The Tribunal held that capital gains from transfer of asset by Holding Company to its Wholly Owned Subsidiary which is exempt from tax under section 47(iv) of the Act is not ‘income’ as per section 2(24)(vi) of the Act and therefore cannot be included in computation of book profit for MAT purposes. Shivalik Venture Pvt Ltd v DCIT – 60 taxmann.com 314 (Mumbai – Trib)

The assessee received an amount of Rs.43 lakhs being remission of liability of ING Vysya Bank Ltd. The assessee has prepared its P&L A/c by including this amount as income. The assessee submitted before the AO that this remission of the liability was on account of principal amount of loan and therefore, the same is not in the nature of income which can be considered as part of the book profits u/s 115JB of the Act. Held that Even a non-taxable capital receipt credited to the P&L A/c cannot be excluded while computing the book profits. The fact that the notes to the A/cs state that the receipt is on capital account is irrelevant. B & B Infotech Ltd vs. ITO (ITAT Bangalore) 07-10-2015

Wealth tax liability can not be added back to book profits u/s 115JB under Explanation I(a) - Microlabs Ltd [2015] 62 taxmann.com 60 (Bangalore - Trib.) MARCH 5, 2015

Disallowance u/s 14A computed with Rule 8D to be added to computation of book profits under Explanation I(f) “ amount of expenditure relatable to any income to which section 10…..apply”. Held by ITAT that it is same as “expenditure incurred by the assessee in relation to Income which does not form part of total income”. Assessee plea that Explanation 1(f) is very specific and only direct expenditure should be disallowed rejected following paras 29 and 30 of Shobha developers 58 taxmann.com 107(Bang.) - Microlabs Ltd [2015] 62 taxmann.com 60 (Bangalore - Trib.) MARCH 5, 2015

While adding Long term capital income under section 10(38) for the purpose of MAT calulation u/s 115JB, indexation can not be done

Dharmayug Investments Ltd. [2015] 58 taxmann.com 116 (Mumbai - Trib.) 10-06- 2015