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An exempt income can’t be considered for the purpose of computation of book profit u/s 115JB: ITAT

December 3, 2019[2019] 112 55 (Mumbai - Trib.)/[2020] 180 ITD 505 (Mumbai - Trib.)

INCOME TAX: Where forward foreign exchange contracts were taken for acquiring capital assets, profits/loss arising on settlement of such contracts had to be adjusted against cost of concerned capital asset in terms of section 43A, and depreciation was to be allowed on such adjusted value of capital assets

INCOME TAX: Written Down Value of assets in hands of amalgamated companies has to be calculated without considering unabsorbed depreciation of amalgamating companies for which set off was never allowed

INCOME TAX: Interest income earned by assessee from fixed deposits kept with banks, in normal course of business was to be taxed as business income

INCOME TAX: Where, for assessment year 2006-07, subsidy was given by Government of Karnataka with an object to effect new industries in backward area of State of Karnataka in terms of sales tax exemption, subsidy was to be treated as capital receipt

INCOME TAX: Where liability for interest under section 234B had arisen only on account of a retrospective amendment to provision of section 115JB, assessee would not have anticipated retrospective amendment at time of making payments for advance tax, hence, liability of interest under sections 234B was to be deleted

INCOME TAX: A receipt exempt from tax under Income tax law, cannot be considered for purpose of computation of book profit under section 115JB, hence sales tax subsidy received by assessee being capital in nature was to be reduced from book profit computed under section 115JB
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