2008 (1) TMI 27

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....rwarded depreciation was not to be taken into account while working out the book profits for the purposes of Section 115 J of the Income-tax Act., 1961 ? (b)  he directed the AO to determine the book profit at Rs.19,09,097/- for the purpose of Section 115 J as against the book profit determined by the assessee at a negative figure of Rs.1,64,54,112/- ?" 2. Briefly the facts are that for the assessment year 1988-89, on perusal of the assessment record, the Commissioner of Income Tax found that the assessee Company had worked out book profits at Rs.19,09,097/-. It was also observed that the Assessing Officer had adjusted brought forward unabsorbed depreciation against the current income and allowed carry forward of the remaining un....

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....xcept the notional loss after deduction of depreciation. He also observed that the brought forward loss was, in fact, nil against substantial brought forward deprecation both as per straight line method and WDV method. He, therefore, held that as there was no business loss or the loss was less than brought forward unabsorbed depreciation, the brought forward depreciation was not to be taken into account while working out the book profit for the purpose of section 115-J of the I.T. Act, 1961. In the process he also referred to the provisions of section 205 (b) of the Companies Act, 1956 and observed that the Companies Act differentiated between the actual loss and loss after depreciation and that the assessee's contention that the loss in it....

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....avouring the assessee had to be preferred. It also observed that the case of the assessee was supported by the judgment of the Tribunal reported in 39 ITD 432. The Tribunal, therefore, directed the AO to deduct the amount of depreciation and on the resultant figure compute 30% of the profits u/s.115-J of the I.T. Act for the asstt. Year 1989-90. 4. The learned counsel submitted that the Tribunal has accepted the claim of the assessee in relation to asstt. Year 1989-90. He further submitted that though a reference has been made to the Hon'ble High Court of Punjab and Haryana, the Tribunal should take a consistent view for the sake of judicial discipline. It is also relevant to mention that the assessee also cited various judgments in his ....