M.Lokesh (Student) (95 Points)
03 May 2010HELLO FRIENDS,
TAX TO BE PAID BY THE COMPANY IS HIGHER OF THE FOLLOWING :
(1) TAX PAYABLE AS PER IT ACT,
(2) TAX PAYABLE AS PER PROVISIONS MENTIONED U/S.115 JB
SUPPOSE AN UNDERTAKING HAS EOU EXEMPTION.IN THIS SITUATION TAX PAYABLE UNDER IT ACT WILL BE RS.NIL/- NOW BY DOUBT IS WHETHER THE COMPANY HAS TO PAY TAX AS PER SEC.115JB(AS THIS IS HIGHER) ?
IF YES CAN U GIVE REFERENCE FOR THE SAME.
Amir
(Learner)
(4016 Points)
Replied 03 May 2010
Dear Lokesh,
Yes, Tax as per MAT shall be payable in this case where Companies actual liability because of area based deduction like 10A/10B/80IA etc is "Nil".
As far as reference goes I would say "Explanation" - provides a method to calculated Book Profits.Further the itrems to be added & dreduced are exaustive & apart from the items listed in the explnation no other iotem is to be added /reduced..
Since EOU exemption is no where excluded therefore Tax has to be paid in this case.
Attention is invited to this amendment made in the explanation to Sec 155JB -
Words “section 10A or section 10B or” omitted by the Finance Act, 2007, w.e.f. 1-4-2008.
PRAVEEN KUMAR
(MBA (Finance) B.Com.(P))
(3443 Points)
Replied 03 May 2010
yes, MAT Shall Applicable.
Amir Bhai, I must appreciate your reply, I am visitiing this CA Club regularly from March 2007 onwards and i have not seen anybody giving reply so promptly in details on regular basis.
it is really amazing. keep it up bro....
M.Lokesh
(Student)
(95 Points)
Replied 03 May 2010
Suppose if the Company is situated in SEZ then is it liable to pay tax as per MAT?
Can u clarify clearly the difference between SEZ & EOU?
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