| The Tax Publishers2020 TaxPub(DT) 0668 (Karn-HC) : (2020) 422 ITR 0116 : (2020) 313 CTR 0069 : (2020) 270 TAXMAN 0162 INCOME TAX ACT, 1961
Section 115JB
Where Companies Act, 1956 has excluded insurance, banking companies or the companies engaged in the generation or supply of electricity from the purview of section 211(1) of the Companies Act, 1956 and resultantly from the purview of section 115JB and profit and loss account prepared in accordance with provisions of their Regulatory Act shall be taken as basis for computing book profit under section 115JB, therefore appeal of Revenue was dismissed.
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MAT - Book profit under section 115JB - Profit and loss account as basis - Companies governed by special enactments
Assessee was engaged in business of banking and claimed deduction on account of write off of non convertible debentures. AO held that since the said amounts were subject matter of another assessment year, the claim could not be entertained in the subsequent assessment year. CIT(A) upheld the order of AO. Tribunal held that provisions of section 115JB do not apply to assessee, as it was a Banking company. It was also held that assessee was entitled to deduction of the amount in question on account of it being a bad debt under section 36(1)(vii). Held: Companies Act, 1956 has excluded insurance, banking companies or the companies engaged in the generation or supply of electricity from the purview of section 211(1) of the Companies Act, 1956 and resultantly from the purview of section 115JB. Profit and loss account prepared in accordance with the provisions of their Regulatory Act shall be taken as basis for Computing book profit under section 115JB. Therefore, it was held that provisions of section 115JB(2) do not apply to the Banking companies and accordingly appeal of Revenue was dismissed.
REFERRED : CIT v. Calcutta Knitwears (2014) 43 Taxmann.Com 446 (SC) : 2014 TaxPub(DT) 1547 (SC), M/s Southern Technologies Ltd. v. JCIT (2010) 320 ITR 577 (SC) : 2010 TaxPub(DT) 1302 (SC), Hansraj and Sons v. State of Jammu and Kashmir & others (and other appeals) Air 2002 SC 2692, Apollo Tyres Ltd. v. CIT (2002) 122 Taxman 562 (SC) : 2002 TaxPub(DT) 1371 (SC), Vikrant Tyres Ltd. v. ITO 2001 (2) Sc 45 Pp. 459, 460: (2001) 3 Scc 76: Air 2001 Sc 800 : 2001 TaxPub(DT) 1110 (SC), CIT v. BC Srinivasa Setty (and Other Appeals) (1981) 128 ITR 294 (SC) : 1981 TaxPub(DT) 0902 (SC), C.I.T. v. Vadilal Lallubhai Air 1973 Sc 1016 : 1972 TaxPub(DT) 0421 (SC), CIT v. Provident Investment Company Limited AIR 1957 SC 664 and CIT-LTU v. UBI ITA No. 1196/2013 Dated 16-4-2019 : 2019 TaxPub(DT) 3212 (Bom-HC).
FAVOUR : In assessee's favour.
A.Y. :
IN THE KARNATAKA HIGH COURT
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