Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2014 (5) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (5) TMI 1063 - HIMACHAL PRADESH HIGH COURTRevision u/s 263 - MAT computation - Whether doubtful loans written off as bad debts and subsequently credited to the profit and loss account by way of contra-entry, could be deducted from the book profits under clause (i) of Explanation 1 to section 115JB , especially when such doubtful loans had not been included in the book profits of the relevant years for the purposes of section 115JA or 115 JB? - Held that:- It would be seen that it had not been disputed before the ITAT that the sum represents the provision for non-performing assets created earlier years, not out of reserve created before 1.4.1997. Therefore, the same had to be reduced for computation of book profit in accordance with section 115JB. The ITAT has come to categorical findings of fact that following provisions were available for credit to the profit and loss account, which had been made after 1.4.1997 and not prior to it.Therefore, in the given facts and circumstances, we have left with no option but to uphold the order passed by the ITAT. from the exposition of law, it can be safely concluded that the power of the Commissioner Income Tax to exercise suo motu revisional power in terms of Section 263(1) is in the nature of supervisory jurisdiction and the same can be exercised only if the circumstances specified therein viz “(i) the order is erroneous”; (ii) “by virtue of the erroneous order prejudice has been caused to the interest of the Revenue, however, every loss of revenue as a consequence of an order of Assessing Officer cannot be treated to be prejudicial to the interest of revenue. Both the conditions precedent for exercising the jurisdiction under section 263 of the Act are conjunctive and not disjunctive. The order of assessment passed by an Income Tax Officer, therefore, should not be interfered with only because another view is possible. The ITAT has correctly interpreted the provisions of section 115JB of the Act and thereafter applied the same to the facts of each case(s). - Decided in favour of assessee.
|