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2019 (2) TMI 115 - AT - Income TaxRevision u/s 263 - MAT - Modification of books profits - Held that:- The provisions of section 115JB is very clear that the profit or loss should be the same as laid before AGM. The assessee cannot alter the book profit by not following an Accounting Standard. What is relevant is the profit adopted in the AGM even after the qualification by the statutory auditors in the given case. Therefore, the profit adopted by the company in the AGM overlooking the qualification of auditor is the final book profit for the purpose of section 115JB, the assessee cannot alter the same by claiming that it had not followed certain Accounting Standards. All the judicial pronouncements relied on by the assessee are the direction to the AO to go beyond and modify the book profit if the assessee not followed the Accounting Standard. The assessee has no right to modify the profit declared as per Companies Act and adopt differently for the purpose of MAT provisions. As per the judicial pronouncements, AO can and must modify the book profit in case the company not followed the Accounting Standards as per the provisions of Companies Act. Whereas the assessee has prepared the financial statement by following accounting system, standards and methods as per the provisions of Companies Act and laid before the company in the AGM. Once the financial statements are ratified by the shareholders, the assessee cannot modify the book profit as per the first provision to section 115JB(2). Therefore, the wrong interpretation of law empowers ld. CIT to invoke provisions of section 263. - Decided against assessee.
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