TMI Blog2021 (2) TMI 665X X X X Extracts X X X X X X X X Extracts X X X X ..... in the said Clause (iii) of Explanation 1 to Section 115JB of the Act would be as per books of accounts . Hence, unless the entire loss as per books of accounts gets wiped out by profits earned in subsequent years, the said loss would continue to remain in the balance sheet of the assessee i.e. books of accounts and would be eligible for reduction in accordance with Clause (iii) of Explanation 1 to Section 115JB of the Act, while computing book profits u/s.115JB of the Act. We find that this issue is no longer res-integra in view of the decision of DCIT vs. Binani Industries [ 2016 (3) TMI 873 - ITAT KOLKATA ] Thus we direct the ld. AO to grant reduction of unabsorbed depreciation and re-compute the book profits u/s.115JB of the Act t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15 on 29/11/2014 declaring nil losses under normal provisions of the Act which was later revised on 31/03/2016 declaring loss of ₹ 35,76,576/- and book loss u/s.115JB of the Act at ₹ 8,66,22,306/-. This book loss was arrived by the assessee after deducting lower of brought forward business loss / unabsorbed depreciation as per books of accounts. We find that assessee had made a net profit of ₹ 8,48,95,742/- and had reduced the least, being unabsorbed depreciation as per books of accounts while computing the book profit u/s 115JB of the Act. We find that the ld. AO had observed that while determining book profit u/s.115JB of the Act for A.Y.2011-12 and 2013-14, the assessee had already availed reduction on account of deprec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at such provisions are apparently not present in computing the book profits u/s.115JB of the Act. We find that what is contemplated in Clause (iii) of Explanation 1 to Section 115JB of the Act is the simple numerical figure being the amount of loss brought forward or unabsorbed depreciation whichever is less. Hence, it could be safely concluded that it is a simple determination of numerical amount which would be eligible for reduction from net profit for the purposes of arriving at the book profit u/s.115JB of the Act. We also find that most crucial expression used in the said Clause (iii) of Explanation 1 to Section 115JB of the Act would be as per books of accounts . Hence, unless the entire loss as per books of accounts gets wiped out b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lower of 'unabsorbed depreciation' or 'business loss' was actually 'NIL'. 3.2. The Learned DR vehemently supported the order of the Learned AO. In response to this, the Learned AR argued that the finding given by the Learned AO that the loss as per books of accounts once reduced from book profits in earlier years would not be available for reduction in the subsequent years. He stated that the losses would continue to remain in the books of accounts till it is wiped out by profits derived by the assessee. Accordingly, he argued that the assessee company is very much entitled for reduction of least of the cash loss or depreciation loss as per books of accounts from book profits for computation u/s 115JB of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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