TMI Blog2009 (4) TMI 474X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed - - - - - Dated:- 16-4-2009 - Member(s) : U. B. S. BEDI., AHMAD FAREED. ORDER-AHMAD FAREED, A.M.: This appeal by the Department is directed against the order of CIT(A), dt. 21st April, 2008 for asst. yr. 2003-04. 2. The grounds raised by the Department in this appeal are as under: 1. The order of the learned CIT(A) is contrary to law and facts and circumstances of the case. 2.1 The learned CIT(A) erred in holding that the assessee is entitled for MAT credit for the assessment year under consideration. 2.2 The learned CIT(A) ought to have seen that Circular No. 763, dt. 18th Feb., 1998 has made the intention of the statute very clear that the benefit of carry forward of MAT credit is restricted to only five assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut of the MAT credit available under s. 115JAA for the asst. yr. 1997-98 to the tune of Rs. 59,04,340, the balance sum of Rs. 14,69,706 was set off during the asst. yr. 2003-04. As per s. 115JAA(3) the amount of tax credit determined under sub-s. (2) shall be carried forward and set off in accordance with the provisions of sub-ss. (4) and (5) but such carry forward will not be allowed beyond the fifth assessment year immediately succeeding the assessment year in which the tax credit becomes allowable under sub-s. (1). According to the above provision, the tax credit on account of 115JAA for the asst. yr. 1997-98 will be available for set off upto asst. yr. 2002-03 only and after that it cannot be set off. Hence, tax credit of Rs. 14,69,70 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT(A). He contended that under sub-s. (3) of s. 115JAA the carry forward of tax credit is available upto the fifth assessment year immediately succeeding the assessment year in which tax credit became allowable under sub-s. (1), that there was no ambiguity in the language of the statute, and that a circular which was contrary to statutory provisions had no existence in law. 7, We have considered the rival submissions in the light of material on record and the precedent cited. The short issue for adjudication in this case is: 'for how many years the carry forward is allowable under s. 115JAA(3) of the Act'. 7.1 The scheme of levying minimum alternative tax (MAT) on zero-tax companies was introduced by the Finance Act, 1996 w.e.f. 1st Apr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his order as under: "5. I have gone through the facts of the case and the submissions made by the appellant on this issue. The details of tax credit allowed as per the letter filed by the appellant on 14th Aug., 2006 with the AO is as under: Accordingly in our case tax credit shall be allowable for set off from asst. year 1998-99, which succeeds asst. yr. 1997-98 in which tax credit was allowed, for the succeeding 5 years i.e., from asst. yr. 1999-2000 upto asst. yr. 2003-04 as given below: --------------------------------------------------------- Asst. Tax credit allowed Tax credit availed No. of yr. under s. 115JA under s. 115JAA years allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom the asst. yr. 1999-2000 and ends in the asst. yr. 2003-04 and therefore the officer is hereby directed to allow the tax credit available for the asst. yr. 2003-04." 9. In our opinion the CIT(A) has rightly interpreted the sub-s. (3) of s. 115JAA of the Act. The sub-s. (3) says, "......... such carry forward shall not be allowed beyond the fifth assessment year immediately succeeding the assessment year in which tax credit became allowable under sub-s. (1)". 9.1 There is no ambiguity in the language of sub-s. (3) of s. 115JAA. The carry forward is available for a total of six (1 + 5) years. It appears that the above confusion has arisen because of the language used in the CBDT Circular No. 763, dt. 18th Feb., 1998. The para 45.4 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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