Case Law Details
DCIT v. Bharat Aluminium Company Ltd (ITAT Delhi)- The Delhi Tribunal in this case has held that interest for deferment of advance tax is leviable under Section 234C of the Act where there is a shortfall in payment of advance tax while computing ‘book profit’ under the existing MAT provision under Section 115 JB of the Act.
The Supreme Court in the decision of Kwality Biscuits Ltd held that interest cannot be leviable under Section 234 B and 234 C of the Act, in the case of assessment done on the basis of book profits under Section 115 J of the Act, since the entire exercise of computing income under Section 115J of the Act can only be done at the end of the financial year and relevant provisions of the Act cannot be made applicable until and unless the accounts are audited and balance-sheet is prepared.
In view of the specific provisions of Section 115JB(5) of the Act and in view of the Supreme Court decisions in the case of Rolta India Ltd and Saurashtra Kutch Stock Exchange Limited, the Karnataka High Court in Jindal Thermal Power Co Ltd and Sankala Polymers P Ltd and the Madras High Court in Geetha Ramakrishna Mills P Ltd, interest under Section 234 C of the Act is leviable. The Delhi Tribunal observed the difference between the erstwhile MAT provisions under Section 115 J of the Act and existing MAT provisions under Section 115J B of the Act where in the latter provisions it has been provided that all other provisions of the Act shall apply to every company which is subject to MAT provisions. Therefore, in view of the Delhi Tribunal, interest under Section 234 B and 234 C would be applicable if there is a shortfall in the payment of advance tax computed under Section 115 JB of the Act.
INCOME TAX APPELLATE TRIBUNAL, DELHI
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