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2019 (4) TMI 1611 - AT - Income TaxDeduction on provision for leave encashment - post payment of taxes - HELD THAT:- In the instant case, as mentioned earlier the assessee vide submission dated 10.12.2014 has filed a specific note before the AO regarding deduction on provision for leave encashment along with the decision of the Supreme Court, wherein it was submitted before the AO that provision for leave encashment has been made post payment of taxes in line with the Supreme Court decision in Exide Industries Ltd. . [2007 (6) TMI 175 - CALCUTTA HIGH COURT]. Revision u/s 263 - Disallow the foreign taxes paid in Spain on which no relief u/s. 90 could be claimed disregarding the fact that the AO has after detailed examination - deduction of Income-tax paid in Spain (in excess of foreign tax credit equivalent to MAT) vide order u/s. 143(3) r.w.s. 144C - deduction on account of Income-tax paid in Spain u/s. 37(1) - HELD In the present case, the assessment order passed by the AO on the above issue follows the decision Reliance Infrastructure Ltd. [2016 (12) TMI 1293 - BOMBAY HIGH COURT] Further, as the issue of allowability of deduction u/s 37(1) of foreign tax credit on which tax credit is not available u/s 90 has been admitted by+ case of Tata Sons [2013 (2) TMI 735 - BOMBAY HIGH COURT] , the same being a debatable issue, no revisionary proceedings u/s 263 is tenable. Thus, the 3rd ground of appeal is allowed. MAT computation u/s 115JB - add back the Income-tax paid in Spain while computing book profit u/s. 115JB - AO has after detailed examination, allowed Income-tax paid in Spain (in excess of foreign tax credit equivalent to MAT) vide order u/s 143(3)r.w.s 144C - HELD THAT:- As mentioned earlier, as per clause (a) to Explanation 1 to section 115JB(2) of the Act, income tax paid or payable, which is debited to the profit and loss account is to be added back while computing book profits u/s 115JB of the Act. Thus as per section 115JB of the Act, only taxes specified in Explanation 2 can be added back while computing book profits. In this regard we may refer to the decision in Rashtriya Chemicals & Fertilizers Ltd [2018 (3) TMI 1564 - ITAT MUMBAI]. The CBDT Circular No. 1/2009 dated 27.03.2009 containing Explanatory Notes to Finance Act, 2008 clarifies the above issue. Therefore, the 4th ground of appeal is allowed.
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