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Income Tax Appellate Tribunal, DELHI BENCH ‘E’ : NEW DELHI
Before: HON’BLE, SHRI G.D. AGRAWAL & SHRI KULDIP SINGH
per the book profit to be reduced and not as per Income-tax record which have been computed under the provisions of the act and as
per books of account, it is only the loss which is to be considered and not the amount i.e. not allowable under any provisions of the Act.
11. Identical issue has come up before the Tribunal in assessee’s own case in AY 2009-10 in order dated 31.05.2013 decided in favour of the assessee by returning the following findings :-
“10. Ld. Counsel submitted that sec. 79 which disentitles a company in which public is not substantially interested to carry forward and set of the losses against current years income in case there is change in shareholding, is not applicable while computing book profits u/s 115JB. In this regard he submitted that sec. 79 starts with the words “notwithstanding anything contained in this chapter”, whereas sec. 115JB starts with the words “notwithstanding anything contained in any other provision of this Act”. He, therefore, submitted that applicability of sec. 79 is confined to Chapter VI, whereas section 115JB is a code and, therefore, the book profits have to be computed as per the provisions contained therein. In this regard he relied on the decision in the case of N.J. Jose & Co. (P) Ltd. vs. Asstt. CIT, 321 ITR 132.
We have considered the submissions of both the parties and have perused the record of the case.
We find that AO has not disallowed the assessee’s claim invoking section 79 but on account of no details being there of business loss in the return as well as in the computation of income. Therefore, we need not to go into this issue.” 12. The assessee has brought on record the details of carry forward profit / loss up to 31.03.2009 as per books of account, copy of actuarial valuation of the earned leave liability including compensated absence for the period from 01.04.2009 to 31.03.2010 as per AS-15 (R), copy of actuarial valuation of the gratuity liability for the period from 01.04.2009 to 31.03.2010 as per AS-15 (R) and copy of annual accounts for the period ending 31.03.2010, available at pages 46 to 72 of the paper book. We are of the considered view that all these documents are required to be verified by the AO as to the figures of brought forward business loss or depreciation, actuarial valuation of the earned leave liability and actuarial valuation of the gratuity liability to recompute the book profit u/s 115JB. So, following the decision rendered by the coordinate Bench of the Tribunal in assessee’s own case for AY 2009-10 (supra), grounds no.3 & 3.1 are determined against the Revenue as per observation made herein above.
Resultantly, the appeal filed by the Revenue is dismissed. Order pronounced in open court on this 10th day of November, 2017.