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Income Tax Officer, Ward-1(1),, ... vs Accura Polytech Pvt. Ltd., , Ahmedabad on 23 January, 2017
cites
Section 115JB in The Income Tax Act, 1961 [Entire Act]
Section 148 in The Income Tax Act, 1961 [Entire Act]
Section 144 in The Income Tax Act, 1961 [Entire Act]
Section 250 in The Income Tax Act, 1961 [Entire Act]
Commissioner Of Income-Tax vs Hcl Comnet Systems And Services Ltd. on 18 May, 2007
10.2 With regard to second issue towards adjustment in book profit in
respect of bad debts reserves, the Ld.AR adverted our attention to the
reasons recorded and submitted that the action of the AO is founded upon
Explaantion-1(c) of section 115JB for forming requisite reason to belief
as contemplated under section 147 of the Act. He thereafter adverted our
attention to Explanation-1(c) to section 115JB and submitted that
aforesaid clause seeks to increase the book profit on account of amount
set aside to provisions made for meeting liabilities other than the
ITA No.416/Ahd/2014 (By Assessee)
and ITA Nos. 424, 425 & 426/Ahd/2014 (By Revenue)
Accura Polytech Pvt.Ltd. vs. ITO
Asst.Years -2006-07, 2006-07, 2007-08 & 2008-09
-9-
ascertained liabilities. The Ld.AR submitted that the bad debts reserves
sought to be adjusted to the book profit is not in the nature of provision
made for meeting liabilities at all. In contrast, the provision towards bad
debts reserves is on account of diminution in the value of sundry debtors.
Thus, the very premise for invoking the jurisdiction itself is wrong and
untenable. The jurisdiction under section 147 of the Act thus could not
have been assumed based on such wrongful application of provision of
the Act. On merits, the Ld.AR relied upon the judgment of Hon'ble
Apex Court in the case of CIT vs. HCL Comnet Systems & Services Ltd.
reported at (2008) 174 Taxman 118 (SC) rendered in the context of
section 115JA of the Act.
Section 115JA in The Income Tax Act, 1961 [Entire Act]
Seshasayee Paper & Board Ltd vs The Deputy Commissioner Of Income Tax on 15 May, 2015
22. On consideration of rival submissions, we find that the issue is
squarely covered on merits in favour of assessee by the judgement of the
Hon'ble Jurisdictional High Court in the case of General Motors India
(P.)Ltd.[supra]. Thus, the appeal of the Revenue cannot be sustained.
We also simultaneously observe that in view of the quashing of
reassessment order under section 147 of the Act pertaining to AY 2006-
07, the edifice for consequential action under section 155(4) of the Act
has also crumbled. Therefore, the impugned order under section 155(4)
giving rise to the cause of action of the present appeals is also rendered
infructuous. Therefore, looking from any angle, both the appeals of the
Revenue pertaining to AYs 2007-08 & 2008-09 cannot be sustained in
law. As a result, both the appeals of the Revenue are dismissed.
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