2000 (7) TMI 11

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....elivered by J. B. KOSHY J.---The petitioners are questioning the constitutional validity of section 115J of the Income-tax Act, 1961. The above section was introduced by the Finance Act, 1987 (Act No. 11 of 1987). It was introduced as a special provision relating to certain companies for taxation of companies whose total income is computed less than 30 per cent. of their book profits. According....

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....vy of income-tax under section 143(1A) is illegal and liable to be struck down. Consequently, it is submitted that, levy of additional tax under section 143(1A) is also illegal and no interest can be charged under section 234B on the above. The object of the insertion of section 115J of the Income-tax Act, 1961, was to ensure levy of minimum tax on what are known as "prosperous zero tax compani....

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....ection 115J, The very object of the provisions of section 115J is to tax such companies which are making huge profits and also declaring substantial dividends, but are managing their affairs in such a way as to avoid payment of income-tax, as a result of various tax concessions and incentives and for that purpose, the taxable income is determined under sub-section (1) of section 115J. An assessee ....

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....ally competent to take away or restrict or limit such allowances for a definite purpose. Various concessions and allowances are given as per various provisions enabling the companies to arrange their tax affairs in such a way as to become "zero tax" companies and the Legislature by this section restricted or curtailed or limited such concessions to the extent as provided in section 115J so that....