MAT Loss adjustment
This query is : Resolved
krishna kumar gautam
(Querist)
23 November 2010
Under MAT, for the FY07-08, the Profit (before Depreciation) was 20 lacs. The Depreciation was Rs. 60 lacs. After Dep, there was loss of (20-60)= 40 lacs.
In this case what amount shall be c/f for next year as book loss or unabsorbed dep to be set off against book profit of next year under MAT?
I hv seen one para as below:
Where an assessee has (before allowing dep.) shown profit in any FY, but after adjustment of dep, the same results into loss, no adjustment in book profit is allowed as although there is unabsorbed dep of that year but b/f loss in this case shall be nil.
In this case what amount shall be c/f for next year as book loss or unabsorbed dep to be set off against book profit of next year under MAT?
I hv seen one para as below:
Where an assessee has (before allowing dep.) shown profit in any FY, but after adjustment of dep, the same results into loss, no adjustment in book profit is allowed as although there is unabsorbed dep of that year but b/f loss in this case shall be nil.
CA Navin Jain
(Expert)
24 November 2010
WHILE CALCULATING THE MAT LIABILITY
BOOK PROFIT WILL BE CALCULATED AFTER SET OFF THE WHICHEVER LOWER OF BOOK LOSS OR UNABSORBED DEPRECIATION.
IN UR CASE UNABSORBED DEPRECIATION IS RS. 40LACS AND BUSINESS LOSS IS NIL. THEREFORE, YOU CAN NOT SET OFF ANY AMOUNT AGAINST BOOK PROFIT.
BOOK PROFIT WILL BE CALCULATED AFTER SET OFF THE WHICHEVER LOWER OF BOOK LOSS OR UNABSORBED DEPRECIATION.
IN UR CASE UNABSORBED DEPRECIATION IS RS. 40LACS AND BUSINESS LOSS IS NIL. THEREFORE, YOU CAN NOT SET OFF ANY AMOUNT AGAINST BOOK PROFIT.
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