{"id":546,"date":"2015-11-21T15:01:38","date_gmt":"2015-11-21T15:01:38","guid":{"rendered":"http:\/\/caindelhiindia.com\/blog\/?p=546"},"modified":"2021-07-07T12:00:45","modified_gmt":"2021-07-07T12:00:45","slug":"546","status":"publish","type":"post","link":"https:\/\/www.caindelhiindia.com\/blog\/546\/","title":{"rendered":"INCOME TAX RETURN UPDATE NOV 18, 2015"},"content":{"rendered":"

UPDATES ON INCOME TAX RETURN<\/strong><\/span><\/p>\n

RECEIPT SHOWN IN P&L A\/C LIABLE TO MAT EVEN IF IT IS SHOWN AS CAPITAL RECEIPT IN NOTES TO ACCOUNT-<\/span><\/strong><\/p>\n

IT<\/strong><\/span> : Remission of bank loan shown in P&L A\/c shall not be excluded for computing book profits under section 115JB even if same was shown as capital receipt in notes to accounts [2015]\u00a0122 (Bangalore – Trib.) IN THE ITAT BANGALORE BENCH ‘A’ B & B Infotech Ltd\u00a0v.\u00a0Income-tax Officer, Ward 12(1), Bangalore<\/p>\n

Facts:<\/strong><\/span><\/p>\n

Assessee filed its return declaring NIL income for the A.Y 2005-06.<\/p>\n

Subsequently, Assessing Officer issued notice under section 148 and levied MAT on remission of liability of bank loan of Rs 43 lakhs.<\/p>\n

Ld. AR of assessee relied upon judgment of\u00a0Andhra Pradesh High Court in case of CIT v. Nagarjuna Feterilizers & Chemicals Ltd.\u00a0and submitted that wherein assessee had disclosed said amount as capital receipts in notes to accounts, then said amount shall be excluded from Profit and loss account for purpose of book profits under section 115JB. He further submitted that even if said amount was shown by assessee in P&L A\/c but the effect of disclosure in notes to accounts would be that said amount should not be considered as part of P&L A\/c.<\/p>\n

The ratio of decision relied upon by assessee is based on premise that if an item of income or expenditure is required as per Part II of Schedule VI of companies Act to be part of P&L A\/c, but the same was not disclosed in the P&L A\/c and has been disclosed in notes forming part of the accounts, then the said disclosure in the notes to the accounts would be treated as disclosure of that particular item of income or expenditure as the case may be, in the P&L A\/c for the purpose of book profits under section 115JB.<\/p>\n

The decision relied upon by assessee would be applicable where if an item of income or expenditure which is required to be disclosed in the P&L A\/c prepared as per provisions of Schedule VI of the Companies Act but instead of disclosing the said item in the P&L A\/c, it was disclosed in the note to accounts.<\/p>\n

Once P&L A\/c is admittedly prepared as per schedule VI of the Companies Act, then neither the AO has any power to tinker with it nor the assessee is permitted to claim exclusion or inclusion of any item of income or expenditure as the case may be for the purpose of computing book profits under section 115JB except the permissible adjustment provided under the explanation to Sec. 115JB of the Act.<\/p>\n

It was not disputed that said amount does not fall in the ambit of any of the clauses of the Explanation to section 115JB. Therefore, once this amount has been disclosed in the P&L A\/c prepared strictly as per provisions of Schedule VI of the Companies Act, the same cannot be excluded for the purpose of computing book profits under section 115JB.<\/p>\n

Therefore, there was no error in the order of CIT(A).<\/p>\n

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact:info@caindelhiindia.com<\/a>\u00a0or call at\u00a0011-23343333<\/p>\n","protected":false},"excerpt":{"rendered":"

UPDATES ON INCOME TAX RETURN RECEIPT SHOWN IN P&L A\/C LIABLE TO MAT EVEN IF IT IS SHOWN AS CAPITAL RECEIPT IN NOTES TO ACCOUNT- IT : Remission of bank loan shown in P&L A\/c shall not be excluded for computing book profits under section 115JB even if same was shown as capital receipt in …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[142,146,100],"tags":[567,568,569,571,570,572,179,180,214,181,194],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/posts\/546"}],"collection":[{"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/comments?post=546"}],"version-history":[{"count":8,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/posts\/546\/revisions"}],"predecessor-version":[{"id":1216,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/posts\/546\/revisions\/1216"}],"wp:attachment":[{"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/media?parent=546"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/categories?post=546"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.caindelhiindia.com\/blog\/wp-json\/wp\/v2\/tags?post=546"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}