https://www.taxtmi.com/highlights?id=90387 The HC held that the addition of the provision for doubtful debts/advances to book profit under clause (b) of Explanation to Section 115JA was erroneous. The provision for doubtful debts does not constitute a "reserve" and thus cannot be added back to book profit as per the Explanation. The Court noted that clause (g) of Explanation to Section 115JA, introduced effective 1 April 1998, specifically addresses provisions for diminution in the value of assets, distinguishing them from reserves. Since the relevant assessment year preceded this amendment, the amount set aside as provision for doubtful debts could not be added to book profit under clauses (b) or (c). Consequently, the HC set aside the orders of the AO, CIT(A), and ITAT that had ad..... en-us Fri, 11 Jul 2025 08:39:54 +0530 Fri, 11 Jul 2025 08:39:56 +0530 TaxTMI RSS Generator https://www.taxtmi.com/highlights?id=90387 The HC held that the addition of the provision for doubtful debts/advances to book profit under clause (b) of Explanation to Section 115JA was erroneous. The provision for doubtful debts does not constitute a "reserve" and thus cannot be added back to book profit as per the Explanation. The Court noted that clause (g) of Explanation to Section 115JA, introduced effective 1 April 1998, specifically addresses provisions for diminution in the value of assets, distinguishing them from reserves. Since the relevant assessment year preceded this amendment, the amount set aside as provision for doubtful debts could not be added to book profit under clauses (b) or (c). Consequently, the HC set aside the orders of the AO, CIT(A), and ITAT that had ad..... Highlights Income Tax Fri, 11 Jul 2025 08:39:54 +0530 https://www.taxtmi.com/highlights?id=90387