Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (10) TMI 625 - AT - Income TaxAdjustment of Bad Debts & diminution in value of investments from computation of book profits u/s 115JA - Held that:- We find that Section 115JA of the Act is a special provision introduced to the Income Tax Act by the Finance (No.2) Act, 1996 w.e.f. 01/04/1997 and as per subsection (1) of the said provision, in the case of a company whose total income computed under the Act is less than 30% of its book profits, then the total income chargeable to tax in the relevant previous year shall be deemed to be an amount equal to 30% of such book profit. Sub-section (2) of the said provision provides that the company referred to in subsection (1) of Section 115JA must prepare a profit & Loss Account in accordance with the provisions of Parts II and Part III of the Schedule VI of the Companies Act, 1956. The ITAT Mumbai benches in the case of Krung Thai Bank PCL Vs. JCIT [2010 (9) TMI 18 - ITAT, MUMBAI] have held that the provisions contained in Section 115JB, which in other words is also known as Minimum Alternative Tax [MAT] provisions, are not applicable to banking companies since they are not required to prepare a Profit & Loss Account in accordance with the provisions of Parts II and Part III of the Schedule VI of the Companies Act, 1956. We hold that since the provisions of Section 115JA are not applicable to the assessee. No additional interest has been computed u/s 234D in reassessment proceedings and the same did not arise out of reassessment proceedings. Sale of shares - treated as capital gain and not as business income chargeable to tax u/s. 28 - Held that:- We find that the assessee is consistently following such classification and treatment of income from investment since past many years. The revenue has nowhere disputed that permanent investment were carried at cost price. Further, upon perusal of the order of Ld. CIT(A) for AY 2002-03, we find that the same issue arose in that year also and Ld. CIT(A) upheld the stand of the assessee and concluded that the income from investment was rightly offered under the head capital gains. It is noteworthy that the revenue, in its appeal for AY 2002-03, accepted the stand of Ld. CIT(A) and did not prefer any further appeal qua this issue. Therefore, following the rule of consistency, we see no reason to disturb the findings of Ld. CIT(A) in this year and therefore, inclined to dismiss revenue’s appeal on this ground. Resultantly, the revenue’s appeal stands dismissed. Interest u/s 234D on the premises that the quantum assessment order u/s 143(3) read with section 147 did not contain any specific directions for the same. However, it is settled legal position that charging of interest is mandatory and consequential in nature and therefore, no specific direction to charge the same is required in the quantum assessment order. So far as the quantum is concerned, we find that the assessee has been charged interest u/s 234D pursuant to original quantum assessment order passed u/s 143(3). We have already dismissed revenue’s appeal for this year and therefore, practically, the assessee is not saddled with any further additions in reassessment proceedings. Hence, this ground raised by the assessee also becomes infructuous and hence, dismissed in limine
|