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2022 (10) TMI 564 - AT - Income TaxMAT computation u/s 115JB - assessee has received excise refund and interest subsidy which have been claimed as capital receipts - AO held that the scheme of Section 115JB does not permit for exclusion of capital receipts (excise refund and interest subsidy) as done by the assessee while computing the book profits for the purpose of Section 115JB - HELD THAT:- As in the case in hand the issue revolves around the capital receipts of the nature excise duty refund and interests subsidy which without any doubt are receipts of capital nature. Hon’ble Calcutta High Court in the case of Ankit Metal and Power Ltd. [2019 (7) TMI 878 - CALCUTTA HIGH COURT] was directly dealing with the question whether the incentives received from the Government for setting up power plant in the backward regions of West Bengal are to be included for the purpose of computation of book profits u/s 115JB and after taking into consideration the judgment of Hon’ble Supreme Court in Appollo Tyres Ltd. [2002 (5) TMI 5 - SUPREME COURT] observed that the income in question, in that case was taxable but was exempt under specific provision of the Act, as such it was to be included as a part of book profit. But since a receipt is not in the nature of income at all, it cannot be included in book profit for the purpose of computation u/s 115JB and accordingly held that interest in power subsidy under the scheme have to be excluded while computing book profits u/s 115JB. The Co-ordinate Bench in M/s. Insecticides (India) Ltd. [2022 (9) TMI 653 - ITAT DELHI] while dealing with question and treatment of capital receipts in computation of profit u/s 115JB had relied judgment of Hon’ble Calcutta High Court in Ankit Metal and Power Ltd. (supra) and Co-ordinate Bench decision in SRF Ltd. [2022 (2) TMI 758 - ITAT DELHI] ITAT Delhi judgment dated 07.02.2022, and had held that since the receipt is not in nature of income, then it cannot be considered in the book profits for the purpose of computation u/s 115JB of the Act. Thus held that Appellant company has rightly reduced Capital Receipts of the nature excise refund and interest subsidy for working out Book Profits. The appeal is allowed
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