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2020 (2) TMI 1102 - HC - Income TaxComputing book profit u/s 115-J - assessee entitled to charge arrears of depreciation due to a change in the method of providing depreciation for earlier years to the profit and loss account of the current year - Correct interpretation of Section 115-J for determining the “Book Profit”, the appellant had option to adopt depreciation rates prescribed in the Income Tax Rules, 1962 in preference to the rates prescribed in Schedule XIV of the Companies Act, 1956 - HELD THAT:- Assessing officer while computing the income under Section 115-J has only the power of examining whether the books of account are certifies by the authorities under the Companies Act as having been properly maintained in accordance with the Companies Act. The assessing officer thereafter has the limited power of making increases and reductions as provided for in the Explanation to the said section. To put it differently, the assessing officer does not have the jurisdiction to go behind the net profit shown in the profit and loss account except to the extent provided in the Explanation to Section 115-J. See APOLLO TYRES LTD. VERSUS COMMISSIONER OF INCOME TAX [2002 (5) TMI 5 - SUPREME COURT] Question is answered in favour of the assessee. The matter is remanded back to the Assessing Officer to compute the income under Section 115J of the 1961 Act in accordance with law.
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