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1 - 10 of 12 (0.21 seconds)Section 115JB in The Income Tax Act, 1961 [Entire Act]
The Income Tax Act, 1961
The Commissioner Of Income Tax-2 vs Raymond Ltd on 21 March, 2012
5. The Ld. AR further submitted that in respect of disallowance of Rs. 857 crores
u/s 14A of the Income Tax Act, 1961 and addition to book profits u/s 14A of the Act,
such an issue is covered in assessee's own case for the assessment year 2011-12 and
5
SA No.2/Del/2020
followed in subsequent years in favour of the assessee. In respect of additions on
account of out of books receivables, the Ld. AR submitted that the Assessing Officer
never rejected the books of accounts maintained by the Applicant under Section 145 of
the Act. The Ld. AR submitted that when the books of account were not rejected, the
adjustment cannot be made to the book profit, more so when the adjustment made
does not fall under any of the specified adjustment under Explanation to Section
115JB of the Act. As regards to adjustment on account of reversal of provision for tax,
the Ld. AR submitted that the amalgamating entities in their computation of income
for the respective assessment years, had duly added back the amount of provision for
tax created in those years. Therefore, the amount of provision for tax had already been
added as part of Book Profit. This amounts to double taxation in assessee's case. As
regards to addition on account of debenture redemption reserve, the Ld. AR submitted
that the evidence placed before the Revenue reflects that the said reserve is calculated
on scientific basis. The Ld. AR relied upon the decision of the Hon'ble Supreme Court
in case of National Rayon Corporation Ltd. vs. CIT 227 ITR 764 and Hon'ble Bombay
High Court decision in case of CIT vs. Raymond Ltd. 209 Taxman 65. As regards to
addition on account of provision for Bad and Doubtful debts, the Ld. AR submitted
that the provisions are made against the moneys that are to be received by the assessee
in due course of business and the said provision reflect an estimate of amounts that
end up as bad debts as the same are never received by the assessee. The said amounts
are not against the liabilities as they are not made against any payable/liability of the
assessee. Thus, it does not fall within the ambit of the Clause (c) of the Explanation 1
6
SA No.2/Del/2020
of Section 115JB of the Act.
National Rayon Corporation Ltd vs The Commissioner Of Income Tax on 29 July, 1997
5. The Ld. AR further submitted that in respect of disallowance of Rs. 857 crores
u/s 14A of the Income Tax Act, 1961 and addition to book profits u/s 14A of the Act,
such an issue is covered in assessee's own case for the assessment year 2011-12 and
5
SA No.2/Del/2020
followed in subsequent years in favour of the assessee. In respect of additions on
account of out of books receivables, the Ld. AR submitted that the Assessing Officer
never rejected the books of accounts maintained by the Applicant under Section 145 of
the Act. The Ld. AR submitted that when the books of account were not rejected, the
adjustment cannot be made to the book profit, more so when the adjustment made
does not fall under any of the specified adjustment under Explanation to Section
115JB of the Act. As regards to adjustment on account of reversal of provision for tax,
the Ld. AR submitted that the amalgamating entities in their computation of income
for the respective assessment years, had duly added back the amount of provision for
tax created in those years. Therefore, the amount of provision for tax had already been
added as part of Book Profit. This amounts to double taxation in assessee's case. As
regards to addition on account of debenture redemption reserve, the Ld. AR submitted
that the evidence placed before the Revenue reflects that the said reserve is calculated
on scientific basis. The Ld. AR relied upon the decision of the Hon'ble Supreme Court
in case of National Rayon Corporation Ltd. vs. CIT 227 ITR 764 and Hon'ble Bombay
High Court decision in case of CIT vs. Raymond Ltd. 209 Taxman 65. As regards to
addition on account of provision for Bad and Doubtful debts, the Ld. AR submitted
that the provisions are made against the moneys that are to be received by the assessee
in due course of business and the said provision reflect an estimate of amounts that
end up as bad debts as the same are never received by the assessee. The said amounts
are not against the liabilities as they are not made against any payable/liability of the
assessee. Thus, it does not fall within the ambit of the Clause (c) of the Explanation 1
6
SA No.2/Del/2020
of Section 115JB of the Act.
Section 92CA in The Income Tax Act, 1961 [Entire Act]
M/S. Vireet Investment Pvt. Ltd., New ... vs Acit, New Delhi on 16 June, 2017
The Ld. AR further submitted that an
addition on account of expenses incurred in respect of exempt income under Section
14A, the action of the DRP and the Assessing Officer in making an upward adjustment
to the Book Profits of the Applicant under Section 115JB of the Act qua disallowance
under Section 14A of the Act is in blatant disregard of the ruling of the Special Bench
of the Tribunal in case of ACIT vs. Vireet Investment (P.) Ltd. 82 taxmann.com 415
(Del. Tri.) (SB), wherein the Tribunal unequivocally held that computation under
clause (f) of Explanation 1 to Section 115JB(2) is to be made without resorting to
computation as contemplated under Section 14A read with Rule 8D.