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2014 (1) TMI 941 - AT - Income TaxComputation of book profit u/s 115JB of the Act – Addition of provision for doubtful debts – Held that:- The word 'set aside' in clause (i) is followed by the word 'as' and not by the word 'to' as has been followed in clause (c) - When the amount is claimed or earmarked for meeting a certain future liability then the word 'set aside' in that context will mean that the amount earmarked 'to' the provision made for future liability - The amount is calculated on certain percentage basis and according to the age of the asset in question - It is the simple process of calculating the present value of the asset in comparison to its purchase value, taking into consideration the depreciation in its value with the use and passage of time - For this purpose, neither there can be any requirement of creating a fund, nor such type of fund can ever be required for its use at appropriate time. While interpreting a legal provision, a single word cannot be taken out to interpret the provision, rather the whole of the provision as well the inter correlation of words used therein is to be seen. When we read the entire clause (i) of Explanation 1 to Section 115JB, the simple meaning of the word 'set aside' used therein comes out with reference to the amounts as 'reduced, on account of diminution in the value of the asset - Decided against Assessee.
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