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2014 (2) TMI 1246 - AT - Income TaxValidity of reopening of the assessment - Held that:- In the instant case, we have already noticed that the return of income has been processed only u/s 143(1) of the Act. Hence, in our view, the decision rendered by Hon’ble Supreme Court in the case of Rajesh Jhaveri Stock Brokers (2007 (5) TMI 197 - SUPREME Court ) squarely applies in the instant case. The Ld A.R placed reliance on the decision of Co-ordinate Mumbai bench in the case of Aipitia Marketing (P) Ltd [ 2007 (8) TMI 488 - ITAT MUMBAI] to contend that the re-opening of assessment is not valid, even if the return had been processed u/s 143(1) of the Ace, if there is no fresh material before the AO. In our view, the said decision is not applicable in the instant case, since the reassessment is warranted due to the retrospective amendment brought in the Act. Hence, we do not find any infirmity in the decision of the ld CIT(A) in upholding the reopening of the assessment. Accordingly, we uphold his order on this issue. MAT computation - Addition of “Provision for bad and doubtful debts” in computing the “Book Profit” - Held that:- In the instant case, we are concerned with the provisions of sec. 115JB, wherein the book profit is required to be computed from the audited accounts prepared under the provisions of the Companies Act. Under the accounting principles, on the basis of which the accounts are prepared under the Companies Act, the terms “Bad debts” and the “Provision for bad and doubtful debts” have distinct meaning and has got different accounting treatment. Hence, in our view, the decision rendered by Hon’ble Supreme Court in the case of Vijaya Bank (2010 (4) TMI 46 - SUPREME COURT ) under the normal provisions of Income tax Act, cannot be applied to the provisions of sec. 115JB of the Act. We notice that the Co-ordinate bench in the case of Tainwala Chemicals & Plastics India Ltd. [2011 (4) TMI 840 - ITAT MUMBAI ] , did not consider the applicability of the Companies Act to the book profit computed under sec. 115JB Act. In view of the foregoing, in our view, the Ld CIT was justified in upholding the addition of “Provision for bad and doubtful debts” to the book profit. Computation of interest u/s 234B and 234C - Held that:- We set aside the order of Ld CIT(A) on this issue and restore the same to the file of the AO with the direction to compute the interest u/s 234B and 234C of the Act by excluding the addition relating to “Provision for bad and doubtful debts” from the amount of book profit.
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