MAT Credit utilisation

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CA Koustubh Vishnu Bhatye (Querist)

12 July 2011 Respected All,

Whether MAT Credit is optional?

For Example :

Tax liability under normal provisions of Tax = Rs.10 Lacs.

Liability under MAT = Rs.7 Lacs.

Therefore Normal tax to be considered i.e. Rs.10 Lacs.

Advance Tax = Rs.12 Lacs.

MAT Credit available = Rs. 8 Lacs.

Now the question is whether the entire MAT credit can be carried forward in subsiquent years and for the current year Refund to be claimed is Rs.2 Lacs. (Rs.10 lacs - Rs.12 Lacs.) instead of Rs.10 Lacs (ie. Rs.12 Lacs Advance Tax + Rs. 8 Lacs MAT Credit - Rs. 10 Lacs Tax Liability).

CA. Anuj Gupta

CA. Anuj Gupta (Expert)

13 July 2011 Rs. 10 lacs shall be the refund amount.

Anuj
0-9810106211

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CA Koustubh Vishnu Bhatye

CA Koustubh Vishnu Bhatye (Querist)

13 July 2011 Respected Sir,

If assessee don't want to utilise the credit due to excess tax already paid by the company,then can a company do it by carried forward entire MAT Credit?

Further, whether MAT credit is to be utilised in immediate previous year in which tax amt as per other provision exceeds the MAT, or it is optional for the assessee to choose the previous year in next 10 years for utilisation of credit.

CA. Anuj Gupta

CA. Anuj Gupta (Expert)

14 July 2011 Without going into legal interpretation of law , it shall be wise for the Company to claim refund of excess tax deposited.

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CA Koustubh Vishnu Bhatye

CA Koustubh Vishnu Bhatye (Querist)

14 July 2011 Dear Sir,

Thanks for valuable suggestion. But will you please explain me the exact meaning of Section 115JAA (5) which says that brought forward tax credit shall be allowed for any assessment year......

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