High Court Of Karnataka
CIT Vs. M/S Horizon Capital Ltd.,
ITA NO. 434 Of 2010,
Misc. CVL 6629 of 2011
Date Of Order : 24/10/2011
MAT Assessment on book profits u/s 115 JB the benefit of rebate u/s 88 E is available to assessee as same is in nature of assurance and promise given to tax payer.
Assessee is liable to pay securities transaction tax when he enters into securities transaction. Tax is payable simultaneously after realising the consideration. However, if that transaction is included in the total income of the assessee where the total income is assessed either under the provisions of the Act or under Section 115 JB when tax chargeable on such income is arrived at, he is given the benefit of tax deductions of the amount, which he has paid under section 88 E by virtue of Section 87. When under Section 82 A, the assessee is made liable to pay tax with an assurance that it will be deducted and 87 of the Act gives effect to such promise made under the statute. That is the reason why the word used is rebate. The amount paid is handed back to the assessee. In other words, payment of tax twice on the same income is avoided.
Therefore The contention that this benefit is not available to assessee whose total income is assessed u/s 115 JB has no substance. In other words, when the total income is assessed u/s 115 JB has no substance. In other words when the total income is assessed and the tax chargeable is computed, it is from that tax which is chargeable, the tax paid under section 88 is given deduction, by way of rebate, under section 87 of the Act. This is the legislative intent. That is a promise to give deduction of the tax already paid. This is the mode in which tax already paid is handed back at the time of final computation.