COMMISSIONER OF INCOME-TAX, MADRAS vs S. S. SIVAN PILLAI AND OTHERS

The Supreme Court ruled that under Section 10(2)(vi) of the Indian Income-tax Act, 1922, unabsorbed depreciation from previous years must be included in the computation of profits for the current assessment year. The Court held that the High Court's view, which ignored unabsorbed depreciation in calculating profits, was inconsistent with the Act's provisions. Furthermore, the right to claim exemption under Section 15-C(4) is contingent upon the company having taxable profits, which was not the case here, leading to the dismissal of the Revenue's appeal.