MAT adjustment for section 10B income depends on profit and loss credit, not on claiming it in normal computation.

For assessment year 2005-06, income relatable to section 10B could be adjusted against book profit under section 115JB where the amount was credited to the profit and loss account. The decisive factor was the statutory wording linking the MAT adjustment to credit in the profit and loss account, not whether the assessee had also claimed the deduction in the normal computation of income. On the undisputed facts, the assessee had made the relevant credit and claimed the adjustment consistently with the then-existing provision, so the lower authorities' view was not shown to be perverse or based on misreading. The adjustment was therefore permissible and the Revenue's challenge failed.

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Issues: Whether, for assessment year 2005-06, the amount relatable to section 10B could be reduced from book profit under section 115JB when it was credited to the profit and loss account, even though it was not claimed in the normal computation of income.

Analysis: The relevant explanation to section 115JB provided that book profit meant the net profit as shown in the profit and loss account as increased by the amount of income to which section 10, section 10A, section 10B, or section 11 applied, if such amount was credited to the profit and loss account. The decisive factor was therefore the credit in the profit and loss account, not whether the deduction had also been claimed in the normal computation. On the undisputed facts, the assessee had credited the income to the profit and loss account and claimed the adjustment in the MAT computation in accordance with the then-existing statutory language. The concurrent view of the lower authorities was that this did not involve any perversity or misreading of the provision.

Conclusion: The adjustment was permissible and the Revenue's challenge failed.

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