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2012 (4) TMI 395 - AT - Income TaxMAT - Addition made by the AO u/s. 115JB - capital gain have not been routed through profit & loss account - held that:- the Act has recognised that there may be cases where F.Y of the company may be different from the previous year and if the financial accounts are adopted in the previous year then such accounts must have similar Accounting Policies and Accounting Standard etc. - Now, who is going to check this aspect? Obviously, the Registrar of Companies is not concerned with these aspects whether accounts adopted for the previous year are same or not because the Registrar of Companies at best is concerned whether the accounts adopted and laid before the annual general meeting are in accordance with the requirements of Part II and Part III of Schedule VI of the Companies Act, 1956. Therefore, in view of these enlarged requirements, we are of the view that AO has powers to go behind the accounts and see whether same have been prepared in accordance with the requirements of Part II and Part III of Schedule VI of the Companies Act, 1956. Atleast u/s.115JB AO has power to go behind the accounts. - it is clear that book profits have to include the profits earned from capital gains. - assessee had earned certain profit on sale of shares and some industrial units which admittedly have not been credited to the profit & loss account which is contrary to the significant accounting policy of the assessee itself as well as against the requirements of Accounting Standard AS-13 and requirements of Part II and Part III of Schedule VI of the Companies Act, 1956. Therefore, in our opinion, AO has rightly brought these items to taxation under the MAT provisions of sec. 115JB. - Decided against the assessee.
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