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TMI Blog2014 (2) TMI 1071X X X X Extracts X X X X X X X X Extracts X X X X ..... tal loss of Rs.256,09,26,436/-. The assessment was completed under section 143(3) of the Income Tax Act on 31.03.2005 by determining total income at NIL and book profit under section 115JB of Rs.171,77,15,332/-. Subsequently, the assessment was reopened under section 147 by issuing notice under section 148 dated 26.03.2007. Thereafter, the assessment was completed under section 143(3) read with section 147 of the Act. 3. The first ground of appeal of the assessee relates to reopening of assessment. The ld. CIT(Appeals) has considered the reopening and observed that in this case, the reassessment was done by reopening the assessment within a period of four years from the end of the assessment year and was not reopened based on any change of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eased to admit the following as an Additional Ground: 1. In as much as the appellant is not a company as per the Companies Act, 1956 the provisions of section 115JB is not applicable to the appellant based on the decisions in the case of ITAT Mumbai in the case of Krung Thai Bank Limited (ITA No.3390/Mum/09) ITAT Chennai in the appellants own case (ITA No.469/MDS/2010) and hence no tax can be levied based on the book profits. 2. Without prejudice to the above contention, the book profits can only be computed based on Part II and III of Schedule VI of Companies Act and therefore the AO had erred in adopting the profits as computed under Schedule III of Banking Regulation Act while computing such book profits u/s 115JB." 8. The assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before the Tribunal was not raised before the ld. CIT(Appeals). Nevertheless, according to him, it is pure question of law, the Tribunal has to be admitted though it was not raised before the lower authority. He has also submitted that the very similar issue has been raised before the Tribunal for the assessment year 2004-05 to 2006-07 and the same was admitted. 10. On the other hand, the ld. DR did not object on the additional grounds raised by the assessee. 11. We have heard both sides. We find from the consolidated order of the Tribunal in assessee's own case in I.T.A. Nos. 470 to 472/Mds/2010 for the assessment years 2004-05 to 2006-07 vide order dated 11.06.2012, wherein the Tribunal has considered additional ground raised by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d April, 2011 as under:- "7. We have heard the rival submissions and perused the orders of the lower authorities and the material available on record. In the instant case, the only dispute raised by the assessee is that since it is a bank and is required to prepare its accounts according to Banking Regulation Act, 1949 and not according to Schedule VI Part II and III of the Companies Act, 1956, the provisions of section 115JB are not applicable to it while computing the income under MAT. We find that recently the Mumbai Bench of the Tribunal in the case of in the case of Krung Thai Bank PCL Vs. Joint Director of Income Tax [International Taxation] [2010] 45 DTR 218 has held has under: "7. The plea of the assessee is indeed well taken, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee." Respectfully following the decision of the Co-ordinate bench, we hold that the provisions of Sec.115JB could not be applied on the assessee. In the result, this issue stands decided in favour of assessee." 15. Respectfully, following the decision of the Coordinate Bench in I.T.A. No. 08/Mds/2007 for the assessment year 2003-04, the ground of appeal raised by the assessee is allowed. 16. Ground Nos. 3 and 4 are mere academic and are dismissed as not pressed. 17. In the result, the appeal filed by the assessee is partly allowed. I.T.A. No. 886/Mds/2010 18. The only effective ground raised by the Revenue is with regard to interest on securities. At the time of hearing, the ld. Counsel for the assessee has submitted that the issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prematurely before the date of redemption like bank deposits. A fixed bank deposit can be redeemed even before the maturity date and the depositor may get a portion of the interest accrued on the deposit till the date of surrender. In such cases, the interest is generated on accrual basis. But in the case of a Government security, it is not possible to encash it prior to the due date. A holder of the security may be able to sell it to another person; but there is no provision for premature encashment. Encashment can be made only on the due date. When the principal amount involved in the instrument itself is redeemable only on due date, there is no reason to hold that the interest element would be generated on accrual basis. The interest als ..... X X X X Extracts X X X X X X X X Extracts X X X X
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