Section 115JB(2)(b) — the law in short
What the courts have decided on section 115JB(2)(b), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Statutory position — s.115JB(2): the two routes to book profit, and why a bank's or insurer's MAT computation is not made on the Schedule III footing
CBDT Circulars & InstructionsCuts both ways
I am computing MAT for a banking company. Do I recast its accounts into the Schedule III format of the Companies Act, or do I start from the accounts it actually prepares under the Banking Regulation Act?
You start from the accounts it actually prepares under its own governing Act. Section 115JB(2) is in two clauses. Clause (a) applies to a company OTHER THAN one referred to in clause (b) and requires it to prepare its statement of profit and loss for the relevant previous year in accordance with the provisions of Schedule III to the Companies Act, 2013. Clause (b) applies to a company to which the SECOND PROVISO to sub-section (1) of section 129 of the Companies Act, 2013 is applicable — that proviso disapplies the ordinary financial-statement form to any insurance or banking company, any company engaged in the generation or supply of electricity, and any other class of company for which a form of financial statement has been specified in or under the Act governing it — and requires such a company to prepare its statement of profit and loss in accordance with the provisions of the Act governing it. A MAT computation for a bank built on the Schedule III footing is therefore built on the wrong base.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.
