vessel it had drowned several years back. It is seen from the two assessment orders produced in this court that the assessee was sustaining heavy losses. The unabsorbed business loss, depreciation, S.80J benefits etc. allowed to be carried forward to subsequent years are in lakhs of rupees. The only issue raised in these cases is whether the tax paid by the assessee on foreign earnings were to be allowed as a deduction in the computation of income. While the case of the assessee is that only net income received from abroad is assessable, the department's case is tax paid abroad forms part of income and should also be added to the total income. We are of the view that the issue has become academic because even if decision goes in favour of the 2 Revenue, Revenue is not going to get single rupee towards tax as carried forward losses are enough to absorb any amount of income. The total amount involved in both the years together is less than Rs.3 lakhs and considering the eligible losses and depreciation available for set off against income and since the company is defunct, we feel pursuing the matter in this court by the Revenue is only waste of time for this court. We, therefore, decline to answer the questions referred. The I.T.Rs. are accordingly closed. A copy of this judgment under the seal of the High Court and signature of the Registrar shall be forwarded to the Income Tax Appellate Tribunal, Cochin Bench, Cochin. C.N.RAMACHANDRAN NAIR Judge T.R.RAMACHANDRAN NAIR Judge pms