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Commissioner Of Income Tax, Delhi vs M/S. Mgf India Ltd. on 21 February, 2018 cites

Commissioner Of Income Tax, Large Tax ... vs Indian Railway Finance Corporation Ltd on 23 March, 2015

10. The second issue is whether the value of NPAs is to be adjusted while determining book profits under Section 115 JA of the Act. The assessee here argues that lease equalization is not a provision for diminution in asset value and is a mere adjustment entry. It was argued that in this case, since lease equalization was to the tune of ` 6,24, 96,982/- and debited to the profit and loss account, and since the lease charges shown in the P&L Account were the net amount of lease equalization charges, the gross block of fixed assets was simultaneously reduced by an amount of ` 9,08,03,993/- which was the ITA 378/2004 & ITA 76/2007 Page 8 of 10 accumulated lease adjustment. Therefore, no adjustment was made which could be treated as being adjustment towards diminution in the value of assets. The assessee relies on Commissioner of Income Tax v. Indian Railway Finance Corporation Ltd. 2014 (362) ITR 548.
Delhi High Court Cites 1 - Cited by 1 - S R Bhat - Full Document

Joint Cit vs Pact Securities & Financial Ltd. on 26 March, 2002

Reliance was placed on Prakash Leasing Ltd. v. Commissioner of Income Tax (2012) 208 Taxman 464 (Karn); Commissioner of Income Tax v. Indian Railway Finance Corp. Ltd (2014) 362 ITR 548; Commissioner of Income Tax v. ICICI Ventures Funds Management Co. Ltd 2015 234 Taxman 569 (Karn); Commissioner of Income Tax v. Pact Securities and Financial Services Ltd (2015) 374 ITR 681 (AP & T) and Commissioner of Income Tax v. Sun Pharmaceutical Industries Ltd. 2016 (240) Taxman 686 (Guj). Counsel submitted that the amount is nothing but the difference between the statutory ITA 378/2004 & ITA 76/2007 Page 6 of 10 depreciation on rentals and the recovery of cost of capital. Therefore, merely because it entered in the P&L account, did not make any difference. At any rate, it could not be treated as a reserve. Therefore, ITAT was justified in directing deletion of the said amount.
Income Tax Appellate Tribunal - Hyderabad Cites 10 - Cited by 18 - Full Document

Cit vs Virtual Soft Systems Ltd. on 7 February, 2012

Next is the lease equalization charge: it is described in Virtual Soft Systems (supra) as "the result of the adjustment, which the assessee has to make whenever, the amount put aside towards capital recovery is not equivalent to the depreciation claimed by the assessee. The assessee, may claim depreciation based on the provisions of the IT Act or, may even adopt the method of depreciation provided under the Companies Act. In the event, the depreciation claimed is less than the capital recovery, the difference is debited in the profit and loss account in the form of lease equalization charge, and similarly if, for any reason the depreciation claimed is more than capital recovery then, the difference is credited, once again, in the form of lease equalization charge to the profit and loss account. Therefore, the assessee in effect debits or credits its profit and loss account with a lease equalization charge depending on whether or not the depreciation claimed is, less or more than the capital recovery."
Delhi High Court Cites 18 - Cited by 6 - R Shakdher - Full Document
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