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May 2025

Sec 115JB r.w.s. 2(26): Banks constituted as ‘corresponding new banks’ and not registered under Companies Act, 2013 would not fall under the provisions of section 115JB and, therefore, tax on book profits (MAT) would not be applicable to such banks.

By Jagdish T Punjabi, Chartered Accountant
Devendra Jain & Aditya Bhatt, Advocates
Reading Time 4 mins

8. [2024] 115ITR(T) 481 (Mumbai - Trib.)

Union Bank of India vs. DCIT

ITA NO.: 3740 (MUM.) OF 2018 &424 (MUM.) OF 2020

A.Y.: 2013-14 & 2015-16 DATE: 6th September, 2024

Sec 115JB r.w.s. 2(26): Banks constituted as 'corresponding new banks' and not registered under Companies Act, 2013 would not fall under the provisions of section 115JB and, therefore, tax on book profits (MAT) would not be applicable to such banks.

FACTS

For the A.Y. 2015-16, the AO asked the assessee to furnish the computation of book profit and also required theassessee as to why provisions and contingency, debited to the profit and loss account, should not be added back for the computation of book profit u/s115JB. In response, assessee submitted that even though in computation assessee had worked out MAT on book profit, the provision of Section 115JB was itself not applicable to the assessee bank.

However, the AO rejected the assessee's plea on the ground that the amended provision of Section 115JB w.e.f. 01/04/2013 (by insertion of clause (b) to sub-section (2) to section 115JB), brings within its amb

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