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Book Profit Visa Vis Dividend Distribution Tax

Started by PANKAJ JAIN, October 28, 2007, 04:48:48 PM

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Dear Friends, 8)

Just wondering, whether Dividend Tax paid U/s 115-O is deductible in computing book profit under section 115JB. Is there any judicial pronouncement / clarification from CBDT?

Can't we treat tax U/s115O at par with FBT and rely on the circular No.8 for claiming the deduction of 115-0 tax from book profit?

Best Regards, ???


Dear Pankaj,

In relation to deductibility of DDT ('Dividend Distribution Tax') while computing MAT liability, you may usefully refer to following ITAT rulings:

1. Kol ITAT in Balrampur Chinni Mills 14 SOT 372 (favorable: stating DDT allowable in MAT Computation, interalia relying on CBDT Circular No.8 of 2005)

2. Chennai ITAT in Dhanlakshmi Paper Mills 105 ITD 123 (adverse: stating DDT not allowable in MAT Computation distinguishing CBDT Circular No, 8 of 2005 on which reliance was placed by assessee's counsel)

CA. Kapil Goel


I very much like this process by which latest case law on imp issues are available. It makes life so much easy. I am wondering if someone can prepare a document giving all the case law topic-wise. e.g. Bad debts - latest case is such and such....S. 115J - latest case is such and such .... deductibility of software expenditure - latest case is such and such etc etc.  This can be updated periodocally e.g monthly or bi-monthly. I am sure that it can be done by someone like you with an excellent grasp of case law. It will be very useful to entire body of professionals CAs and lawyers.




I agree that there is a need for a compilation of recent case laws because it is impossible to keep track. The ITR and CTR are a little outdated. I also want to suggest to the Association that the slideshow on the main page may be removed because it slows down the loading time (I am on dial-up). It will be sufficient to give a simple link to alert the visitor that new articles have been put up. My other suggestion is that the unreported case law, when reported, may be provided with the citation because if one is looking for a reported case, he will still visit the site and find the citation.


The Calcutta High Court (2DTR354)has affirmrd the decision of ITAT in the case of Balrampur Chini reported in (111 TTJ 230)(Kol.).



Finance Bill 2008 has resolved this issue forever........ :'(