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2016 (8) TMI 1385 - AT - Income TaxMAT - addition made to the book profit u/s. 115JB - Rectification of mistake u/s 154 - Assessee company has debited ₹ 1,94,00000 crores as provision for current tax whereas while working income under MAT provision had added only ₹ 4,18,968/- as income tax provision, therefore, he has made addition of ₹ 1,89,81,032/- as provision for income tax to the book profit - Held that - After perusal of the detail on record and the facts of the case, we observe that if provision of income tax of ₹ 1,94,00000/ is added for the purpose of calculation of book profit, then the amount credited to profit and loss account being MAT credit entitlement ₹ 1,93,69,003/ is to be reduced while calculating book profit as is mentioned in item no.(i) of explanation 1 to sec.115JB(2) of the act. It was also noticed that alternatively if the amount of profit before the tax is taken for calculating book profit u/s. 115JB of the act and no adjustment are made with respect to income tax then also the calculation of book profit. It is clearly demonstrated from the above facts that the assessee has debited income tax provision of ₹ 1.94,00000 crores against which it has claimed MAT credit of ₹ 1,93,69,003/- therefore, the difference of ₹ 30,997/- was added to the book profit. In the light of the above and after considering the detailed findings of CIT(A), we do not find any merit in the appeal of the assessee, therefore, the same is dismissed.
Issues:
Appeal against deletion of addition on account of provisions of Income Tax Act u/s. 115JB of the Act. Analysis: The Revenue's appeal for A.Y. 2012-13 challenged the deletion of an addition of ?1,89,81,032 made on account of provisions of the Income Tax Act u/s. 115JB of the Act by the CIT(A)-9, Ahmedabad. The case involved the interpretation of provisions related to book profit calculation under section 115JB of the Income Tax Act, 1961. The assessing officer had added income tax provision to the book profit, leading to a revised book profit amount. The CIT(A) deleted this addition after considering the explanation and provisions of the Act. The CIT(A) noted that the appellant had rightly reduced the MAT credit amount while calculating the book profit as per the provisions of the Act. The CIT(A) analyzed the relevant sections and explanations, concluding that the assessing officer was not justified in making the addition. The appellate tribunal carefully reviewed the facts and arguments presented by both parties. The tribunal observed that the provision of income tax should be adjusted as per the explanation to section 115JB(2) of the Act. The tribunal analyzed the calculations provided by the assessee and found that the difference in the income tax provision and MAT credit was correctly considered while determining the book profit. Consequently, the tribunal dismissed the appeal of the revenue, upholding the decision of the CIT(A) to delete the addition on account of provisions of the Income Tax Act while calculating the book profit under section 115JB of the Act. This judgment highlights the importance of correctly interpreting and applying the provisions of the Income Tax Act, especially concerning the calculation of book profit under section 115JB. It underscores the significance of adhering to the statutory requirements and explanations provided in the Act while determining tax liabilities. The case demonstrates the necessity for a thorough analysis of the facts and legal provisions to arrive at a just and accurate decision in matters of taxation.
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