Section 32AB Deduction Requires Profits per Companies Act, Not Income Tax Act Computation

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....The HC held that for claiming the 20% deduction under Section 32AB, the profits must be determined strictly in accordance with Parts II and III of Schedule VI of the Companies Act, not as per the Income Tax Act. The Court rejected the Revenue's approach of deducting the additional sugarcane price paid from the profits while computing the Section 32AB benefit. It affirmed that the provision mandates a single profit figure derived from the Companies Act accounts, disallowing any separate income computation under the Income Tax Act for this purpose. Reliance on a Supreme Court decision concerning a different issue was found inapposite. Consequently, the additional sugarcane price paid could not be treated as an expenditure to reduce profits when calculating the deduction under Section 32AB, resulting in a ruling favorable to the Assessee and against the Revenue.....