AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1146
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....IFR) on 09.02.2005 and State Bank of India was appointed as Operating Agency to formulate a revival scheme. The scheme of revival of the assessee company was sanctioned by BIFR vide order dated 08.09.2008 (SS-08). Subsequently, the net worth of company became positive as per Audited Balance Sheet (ABS) as on 31.03.2009 and provisional balance sheet as on 30.03.2010. In such circumstances, the assessee requested BIFR to discharge it from the purview of SICA/BIFR. Accordingly, vide order dated 16.06.2010, BIFR held that the company ceased to be a sick industrial company and the revival of the company was sustainable. Following is the operative part of the order passed by BIFR on 16.06.2010. "4.4 Having considered the submissions made in the hearing and materials on the record, the Bench issued the following directions:- (a) The company M/s. Supertex Industries Ltd ceases to be a sick industrial company, within the meaning of section 3(1)(o) of the SICA as its net worth has turned positive as per ABS as on 30.03.2009 and as per the Provisional Balance Sheet as on 31.03.2010. The revival of the company is sustainable. It is therefore discharged from the purview of SIC....
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....ut of the provisions of SICA as per order dated 16.06.2010 passed by the BIFR and therefore, the assessee could not seek exemption from the provisions of section 115JB of the Act. The learned CIT(A) has found that the assessee having come out of the provisions of SICA in A.Y. 2008-09, was not entitled to such exemption in A.Y. 2012-13 to which present appeal relates. 7. Aggrieved by the impugned addition made the assessee has filed the present appeal on the following ground: "On the facts and under the circumstances of the case and in law, the Learned Commissioner of Income Tax (Appeals) erred in upholding the Assessing Officer's Action in computing tax of Rs. 1,99,395/- by applying provisions of MAT u/s. 115JB, without appreciating the fact that the appellant was a sick company under BIFR and accumulates losses is still not recouped. Hence, it is exempt from provision of section 115JB of the Income Tax Act, 1961 even though the net worth of the company has become positive" 8. Earlier the appeal was dismissed by a Co-ordinate Bench vide order dated 20.09.2022 in ITA No. 4649/Mum/2018. The assessee filed Miscellaneous Application No.433/Mum/2023 seeking rectification ....
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.... can be seen that scheme of revival of the assessee company was sanctioned by BIFR on 08.09.2008 (SS-08) and the assessee was discharged from the provisions of BIFR vide order dated 16.06.2010. Thus, the company was a sick company from 08.09.2008 to 16.06.2010. 14. In the present appeal we are concerned with clause 20E of SS-08 which reads as under: "20. RELIEFS/CONCESSIONS: CUT-OFF-DATE 01.04.2007 A. SBI, IDBI and ICICI ... B. U.T. OF DADRA AND NAGAR HAVELLI. ... C. ELECTRICITY BOARD (U. T. OF DADRA AND NAGAR HAVELLI) ... D. COMMERCIAL TAXES DEPT. ... E. CENTRAL GOVERNMENT D.I.T i. To consider to exempt from the provisions of Sections 41(1), 43(B), 72, 79, 80 read with 139 and Section 115-JB of Income Tax Act, 1961. F. C.P.F. AUTHORITY: ... G. ESIC ... H. WORKERS ... I (a) SUNDRY CREDITORS ... J. SEBI: ... K. BSE: ... L. EXISTING SHAREHOLDERS: ... (Emphasis supplied) This clause has to be read along with the directions issued by BIFR da....
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.... that cannot enlarge the ambit of the scheme SS-08 and the order passed by the BIFR/AAIFR. 17. It is significant to note that after the draft scheme was formulated by BIFR, the Directorate of Income Tax (Recovery) had made certain submissions. Summary record of the hearing as contained in paras 8 and 10 before the BIFR dated 08.09.2008 reads as under: "8. The representative of Directorate of Income Tax (Recovery) submitted that the word "to consider" be added before the reliefs sought from Directorate of Income Tax (Recovery) vide Para 20 (E) (i) of Page 21 of DRS. Similarly, sub-Para (ii) Para 20 (E) of Page 21 of DRS may be deleted as it does not relates to the Income Tax Department. The Bench agreed with the request of the representative. 9. ... 10. Having considered the facts on record and the submissions made at today's hearing, the Bench noted that there was a broad agreement on the provisions contained in the Draft Rehabilitation Scheme circulated vide order dated 3.7.2008, with the changes mentioned below. Taking note of the above, the Bench sanctioned the scheme (hereinafter called the 'sanctioned scheme') in exercise of powers con....
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....he provisions of SICA/BIFR. In order to contend that the exemption u/s. 115JB continues even thereafter, the assessee has placed reliance on para 4.4(b) of the order dated 16.06.2010, which in our humble view is misplaced. 20. In this regard it is also relevant to look at the provisions of clause (vii) to Explanation 1 to section 115JB which is applicable to the present case that reads as under - 115 JB - Special provision for payment of tax by certain companies. (1) & (2) **************** Explanation 1.-For the purposes of this section, "book profit" means the profit as shown in the statement of profit and loss for the relevant previous year prepared under sub-section (2), as increased by- (a) to (k) ***************** or if any amount referred to in clauses (a) to (i) is debited to the statement of profit and loss or if any amount referred to in clause (j) is not credited to the statement of profit and loss, and as reduced by,- (i) to (vi) *************** (vii) the amount of profits of sick industrial company for the assessment year commencing on and from the assessment year relevant to the previous year in which th....
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....he BIFR being discharged, the Department ought to be in a position to recover its dues de hors the concessions incorporated in the sanctioned scheme. We find that the case clearly turned on its own facts in which the department was seeking withdrawal of the concessions specifically incorporated in the scheme after the company became net worth positive. In the present case, there is no claim for withdrawal of any concessions granted. Thus, in our humble opinion, the present case is clearly distinguishable on facts. 22. Upon a query being made as to what happened to the subsequent assessment years, the learned AR submitted that the exemption from section 115JB was claimed by the assessee till A.Y. 2019-20. It is submitted that there were two assessments after current A.Y. 2012-13 i.e. in A.Y. 2014-15 and A.Y.2019-20, out of which a similar issue did not arise for consideration for A.Y. 2019-20. In so far as A.Y. 2014-15 is concerned the assessee had claimed in its computation of income, set off of brought forward losses of Rs. 1,38,02,500/- from the current year business profit. It was seen that the business loss was prior to A.Y. 2006-07 and could not be allowed which had already....