Minimum Alternate Tax

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CA Anshu Agarwal (Querist)
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24 October 2009 Profit as per P&L a/c = 200000.00

Depreciation charged to P&L = 15000.00
amount credited to P&L from
Revaluation Reserve = 6000.00
Depreciaiton on WDV basis @ 10%:
opening WDV of asset = 150000.00
Rs.50000.00 included in WDV for revaluation.

For the purpose of section 115JB of the income tax act, what will be Book Profit?

CA Anshu Agarwal

CA Anshu Agarwal (Querist)
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24 October 2009 is the following working is correct:-
Book Profit: = 200000.00
Add: Depreciaiton = 15000.00
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215000.00
Less:
amount of reserve (revaluation reserve) credited to P&L a/c [explanation (i) to section 115JB(2)] = 6000.00
amount of depreciation excluding the deprecitaion on account of revaluation = 10000.00
amount of revaluation reserve credited to P&L a/c not exceeding deprecitaion on account of revaluation = 5000.00
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194000.00
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HARI K V

HARI K V (Expert)
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25 October 2009 Superb... Very Well done.. It is absolutely correct. U can also refer to the Illustration given in Dr. Vinod k. Singhanias' Direct Taxes.

CA Anshu Agarwal

CA Anshu Agarwal (Querist)
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25 October 2009 is double reduction on account of credit to P&L from revaluation a/c is permissible?

HARI K V

HARI K V (Expert)
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25 October 2009 Anshu,
It is not double reduction... its different on either cases...
1st reduction, u ve done is for the credit u ve made to PnL
2nd, being the dep on rev...

HARI K V

HARI K V (Expert)
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25 October 2009 u still hav a doubt or is it cleared?

CA Anshu Agarwal

CA Anshu Agarwal (Querist)
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25 October 2009 ist reduction is for withdraw from revaluation reserve as whole amount.

2nd reduction is for withraw from revaluaiton reserve as amount relatable to depreciation on account of revaluation.

am i right?

HARI K V

HARI K V (Expert)
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26 October 2009 yes.

CA Anshu Agarwal

CA Anshu Agarwal (Querist)
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27 October 2009 so it is double reduction on account of amount of revaluation reserve credited to P&L a/c relatable to depreciation on amount of revaluation.