115JB

[CA.BHUPENDRASHAH]

For purposes of clause (iv) of Explanation 1 to section 115JB, extent of
reduction in respect of deduction available under section 80HHC has to be
computed strictly in accordance with provisions of section 80HHC



Tribunal was not justified in coming to the conclusion that the amount to be
reduced under clause (iv) of Explanation 1 to Section 115JB in respect of the
profits eligible for deduction under Section 80HHC has to be computed with
reference to the net profits in the profit and loss account and not according to
the profits of the business computed under the head of profits and gains of
business or profession[2010]

HIGH COURT OF BOMBAY

CIT

v.

Al-Kabeer Exports Ltd.

[CA.BHUPENDRASHAH]

one more issue !

[satyanveshi]

When I study the above mentioned case law, I understood it in quite opposite way. That is .......... deduction to be reduced u/s 80HHC from the book profits is to be computed as per the income computed under normal provisions i.e. computed as per the proceedure to arrive at the income under the head profits of business and profession but not the net profit as per profit and loss account. which view is correct. whether the above mentioned case law has supported the decision of Kerala High Court decision in the case of GTN textiles 248 ITR 372 or it differs from that case law. I am confused. please some one may clarify this issue.

[satyanveshi]

I think the head note of the case law communicate the opposite meaning. For ready reference, I am copying the conclusion of the said case law here. Please go through and arrive at right conclusion.

                "In the circumstances, while allowing the appeal, we answer the question of law by holding that the Tribunal was not justified in coming to the conclusion that the amount to be reduced under clause (iv) of Explanation 1 to Section 115JB in respect of the profits eligible for deduction under Section 80HHC has to be computed with reference to the net profits in the profit and loss account and not according to the profits of the business computed under the head of profits and gains of business or profession."

[pawansingla]

For purposes of clause (iv) of Explanation 1 to section 115JB, extent of reduction in respect of deduction available under section 80HHC has to be computed strictly in accordance with provisions of section 80HHC

•   Tribunal was not justified in coming to the conclusion that the amount to be reduced under clause (iv) of Explanation 1 to Section 115JB in respect of the profits eligible for deduction under Section 80HHC has to be computed with reference to the net profits in the profit and loss account and not according to the profits of the business computed under the head of profits and gains of business or profession

[2010] 6 taxmann.com 52 (Bom.)
HIGH COURT OF BOMBAY
CIT
v.
Al-Kabeer Exports Ltd.
ITA No. 2619 of 2010

The syncome formulations has been overruled.