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TMI Blog2010 (1) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... of 2005, dt. 29th Aug., 2005 [(2005) 197 CTR (St) 85] speaks of amount of FBT paid and not of provision for FBT. 2. On the facts and in the circumstances of the case, learned CIT(A) has erred in admitting additional ground of appeal that "the assessee has erred in not reducing the amount of Rs. 24,33,000 on account of provision of FBT for the purpose of calculation of book profit under s. 115JB of IT Act, 1961 ignoring the fact that the assessee itself has added back the amount of Rs. 77,62,939 on account for tax which included an amount of Rs. 24,33,000 attributable to provision for FBT for the purpose of calculating book profit under s. 115JB of IT Act, 1961. 3. On the facts and in the circumstances of the case, the learned CIT(A) has e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this additional ground of the assessee in the light of Board Circular No. 8 of 2005, dt. 29th Aug., 2005 as per which FBT debited to P&L a/c cannot be added to book profit. Against this, the Revenue is in appeal before us. 4. It was the first submission of learned Departmental Representative of the Revenue that since no addition was made by the AO in the book profit on account of FBT provision of Rs. 24.33 lakhs and the same is as per return of income filed by the assessee and duly supported by the report of the chartered accountant in Form No. 29B, learned CIT(A) was not justified in admitting this additional ground raised before him. 5. The second submission of the learned Departmental Representative of the Revenue is that the language ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e powers of the AAC observed that an appellate authority has all the powers which the original authority may have in deciding the question before it subject to the restrictions or limitations, if any, prescribed by the statutory provisions. In the absence of any statutory provision, the appellate authority is vested with all the plenary powers which the subordinate authority may have in the matter. There is no good reason to justify curtailment of the power of the AAC in entertaining an additional ground raised by the assessee in seeking modification of the order of assessment passed by the ITO. This Court further observed that there may be several factors justifying the raising of a new plea in an appeal and each case has to be considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escribed by the statutory provisions. In the present case, learned CIT(A) has admitted the additional ground after making this observation that the additional ground is being admitted in the interest of justice. In the light of this judgment of Hon'ble apex Court, we feel that learned CIT(A) has properly admitted the additional ground raised by the assessee and hence we reject the ground No. 2 raised by the Revenue before us. 9. Now, we decide the issue on merit. For this purpose the provisions of Explanation to s. 115JB are relevant and hence we reproduce the same hereinbelow: "Explanation: For the purposes of this section, "book profit" means the net profit as shown in the P&L a/c for the relevant previous year prepared under sub-s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and any subsequent assessment year includes the FBT payable under s. 115WA." 11. From the definition of the term "tax", we find that the term "tax" is a wider term than the term "income-tax". The term "tax" includes "income-tax" as well as "FBT". By the Finance Act, 2005 w.e.f. 1st April, 2006, there is an amendment in s. 2(43) and in the definition of "tax", in addition to "income-tax" and "super tax" chargeable under the provisions of IT Act, 1961 "FBT" was also added payable under s. 115WA of the IT Act, 1961. This definition of the term "tax" proves beyond doubt that the term "tax" includes both "income-tax" as well as "FBT" and hence the term "income-tax" cannot include the term "FBT". When there was amendment made in s. 2(43) by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5JB. Board's circular relied upon and followed by the learned CIT(A) is in line with this decision of us without taking any help from Board circular. 12. In the light of above discussion regarding statutory provision on this issue, now we examine the contentions raised by the learned Departmental Representative of the Revenue that when the language of the section is clear, no reference is required to Explanatory Note or Board's circular. We are of the considered opinion that this contention of the learned Departmental Representative of the Revenue docs not have any relevance in the present case because we have seen that in the present case, the provisions of Expln. 1 to s. 115JB are clear and as per these provisions, payment or pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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