The Tax Publishers2020 TaxPub(DT) 0023 (Mum-Trib) : (2020) 203 TTJ 0450

INCOME TAX ACT, 1961

Section 115JB

Provision for meeting liability for encashment of earned leave by the employees had been made by assessee on actuarial basis, therefore, same being in the nature of ascertained liability could not have been added by AO for determining 'book profit' under section 115JB.

MAT - Computation of book profit - Treatment of provision for leave encashment made on actuarial basis -

AO while computing book profit under section 115JB, added provision for leave encashment to 'net profit' of assessee. Held: Provision for meeting liability for encashment of earned leave by the employees had been made by assessee on actuarial basis, therefore, same being in the nature of ascertained liability could not have been added by AO for determining 'book profit' under section 115JB.

Relied:Bharat Earth Movers v. CIT (2000) 245 ITR 428 (SC) : 2000 TaxPub(DT) 1505 (SC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2005-06

INCOME TAX ACT, 1961

Section 115JB

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