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Home Acts & Rules Bill Bills FINANCE BILL, 2012 Chapters List Chapter III - Part 1 Direct Taxes - Income Tax This

Clause 46 - Amendment of section 115JB. - FINANCE BILL, 2012

FINANCE BILL, 2012
Chapter III - Part 1
Direct Taxes - Income Tax
  • Contents

Amendment of section 115JB.

     46. In section 115JB of the Income-tax Act, in sub-section (2), with effect from the 1st day of April, 2013,—

           (i) for the portion beginning with the words “Every assessee,” and ending with the words and figures “the Companies Act, 1956:”, (1 of 1956.) the following shall be substituted, namely:—

      “Every assessee,—

           (a) being a company, other than a company referred to in clause (b), shall, for the purposes of this section, prepare its profit and loss account for the relevant previous year in accordance with the provisions of Part II of Schedule VI to the Companies Act, 1956; (1 of 1956.) or

           (b) being a company, to which the proviso to sub-section (2) of section 211 of the Companies Act, 1956 (1 of 1956.)  is applicable, shall, for the purposes of this section, prepare its profit and loss account for the relevant previous year in accordance with the provisions of the Act governing such company:”;

                (ii) in Explanation 1, after clause (i), for the words, brackets and letters “if any amount referred to in clauses (a) to (i) is debited to the profit and loss account, and as reduced by,—”, the following shall be substituted, namely:—

                “(j) the amount standing in revaluation reserve relating to revalued asset on the retirement or disposal of such asset,

if any amount referred to in clauses (a) to (i) is debited to the profit and loss account or if any amount referred to in clause (j) is not credited to the profit and loss account, and as reduced by,—”.

 



 

Notes on Clauses:

Clause 46 of the Bill seeks to amend section 115JB of the Income-tax Act relating to special provision for payment of tax by certain companies.

The existing provisions of sub-section (2) of aforesaid section 115JB provide that every assessee being a company shall prepare its profit and loss account in accordance with the provisions of Part-II and Part-III of Schedule VI to the Companies Act.

It is proposed to amend the aforesaid sub-section so as to provide that every assessee,

(a) being a company, other than a company to which the proviso to sub-section (2) of section 211 of the Companies Act, 1956 is applicable, shall, for the purposes of the aforesaid section, prepare its profits and loss account for the relevant previous year in accordance with the provisions of Part II of Schedule VI to the Companies Act, 1956; or

(b) being a company, to which the proviso to sub-section (2) of section 211 of the Companies Act, 1956 is applicable, shall, for the purposes of this section, prepare its profit and loss account for the relevant previous year in accordance with the provisions of the Act governing such company.

Explanation 1 to the aforesaid section provides “book profit” means the net profit as shown in the profit and loss account for the relevant previous year under sub-section (2) of the aforesaid section as increased by the amount specified in clause (a) to clause (i).

It is proposed to amend the aforesaid Explanation to insert a new clause after clause (i) so as to provide that the book profit shall be increased by the amount standing in revaluation reserve relating to revalued asset on the retirement or disposal of such asset, if not credited to the profit and loss account.

These amendments will take effect from 1st April, 2013 and will, accordingly, apply in relation to the assessment year 2013-2014 and subsequent assessment years.

 
 
 
 

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