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2019 (5) TMI 529 - AT - Income TaxAdjustment to book profit u/s 115JB for calculation of MAT - share of the assessee in the income of joint venture - scope of amendment in Section 115JB - share in the income of AOP or BOI - HELD THAT:- The share of a partner in the total income of the firm is exempt as per provisions of Section 10(2A) and consequently is excluded from the total income of the partner and therefore, the said share shall be excluded while computing the book profit U/s 115JB as envisaged in clause (ii) of explanation (1) to the said Section. The reference in second proviso to Section 86 is made to the association of persons or body of individuals whose total income is exempt U/s 10 of the Act and not otherwise. Once the share in the joint venture which is treated as share in the association of persons is not hit by the second proviso to Section 86 then the same is akin the share from the partnership firm. Thus to bring it to the parity of share in partnership firm, the amendment in Section 115JB vide Finance Act, 2015 was brought by inserting clause (iic) w.e.f. 1/4/2016. Therefore, the purpose and intention to bring the amendment is to remove the mischief or hardship of the assessee on MAT in respect of the income being share in the association of persons or body of individuals which is otherwise not subject to income tax in accordance with the provisions of Section 86 of the Act. As decided in M/S GOLDGERG FINANCE PVT. LTD. VERSUS ACIT- CIRCLE – 3, THANE [2017 (2) TMI 643 - ITAT MUMBAI] the mischief which has been sought to be remedied is that the share income of the member of the AOP which was not taxable in terms of section 86 was getting taxed under MAT while computing the book profit. This was also never the purpose of section 115JB to tax any income or receipts which is otherwise not taxable under the Act. If the intention of legislature was always that income which is not taxable under the normal provisions of the Act should not be brought to tax under MAT also, then it has to be interpreted that such a benefit has to be given to all and where the income is otherwise not taxable under the Act cannot be brought to be taxed under MAT. Therefore, any remedy brought by an amendment to remove the disparity and curb the mischief has to be reckoned as curative in nature and hence, is to be held retrospectively. Accordingly, this issue is allowed in favour of the assessee.
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