Set off and carry forward of losses are completely different

Chapter VI of the Income Tax Act contains provisions related to set off and carry forward of losses, though it comes a legal twist, which makes it ambiguous on a layman’s part to understand whether set off and carry forward of losses are completely different.
Chapter VI opines that set off implies current year’s expenses set off against current year incomes.Occurrence of Carry forward of Losses happen when current year profits are not sufficient to cover the current year expenses or the company/LLP is into losses since inception.Therefore , the losses which generated on account of non set off with that year’s profit or in a case where no profits generated at all will be carried forward to the next year and set off in the next year’s profit.

However, Section 80 of the Income Tax Act overrides chapter VI and captures that losses can be carried forward only if the return has been filed. This return can be a belated return also. Where a person has not submitted his return of income within the due dates prescribed by the Income Tax Act , he can still file the return of income which is called as Belated or Late Return. Belated Return can be filed at any time within one year from the end of the relevant assessment year or before the completion of the assessment , whichever is earlier.
However unabsorbed depreciation can be carried forward even if no return has been filed by the assessee.
Let us put this discussion in an illustration and understand it better :
Financial Year: 2011-2012
Thus, Relevant Assessment Year: 2012-2013
Therefore, the normal return filing date in case of assesses will be as per the article named Income Tax Return is mandatory for all Companies and LLPs
If an assessee fails to file return as per the above mentioned link u/s 139(1) of the Income Tax Act then he can file his belated return within 31-03-2014.
Belated Return can be filed with penalty or without penalty as the case may be-
If Belated Return is filed within 31-03-2013 then without penalty it can be filed.
If Belated Return is filed after 31-03-2013 and within 31-03-2014 then with penalty it can be filed.
Hence, it is very evident from the aforesaid analysis, that set off and carry forward of losses are completely different. So without wasting your time please utilize the opportunity of filing your return to get the benefit of Loss carry forward by 30th Sept, 2013 for AY 2013-14. After the prescribed date of Original Return, though you can file the tax returns, the carry forward benefit will be lost forever. We suggest you to file your company’s / LLP’s income tax return in time and avail the benefit of reducing your taxable profits in the succeeding years