Query relating to Sec 88E and Sec 115JB

This query is : Resolved

CA CS Akashdeep Singh (Querist)
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07 December 2008 Sir

One of my client(X Ltd.) has a business income from taxable security transaction. Current issue is relating to Sec 115 JB and Sec 88E.

Facts

In Sec 115JB, if "tax on total income" is less than 10% of book profit, then 10% of book profit shall be treated as tax which he has to pay.

In Sec 88E, if any individual has a business income from taxable security transaction, STT paid by him is allowable as deduction from tax on total income

Issue

In Sec 115JB, which "tax on income" is taken to compare with 10% of book profit?

Solution: tax after or before deduction u/s 88E

Regards

Akashdeep Singh

CA Mani

CA Mani (Expert)
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07 December 2008 Tax on total income is before deduction u/s.88E.

Tax on total income is tax calculated at the applicab;e slab rates.
Tax on TI (-) S.88E, Adv tax etc. = Tax payable.

So, compare befor 88E.