AJANTA PHARMA LTD. versus COMMISSIONER OF INCOME TAX-9, MUMBAI

AJANTA PHARMA LTD. versus COMMISSIONER OF INCOME TAX-9, MUMBAI

For computation of 'book profits' under Section 115JB, the reduction must be the full export profits as per Section 80HHC(3), not the reduced percentage under Section 80HHC(1B); Section 115JB is a self-contained code and cannot be curtailed by the proportional deduction mechanism of Section 80HHC(1B).

Parties
Appellant Assessee: Ajanta Pharma Ltd.; Respondent Department: Commissioner of Income Tax-9, Mumbai
Jurisdiction
India
Judgment Date
09 September 2010
Procedural Posture
Civil Appeal / Final, Supreme Court Decision
Outcome
Appeal allowed
Legal Topics
Minimum Alternate Tax, Export Incentives, Computation of Book Profits, Section 115 JB, Section 80 HHC
Income Tax Minimum Alternate Tax Export Incentives Computation of Book Profits Section 115 JB Section 80 HHC

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Parties

Ajanta Pharma Ltd.

Appellant Assessee

Commissioner of Income Tax-9, Mumbai

Respondent Department

Procedural Posture

Civil Appeal / Final, Supreme Court Decision

Legal Issues

  1. 1 Whether, for determining 'book profits' under Section 115JB of the Income Tax Act, 1961, reduction should be the amount of profits eligible for deduction under Section 80HHC or the amount of deduction under Section 80HHC

Ratio Decidendi

For computation of 'book profits' under Section 115JB, the reduction must be the full export profits as per Section 80HHC(3), not the reduced percentage under Section 80HHC(1B); Section 115JB is a self-contained code and cannot be curtailed by the proportional deduction mechanism of Section 80HHC(1B).

Court Disposition

Appeal allowed

Orders

  • Impugned decision of Bombay High Court dated 07.05.2009 set aside
  • Judgment of Tribunal restored