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TMI Blog2015 (1) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... which as per A.O was irregular in view of the provisions of Section 2(43). He also noticed that the disallowance of Rs. 2,66,38,938/- made u/s. 14A during assessment was required to be added to the book profit u/s. 115JB as per Clause f below explanation 1 to Section 115JB which was not done. He was therefore of the view that Assessee's income has escaped assessment on account of aforesaid adjustments and accordingly a notice u/s. 148 of the Act was issued on 26.3.2010 and thereafter assessment was framed u/s. 143(3) r.w.s. 147 of the Act and the total book profits for the purpose of MAT was determined at Rs. 11,73,06,12,871/- as against the book profits of Rs. 11,70,37,53,788/- determined in original order of assessment. Aggrieved by the order of A.O, Assessee carried the matter before CIT(A) who vide order dated 30.12.2010 granted substantial relief to the Assessee. Aggrieved by the order of CIT(A), Revenue is now in appeal before us and has raised the following grounds:- 1The Ld. CIT(A)-XIV, Ahmedabad has erred in law and on facts in allowing the assessee's ground of appeal regarding the validity of re-opening of the assessment proceedings u/s. 147 and notice u/s. 148 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of Cliantha Research Ltd. vs. D.C.I.T (2013) 35 Taxman.com 61 (Guj). He thus supported the order of CIT(A). 6. We have heard the rival submissions and perused the material on record. We find that CIT(A) while holding that there was no income which has escaped assessment so as to issue notice u/s. 148 of the Act has given a finding that during the course of scrutiny, the aspect of computation of book profit have been analyzed and after due application of mind, the A.O had determined the figure of book profit for the purpose of computation of minimum alternative tax. He has further held that the reopening in the present case to be a case of change of opinion and therefore invalid. Before us no material has been placed on record to controvert the findings of CIT(A) and ld. A.R. We further find that Hon'ble Gujarat High Court in the case of Cliantha Research (supra) has held has under:- " Where during original assessment assessee's claim was processed at length and after calling for detailed explanation same was accepted, merely because a certain element or angle was not in mind of Assessing Officer while accepting such a claim, could not be a ground for issuing notice under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3(2) of the Act. The AO accepted-the contention of the-Appellant, however, he is of the view that unpaid-amount of Rs. 2,20,145/- in respect of FBT is unascertained liability and though it is not required to be added under clause (a), the same is required to be added under clause (c) of Explanation 1 to Section 115JB of the Act. The Appellant Company submits that it is well settled law that the AO cannot do indirectly which he cannot do directly. I hold that the issue is directly covered in favour of the appellant by the circular of the Board which inter alia held that Fringe Benefit Tax whether paid or payable or provision thereof is not required to be added back while computing book profit u/s 115JB of the Act Hence, this adjustment to the figure of book profit is held to be invalid and directed to be deleted. This ground of appeal is therefore, allowed. Even otherwise, the Appellant alternatively submitted that in any case merely because payment of FBT is lesser than the amount of provisions, it cannot be said that balance unpaid amount is unascertained or contingent liability which is required to be added under clause (c) of Explanation 1 to s. 115JB of the Act. The Appellant s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial on record. We find that CIT(A) while deleting the addition has interalia held that the issue of considering FBT for the purpose of MAT is directly covered in favour of the Assessee by the Circular of the Board dated 29.08.2005 which interalia holds that FBT whether or payable or provision thereof is not required to be added back while computing book profit u/s. 115JB of the Act. He has further given a finding that the liability of FBT having been crystallized and quantified in the books of account, the same cannot be treated as contingent liability and therefore cannot be added back to the amount of book profit. Before us, Revenue has not brought any material on record to controvert the findings of CIT(A). In view of the aforesaid facts, we find no reason to interfere with the order of CIT(A) and thus this ground of Revenue is dismissed. 3rd ground is with respect to directing the deletion of disallowance u/s 14A from being added to book profit. 13.A.O noticed that disallowance of Rs. 2,66,38,938/- was made u/s 14A while framing assessment u/s 143(3) and the disallowance made by A.O was also confirmed by CIT(A). A.O was of the view that the disallowance made u/s. 14A was re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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