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2021 (12) TMI 588 - AT - Income TaxLevying MAT u/s 115JB - 100% reduction of the profit u/s. 80IB(10) - while computing the book profit u/s. 115JB appellant had reduced it from book profit and claimed that it was not liable for tax under, this Section - As per AO assessee is not entitled to reduce the book profit by claiming such deduction - HELD THAT:- For claiming deduction u/s. 80IB(10) from book profit, no case has been made out that this adjustment to book profit under 115JB falls under any of the adjustments mandated in section 115JB Explanation (1). Only reason given by the assessee for the purpose is that sub-section (5) mentions, save as otherwise provided in this section, all other provisions of this act shall apply to every assessee being a company, mentioned in this section. A bare reading of the above clearly shows that sub-section (5) clearly provides that ‘save as otherwise provided’ in this section all the provisions of the I.T. Act will be applicable to the computation governed by section 115JB. Hence, this clearly means that what has been provided in this section shall prevail and thereafter all other provisions shall apply. Hence, explanation (1) to section 115JB clearly provides what can be adjusted from book profit. Hence, sub-section (5) duly saves the prescription of Explanation (1). Hence, this explanation (5) does not help the assessee to claim that section 80IB deduction permissible under the I.T. Act should be adjusted from book profit As decided in APOLLO TYRES LTD. VERSUS COMMISSIONER OF INCOME TAX [2002 (5) TMI 5 - SUPREME COURT] clearly shows that there is no bar on making adjustments to book profit as per law. The above pleading is absolutely not sustainable. Hon'ble Apex Court has clearly provided that except as provided in section 115J no adjustment to the book profit can be done. The said decision of Hon'ble Apex Court is clearly applicable as noted by us hereinabove. Insertion of sub-section (5) in section 115JB in no way dilutes prescription of Explanation (1) to section 115JB which clearly specifies adjustment being made in the book profit. We are conscious that other High Courts have taken different view in this context. However, Hon'ble Bombay High Court in several decisions has followed the aforesaid decision of Hon'ble Apex Court and held that profit shown in book profit cannot be tinkered or adjusted in any manner otherwise than the manner which is mandated in the said section of the Act. Even in cases where the assessee has taken capital receipt directly to the capital reserve without routing it through profit and loss account, Hon'ble Bombay High Court has held that the Assessing Officer cannot tinker the book profit duly disclosed in the profit and loss account on the touchstone of Hon'ble Supreme Court decision in the case of Apollo Tyres Ltd. (supra). No tinkering to the book profit is permitted except as provided in Explanation (1) of Section 115JB of the Act. Various ITAT and other High Court decisions quoted by learned counsel cannot take precedence over Hon'ble Bombay High Court decision referred hereinabove. It is settled law that the decisions of other High Courts have persuasive value but decision of Hon'ble Jurisdictional High Court is binding upon all subordinate courts and Tribunals. In accordance with the discussion and precedent hereinabove we do not find any infirmity in the orders of authorities below. Hence, we uphold the same.
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