The assessee was engaged in the business of manufacturing of textile garments. It filed return for relevant year, declaring total income at Rs. Nil.

The AO held that  as the business was discontinued  the  assessee was not entitle to set-off against the brought forward business losses of the earlier years. CIT (A) allowed the claim of the assessee. Tribunal affirmed the order of the CIT (A) by holding that   S. 72(1)(i) does not mandate that business or profession should have been carried on by assessee during relevant previous year as a pre-condition for set off of brought forward business losses and, therefore, in case there are profits and gains of any business or profession carried on by assessee, which are assessable in its hands during relevant year, it would be entitled to set off its brought forward business losses against same.  Referred CT v. Jaipuria China Clay Mines (P) Ltd. (1966) 59 ITR 555 (SC)  (AY. 2011-12)