siva (ca) (49 Points)
19 August 2013Dear All,
115JB requires adjustment of Loss Brought forward or un absorbed depreciation which ever is lower.
For Eg:
Year 1: Business Loss:50L & Unabsorbed Dep:25L Total Loss:75 L
Year 2: Profit 5L (Assessee adjusted 5 L profit against Unabsorbed depreciation as it is lower for MAT Calculation)
Year 3: Profit 10 L... Now How much is the brought farward business Loss & how much is Unabsorbed depreciation?
SIVASIVA
(FCA, Future CA)
(4935 Points)
Replied 19 August 2013
50 for business loss and 15 for unabsorbed deprecn...
SIVASIVA
(FCA, Future CA)
(4935 Points)
Replied 19 August 2013
i think 10 for unabs dep as profit of rs.15 will be adjusted..
Parthamesh P Askar
(article)
(53 Points)
Replied 20 August 2013
In Year 3
Profit is 10 Lakh
Unabsorbed depreciation is 20 Lakh
Business Loss is 50 Lakh
Whichever is lower is to be adjusted in P&L for computing book profit as per 115jb. So in our case the unabsored depreciation i.e. 20lakh
so your book profit will be nil (10-10)
and unabsorbed depreciation available for set off is 10 lakh & B/f losses is 50 lakh
siva
(ca)
(49 Points)
Replied 21 August 2013
We have adjusted 5 lakhs in Year-2 as per 115JB not as per companes act right?
My question is if a company had profits in year after continous losses, whether that profit shall be adjusted against Business loss or un absorbed depreciation?
Will your answer is different if in year-1 Business loss is 25 and unabsorbed depreciation is 50?
Parthamesh P Askar
(article)
(53 Points)
Replied 22 August 2013
Yes
Then in ur recent example in 2 nd year profit should be adjusted from the unabsorbed business loss which is 25 lakh as business loss is less than depreciation
Then in third year u need to again compare the unbosrbed business loss & depreciation whichever is lower in ur case it is business loss i.e. 20 lakh . So profit will be (10-10) Nil.
and for the subsequent PY the business losses availabe to u will be 10 lakh & Unabsorbed Depreciation will be 50 lakh
GSTR 9 and 9C for FY 23-24 as amended by Notification 12/2024 dated 10th July 2024(with recording)
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