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TMI Blog2013 (6) TMI 472X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 115JB on the basis of judicial rulings which were in favour of assessee and, therefore, facts of the present cases are different from the facts and cases relied upon by = DR. No infirmity in the orders passed by the CIT (A). Therefore, the appeals filed by Revenue are dismissed. - ITA Nos.5313 & 5314/Del/2012 - - - Dated:- 24-5-2013 - U B S Bedi and T S Kapoor, JJ. For the Appellant : Shri R M Meet, Adv. For the Respondent : Mrs Y Kakkar, Sr.DR ORDER:- Per: T S Kapoor: These are two appeals filed by the Revenue against the order of the Commissioner of Income Tax (Appeals)-XIII, Laxmi Nagar, NEW DELHI both dated 06.08.2012 for the assessment years 2005-06 2006-07.Grounds of appeals has been take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er law as at the time of filing of return, there were a number of judgments in favour of assessee. It was submitted that based on several decisions on the issue, the assessee was not required to make adjustment in the amount of book profits in respect of provision for diminution in the value of any asset. However, with the amendment u/s 115JB in 2009 with retrospective effect from 1st April, 2001 this adjustment to the book profit was brought to statute. The AO on the one hand made adjustment in book profits in view of the amended provisions and also initiated penalty proceedings u/s 271 (1) (c) on account of furnishing inaccurate particulars and after that passed orders u/s 271 (1) (c) in respect of both years. 4. Dissatisfied with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rofit and loss account is an ascertained liability and, therefore, cannot be included in its book profit u/s 115JB. When the return of income was filed by the appellant, the retrospective amendment to section115JB regarding the claim bad debts was not on the statutes. The appellant claims that while filing the return of income based on various judicial pronouncements available on the subject, no wrong or malafide claim said to have been made by the appellant in the return of income. At the time of filing return of income no clear cut ruling in favour of such amendment was available, therefore, the appellant did not include the provision for doubtful debts in the book profit declared in the return of income. The appellant has also rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The facts of the appellant s case are similar to the above cited decision of Hon ble ITAT, Delhi, therefore, ratio of the above cited judicial pronouncement is squarely applicable to the case of appellant. Hence, penalty u/s271 (1) (c) of the IT Act cannot be levied for not including the provision for doubtful debts, doubtful advances and obsolescence stock in the book profit declared by the appellant. Accordingly, penalty levied of ₹ 17,40,483/- by the AO is cancelled. Similar findings were made in respect of assessment year 2006-07 except the change in figures. 5. Aggrieved, the Revenue is in appeal before us. At the outset the Ld. DR submitted that assessee had not actually written off as per the provisions of sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o section 32 and 36 for which there were different views taken by different benches. It was also argued that Ld. DR has taken new arguments which were not part of assessment order. In support of his contention and case, the Ld. AR relied upon the case laws of paper book dated 11th March, 2012 and in this respect page 33 and page 43 of paper book were read and it was contended that the cases of the assessee are squarely covered in its favour vide above judgments. Therefore, the appeals filed by the Revenue should be dismissed. 7. The Ld. DR in her rejoinder submitted that case laws relied upon by Ld. AR relates to section 115JA whereas, the appeals relate to the application of section 115JB. It was contended that provisions of Obsolete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose of section 115JB. Similarly in the case law of Sumer builders (P.) Ltd. Vs DCIT reported in 19 taxmann. com 43 (Mum.), the assessee had not credited capital gain to profit and loss account and had credited directly to capital reserve account and Hon ble Tribunal held that gain was part of profit and loss account for the purpose of provisions of section 115JB. The present cases relates to calculation of profits u/s 15JB wherein the assessee had excluded provisions for diminution in the value of assets from profits u/s 115JB on the basis of judicial rulings which were in favour of assessee and, therefore, facts of the present cases are different from the facts and cases relied upon by Ld. DR. 9. In view of the above, we do not s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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