The High Court held that the amount transferred by the assessee to the Statutory Reserve Fund in compliance with the mandatory provisions of Section 45IC read with Section 45Q of the Reserve Bank of India Act, 1934, is not an allowable deduction in computing the assessable income under the provisions of the Income Tax Act, 1961. This decision aligns with the Court's earlier ruling for the same assessee in other assessment years. The Court concluded that the reserve fund represents retained profits for business use and does not qualify as a deductible expense under regular income computation or book profit computation u/s 115JB. Consequently, the orders of the lower authorities were upheld, and the issue was decided in favor of the revenue department.
The High Court held that the amount transferred by the assessee to the Statutory Reserve Fund in compliance with the mandatory provisions of Section 45IC read with Section 45Q of the Reserve Bank of India Act, 1934, is not an allowable deduction in computing the assessable income under the provisions of the Income Tax Act, 1961. This decision aligns with the Court's earlier ruling for the same assessee in other assessment years. The Court concluded that the reserve fund represents retained profits for business use and does not qualify as a deductible expense under regular income computation or book profit computation u/s 115JB. Consequently, the orders of the lower authorities were upheld, and the issue was decided in favor of the revenue department.
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 4816 
Join Channel 
