AO cannot make adjustment to book profits certified by auditors to be computed as per prescribed accounting norms

Advertisement Brief of the case: The Assessing Officer does not have the power to tinker with such accounts prepared as per Schedule VI and certified by the Auditors except for the adjustments permissible by Explanation to Sec 115JB to arrive at book profits. Thus, AO cannot dispute the routing of principal amount waiver through General Reserve as the same has been accepted by the auditor. Facts of the case: The case of the assessee was reopened u/s 147 to add the waiver of principal amount of loan Rs. 3,52,78,700/- to book profits which were directly credited to ‘General Reserves’...