MASTEK LIMITED,,AHMEDABAD vs. THE DY.CIT, (OSD) - 1, CIRCLE-4,, AHMEDABAD

This appeal by the Assessee is preferred against the order of the Ld. CIT(A)-2, Ahmedabad dated 24.11.2014 pertaining to A.Y. 2009-10.

Briefly stated the facts of the case are that the assessment was framed u/s. 143(3) r.w.s. 144C of the Act vide order dated 28.03.2015. The returned income was assessed under normal rate of tax at Rs. 34,31,44,411/- and the book profit was taken at Rs. 99,79,75,083/- for the purpose of 115JB of the Act.

Vide notice dated 13.01.2014, the A.O. formed a belief that there is a mistake apparent from record which needs to be rectified because disallowance of Rs. 41,46,720/- made u/s. 14A of the Act has not been considered for working of book profit u/s. 115JB of the Act.

The mistake was rectified and Rs. 41,46,720/- was added to the book profit for the computation of book profit u/s. 115JB of the Act.

Assessee carried the matter before the ld. CIT(A) but without any success.

Before us, the ld. counsel for the assessee pointed out that this issue has been considered by the Tribunal Special Bench, Delhi in the case of Vireet Investment Pvt. Ltd. in ITA No. 502/Delhi/2012. Per contra, the ld. D.R.

We have given a thoughtful consideration to the orders of the authorities below. In our considered opinion, by not considering the disallowance made u/s. 14A for the purposes of the computation of book profit u/s. 115JB a rectifiable mistake was apparent from the record and therefore, there is no infirmity in rectifying the order u/s. 154 of the Act. However, we find that the Tribunal Special Bench, Delhi had the occasion to consider this issue and has held that disallowances made u/s. 14A are not to be considered for the computation of book profit u/s. 115JB of the Act. Respectfully following the same, we direct the A.O. to delete Rs. 41,46,720/- form the computation of book profit u/s. 115JB of the Act.

Appeal filed by the Assessee is partly allowed.