TMI Blog2022 (10) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in the case of Appollo Tyres [ 2002 (5) TMI 5 - SUPREME COURT] has laid down the principle that the AO does not have the jurisdiction to go beyond the net profit shown in the Profit Loss Account except to the extent provided in Explanation to Section 115JB. We notice that in the case of PCIT vs. Mphasis Software and Services (India) Pvt Ltd [ 2022 (1) TMI 790 - KARNATAKA HIGH COURT] which considered in the case of J.J. Glastronics P. Ltd [ 2022 (4) TMI 1187 - KARNATAKA HIGH COURT] held that invoking section 154 would be untenable when the matter requires adjudication upon the issue which is debatable issue. In view of these discussions and considering the decisions of the jurisdictional High Court we hold that the AO is not c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide orders dated 31.12.2018.The AO accepted the computation of book profits u/s.115JC of the Act for these assessment years while completing the assessment u/s.143(3) r.w.s. 153A. 3. In AY 2015-16 and AY 2016-17 the AO made an addition of Rs.90,00,000 and Rs.16,45,00,000 respectively towards the additional income offered by the Shri Gopalan, during survey proceedings towards expenses to be disallowed. The AO issued rectification order u/s.154 dated 19.02.2021 for both the assessment years wherein he had stated that the above disallowance/addition was omitted to be added to the book profits for the purpose of computing Alternate Minimum Tax (AMT)u/s.115JC and that the mistake is to be corrected through the rectification order. The assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Supreme Court in the case of Appollo Tyres vs. PCIT (2002) 255 ITR 273 (SC). The learned AR also relied on the decision of the Jaipur Bench of the Tribunal in the case of Gie Jewels vs ITO (2017) 88 taxmann.com 290 (Jaipur Trib) held that though provisions of section 115JC though applicable to a different set of persons however the scheme and objective of the said provision is akin and pari material to the provisions of 115JB . Therefore the learned AR argued that the principle laid down by the Supreme Court in the case of Appllo Tyres (supra) should hold good for 115JC also and therefore no adjustment could be made to the book profits. The learned A.R. further submitted that for the purpose of Section 115JC of the Act Form 29C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax credit allowed under this section shall also be varied accordingly. Therefore the learned DR submitted that modification to alternate minimum tax which is tax on book profits u/s.115JC can be varied as a result of any order passed under the Act. The learned DR thus supported the order of the AO passed u/s.154 of the Act. 8. We have heard the rival contentions and perused the material on record. During the course of hearing the learned AR presented arguments on merits stating that the impugned additions made based on the admissions made during the course of survey are not tenable. The learned AR also argued on the legal issue whether the additions to book profits can be done by an order of rectification u/s154. For the purpose of adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Software and Services (India) Pvt Ltd [IT Appeal No. 244 of 2021, dated 25-10-2021] which considered in the case of J.J. Glastronics P. Ltd (supra) held that invoking section 154 would be untenable when the matter requires adjudication upon the issue which is debatable issue. In view of these discussions and considering the decisions of the jurisdictional High Court we hold that the AO is not correct in enhancing the book profits u/s.115JC by passing an order under Section 154 of the Act. We therefore see no reason to interfere with the order of the CIT(A) for both the assessment years. 11. In the result, the appeals filed by the Revenue for both the assessment years are dismissed. Dictated and pronounced in the open Court on 22nd Se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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