TaxTMI 
TaxTMI 
2008 (8) TMI 601
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.... of Finance Bill, 2000, by which the said section has been introduced that there is no mention of relief to be allowed under section 91 whereas other reliefs have been specifically mentioned. Therefore, by allowing credit for tax paid in foreign country by minimum alternate tax determined as payable under section 115JB, the intention of Legislature in introducing the section gets violated as the same was introduced with the intention that the company must pay at least 7.5 per cent of its book profit as taxes. The CIT further noted that it does not amount to double taxation of the same income in India as well as in Bhutan as the relief under section 91 is admissible to the assessee from tax payable on the income computed as per provision of sections 28 to 43D of the Income-tax Act, 1961. Similar observation noted by the CIT for assessment year 2002-03 that the Assessing Officer has wrongly allowed relief of Rs. 14,34,485 while computing tax payable under section 115JB for tax paid by the assessee in Bhutan in making assessment under section 143(3). The CIT found in both the years the orders of the Assessing Officer are erroneous and prejudicial to the interests of the revenue. 4. T....
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....rightly held that orders of Assessing Officer is erroneous insofar as it is prejudicial to the interests of the revenue. Relief under section 91 is admissible to the assessee from tax payable as per the provisions of sections 28 to 43D of Income-tax Act. 6. We have heard the learned representatives of the parties and record perused. The issue under consideration is pertaining to section 263 and section 91. The said sections read as under: - "263.(1) The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by the Assessing Officer is erroneous insofar as it is prejudicial to the interests of the revenue, he may, after giving the assessee an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment, or cancelling the assessment and directing a fresh assessment. Explanation.-For the removal of doubts, it is hereby declared that, for the purposes of this sub-section,- (a )an order passed on or before or after 1-6-1988 by the Assessing Offi....
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....ax payable by him of a sum calculated on such doubly taxed income at the Indian rate of tax or the rate of tax of the said country, whichever is the lower, or at the Indian rate of tax if both the rates are equal. (2) If any person who is resident in India in any previous year proves that in respect of his income which accrued or arose to him during that previous year in Pakistan he has paid in that country, by deduction or otherwise, tax payable to the Government under any law for the time being in force in that country relating to taxation of agricultural income, he shall be entitled to a deduction from the Indian income-tax payable by him- (a )of the amount of the tax paid in Pakistan under any law aforesaid on such income which is liable to tax under this Act also; or (b)of a sum calculated on that income at the Indian rate of tax; whichever is less. (3) If any non-resident person is assessed on his share in the income of a registered firm assessed as resident in India in any previous year and such share includes any income accruing or arising outside India during that previous year (and which is not deemed to accrue or arise in India) in a country with which there is no ag....
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....initiation of proceedings by him will be illegal and without jurisdiction. The power of suo motu revision under sub-section (1) is in the nature of supervisory jurisdiction and the same can be exercised only if the circumstances specified therein exist. Two circumstances must exist to enable the Commissioner to exercise power of revision under this sub-section, viz. (1) the order is erroneous; (2) by virtue of the order being erroneous prejudice has been caused to the interests of the revenue. It has, therefore, to be considered firstly as to when an order can be said to be erroneous. We find that the expressions 'erroneous', 'erroneous assessment' and 'erroneous judgment' have been defined in Black's Law Dictionary. According to the definition, 'erroneous' means 'involving error; deviating from the law'. "Erroneous assessment" refers to an assess- ment that deviates from the law and is, therefore, invalid, and is defect that is jurisdictional in its nature, similarly, 'erroneous judgment' means one rendered according to course and practice of court, but contrary to law, upon mistaken view of law, or upon erroneous application of legal principles. 6.2 An order cannot be termed as ....
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....ispute that the assessee is entitled to relief under section 91 of the Act. The scheme of the Act is that section 115JB is applicable wherein the case of an assessee, being a company, the income-tax payable on the total income as computed under this Act in respect of any previous year is less than 7.5 per cent of its book profit, 7.5 per cent book profit shall be deemed to be the total income of the assessee. This can be explained by an illustration. Suppose an assessee having income in India is 'x' and income outside India is 'y'. In normal calculations of income from sections 28 to 43D, the income i.e., 'x' + 'y' is less than the income 'z'; as per calculation under section 115JB then income 'z' is to be taken. In the case under consideration 'x' + 'y' is less than 7.5 per cent so income according to section 115JB is taken which is more than income 'x' + 'y'. On consideration of above guidelines laid down by the Apex Court in the above decisions and the ratio laid down by the Calcutta High Court in the case of Jeewanlal (1929) Ltd. (supra), we find that income in Bhutan has been considered while invoking section 115JB, once Bhutan income has been considered for the purpose of thi....