Finance Act 2016 amended Section 115BBE to provide that w.e.f AY 2017-18 set off of any loss shall not be allowed to the assessee under any provision of this Act in computing his income under section 68,69, 69A,69B,69C and 69D.

Recently Rajasthan High Court in case of Principal Commissioner of Income-tax v Aacharan Enterprises (P.) Ltd [2020] 117 taxmann.com 745(Rajasthan) has held that section 115BBE providing that no set off of any loss shall be allowed to assessee against deemed income under sections 68, 69, 69A to 69D could not be applied retrospectively.

As such set off of any loss shall not be allowed to the assessee under any provision of this Act in computing his income under section 68,69, 69A,69B,69C and 69D for AY 2017-18 and onwards and not for any assessment year before AY 2017-18.

While answering the question that whether amendment to section 115BBE regarding setoff is retrospective or prospective the Hon’ble court also relied on CDBT circular No 11/2019 dated 19/06/2019 wherein the CBDT has issued clarification that provision relating to not allowing setoff of any loss against income under section 68,69,69A,69B,69C and 69D shall apply for AY 2017-18 and onwards and shall not apply upto AY 2016-17.