TaxTMI 
TaxTMI 
2004 (6) TMI 285
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....book profit under s. 115JA of the IT Act. Further, he failed to appreciate that provisions of s. 115JA of the Act are deeming provisions and therefore, have to be interpreted strictly and since as per cl. (a) of Explanation to the above section, only amount of income-tax paid or payable under the provision therefore is required to be added to the profit as per the P&L a/c, it cannot be said that for the purpose of above section interest paid to IT Department is also to be added. Further, in view of definition of term 'tax' given in s. 2(43) of the IT Act and also in view of number of other provisions of the Act, interest payable is distinct and separate from the tax. (ii) That the Hon'ble CIT(A) has erred in holding that the AO has....
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....the Act. Besides this, interest under s. 234B has also been charged from the assessee. 3. The learned CIT(A) approved the action of the AO after careful consideration of the written submissions and precedents referred before him by the assessee. He was of the view that Expln. (a) of s. 115JA requires income-tax paid or payable under the provisions thereof is to be added back. He stated that a large number of judgments are available in the context of s. 40(a)(ii) which is similar to the provision of Expln. (a) to s. 115JA. The jurisdictional High Court of Delhi in the case of Bharat Commercial Industries Ltd. vs. CIT (1985) 45 CTR (Del) 1 : (1985) 153 ITR 275 (Del) following the Supreme Court decision in Mahalakshmi Sugar Mills vs. CIT (1....
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....Act. Tax, penalty and interest are different concepts under the IT Act. The definition of "tax" under s. 2(43) does not include penalty or interest. Similarly, under s. 156, it is provided that when any tax, interest, penalty, fine or any of other sum is payable in consequence of any order passed under this Act, the AO shall serve upon the assessee a notice of demand as prescribed. The provisions for imposition of penalty and interest are distinct from the provisions for imposition of tax." 6. Another decision relied is Bhor Industries Ltd. & Ors. vs. CIT (1961) 42 ITR 57 (SC) wherein it has been held as under: "The words of the sub-section are clear to show that interest as interest is added to the tax as determined. There is n....
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.... Ltd. vs. CIT (1979) 116 ITR 620 (Kar) wherein it has been held as under: "The concepts of tax, penalty and interest are not only the same but also separate and distinct. These three expressions are, in fact, used in s. 29 of the Indian IT Act, 1922, as well as in s. 156 of the Act, to denote that each is distinct and independent of the other. Hence, tax cannot be equated to penalty or interest." 10. The learned counsel in respect of prima facie adjustment has relied upon the decision of Delhi High Court in the case of Samtel Color Ltd. vs. Union of India & Ors. (2002) 177 CTR (Del) 289 : (2002) 258 ITR 1 (Del) and in respect of additional tax reliance has been placed on the decision of CIT vs. Hindustan Electro Graphites Ltd. (....
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.... made under s. 115JA in respect of any interest paid or payable debited to the P&L a/c in order to compute book profit though the expense is not allowed as deduction while calculating/determining taxable income, with reference to s. 40(a)(ii) of the IT Act. The Kerala High Court in Fertilisers & Chemicals Travancore Ltd. has observed that Expln. (a) of s. 115JA of the Act mentions only the amount of income-tax paid or payable. That does not include interest. Insofar as interest on income-tax is not mentioned in this section, this cannot be added under s. 115JA of the Act. It, therefore, came to the conclusion that the addition of interest on income tax cannot be made. However, in the impugned order, the learned CIT(A) relied on the decision....