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TMI Blog2019 (2) TMI 1439X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of Deputy Commissioner of Income Tax V. Beardsell Ltd. (2000 (3) TMI 37 - MADRAS HIGH COURT) considered the identical issue of whether a provision for doubtful debts was liable to be included in the computation of book profits under s.115JA HELD THAT:- The settled position in law as on date is that with effect from 01.04.1998 any amount set aside as provision for diminution in value of asset would be liable to be added back to the 'book profits' in terms of s.115JA of the Act. The substantial questions of law that arise for the respective Assessment Years are now answered bearing in mind the dates of the impugned orders. Rectification u/s 154 - Revenue did not have the benefit of the decision of this Court in Beardsell (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the provision for non-performing assets should not be reduced from the book profits computed under section 115JA of the Act? ii) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessing Officer had jurisdiction to rectify the intimation under section 143(1)(a) to disallow the provision for non-performing assets? 3. The facts in relation to both the appeals are common and as follows. Returns of income were filed in respect of assessment years 1997-98 and 2000-2001 and intimations under section 143(1)(a) of the Income Tax Act, 1961 (in short 'Act') were issued. Thereafter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nue. Thus, the position of law as on the date of passing of s.154 order would that a provision for non-performing assets was liable to be included in 'book profits' in terms of Explanation (c) to section 115JA of the Act. 6. The matter travelled in appeal before the Commissioner of Income Tax (Appeals) and thereafter to the Income Tax Appellate Tribunal and both the Appellate Authorities have confirmed the disallowance made by the Assessing Officer under s.154 of the Act. 7. The assessee, apart from challenging the addition on merits had also taken a point before the lower authorities to the effect that the addition ought not to have been made in terms of s.154 of the Act that specifically provides only for a rectification of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in the value of any asset, if any amount referred to in clauses (a) to (g) is debited to the profit and loss account, and as reduced by - ..........................' 11. Thus the settled position in law as on date is that with effect from 01.04.1998 any amount set aside as provision for diminution in value of asset would be liable to be added back to the 'book profits' in terms of s.115JA of the Act. 12. The substantial questions of law that arise for the respective Assessment Years are now answered bearing in mind the dates of the impugned orders. 13. In T.C.(A)No.1532 of 2008, the order under s.154 is dated 09.08.1999, whereas the decision of this Court in Beardsell (supra) is dated 14.3.2000. Thus the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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