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in 331 ITR 211 four flats were purchased in one building in Rukminama ,s case and not flats in two cities. Therfore i think only one flats would be eligible for exemption .that case does not help assessee but goes aginst

Sir Hopefully rajesh Keshav Pillai Mum ITAT has now replied your querry that even for sale of two houses exemption is available

It is alos relevant ot  consider the decision of delhi high court in the case of  Goyal M G gases private Limited 312 ITR  437 and then we have to see whether the  provisions of section 4191)  for waivr of loan  is governed by the utiliation of such loan/ purposes of obtaining such loan?

[At this point, it was not necessary to dwell upon the situation, where the assessee had directly credited the profit on sale of asset to a reserve account]

rain Commodities has held that  as assessee himself credited the amount though exempt to Profit and loss account  now it is not possible to adjust it to the book profit. Now the issue is when the assessee credits the amout  of one time settlement gain from the banks to the capital reserve  as some capital is alos waived by the bank  same  can also be increased to the book profit and 115JB applicable ?
rain commdity says so that this issue is still open!!!

Hence, it was not a case of the assessee that the long-term capital gain was not includible in the profit and loss account prepared in terms of Schedule VI to the Companies Act. Only in the computation of book profit under section 115JB, the assessee claimed exclusion of long-term capital gain which was exempt under section 47(iv). It is due to fact that the assessee claimed deduction of long-term capital gain from book profit by virtue of being exempted income in the normal provisions of the Act and not because of the reason that the same was not includible in profit and loss account prepared under Part II and Part III of Schedule VI. In the circumstances, when the assessee itself had included the capital gains arising from sale of subsidiary in the profit and loss, the same could not be excluded under any of the Explanations under section 115JB. At this point, it was not necessary to dwell upon the situation, where the assessee had directly credited the profit on sale of asset to a reserve account.

This news papaer report appeared on TOI 25/6/2010
NEW DELHI: The finance ministry has mined data of Indian companies that have not been paying tax on the income earned by selling their carbon credits or certified emission reductions (CER).

These entities are likely to face penal action once a case of tax evasion is established against them. They are like any other company evading taxes and penalties would be imposed, sources in the income tax department said.

Interestingly, some of the entities on the I-T radar which have not paid tax on already redeemed income on carbon credits are listed firms. In the data mining process, the department has prepared a list of all such entities that have accumulated carbon credits and subsequently sold them.

A senior finance ministry official said that scrutiny of the balance sheets of these companies revealed that some were offering the proceeds from sale of carbon credits to the tax department, while many were not.

The department may soon send notices to such companies that have evaded tax. An inventory will be sent across to different formations and field units to keep a close watch on firms which have accumulated CERs and may trade it at a future date.

Companies earn carbon credits by reducing their greenhouse gas emissions. These credits entities can then be sold in the international market to companies in rich countries that require the credits to set off against their reduction targets under the Kyoto Protocol. India, after China, is the biggest generator of certified emission reductions. By 2012, Indian companies are expected to earn more than 600 million CERs through green-tech investments made in at least 1,500 projects, involving capital infusion of more than Rs 1.5 lakh crore.

Many of the cement and steel companies in India are among those which have traded their CERs in the international market. Recently, JSW Steel had sold some of its CERs at a rate of euro 13.50 per tonne. The price is likely to rise to euro 20 a tonne by the end of this year as the demand in Europe is likely to rise with the revival of economic activity.

Entities in China and India account for 70% of the total world carbon credit market, which is estimated to be more than $25 billion at present, and as per World Bank estimates may earn developing countries in excess of $100 billion annually by 2050.

India has generated some 75 million certified emission reductions so far as compared to China's 210 million. It has an advantage as a developing country to install modern technology that emit less of greenhouse gases. Increasingly, many of the municipal bodies in India have installed waste disposal units that earn them carbon credits, besides industrial units using green technology.


I think this ncome is chargeable to tax u/s 28 iteslf always.
So far as issue of 268A is concernbed   subesction 3 has the answer that plae of the assessee is  not getting any support form 268A.

In this judgement decision of Goa Daman & Diu Industrial Development corporation V First ITO 15 ITD 447 ( Pune) where  it is held that "though the activity of the appellant might be   activity of profit  but not activity   for profit. The assessee has no profit motive though it has earned income  in the process.  That the activities of the trust were for a public purpose   was clear from the enactment. Thus the assesee fulfilled the  conditions for exemption u/s 11."   has not been considered . Now the issue should be refrred to special bench . 

here the distinction has been brought in between activity  of Profit and activity for profit.

No body denies the issues raised by you. However  we have listened to Shri Arbind Modi on this issue. he has given very good srational

rates of tax on companiens are   @ 25 % . where to garner further revenue as the direct tax code is tax neutral.  Therefore only alternative left with the government is to  generate reveune from MAT. he  said MAt is not going to last long. His voewss were also that ineffecinet  use of assets and having long getstation time in projects which are  not in comparison with international stanadrad sof execution of the project has forced government to tax  it on asses bassis. He said there are more than 4.5 laksh companies and merely 50000  companies arepaying taxes accridng to regular method of taxation.
DTc has to be looked as a whole taxlegislature and not as indicula sections.  Therfore let us bear with this kind of taxation  for short term a and alos ensure that  Link whic  took 10 years should  have been over in 3 years. Ineefeceinet promoters and  owners should eb  penalised  as capital should chase effecient use of m national assets.


therfor emy view is that let us appreciate the views of government alos on this count.

In such cases assessee can also  ask  Ao to recast profit andloss account of securities and  ask him to give benefit of valuataion of opening stokc and  closing stock at cost or market value whihcever is less.

Invariably  where all this difference of opinion has arisen in  taxation of scurities penaty u/s 271(1) (c) is intiated. But can we  deetermine penalty  in this case and what would be tax sought to be evaded  for leving penalty. There is no change in total income.  and only clause 271(1) (c)  exp 4 will come in to play. pls discuss