Calculation of book profit for the purpose of Minimum Alternate Tax has been eased for companies against whom corporate insolvency resolution has been admitted by the National Company Law Tribunal, the government said today.
The new rules will be effective for the financial year ending March 31, 2018. The government will allow for the amount of total loss brought forward, including unabsorbed depreciation to be reduced from the book profit for the purpose of levy of MAT under section 115JV of the Income Tax Act,1961, an official statement said.
As per the existing provision companies are only allowed for the amount of loss brought forward or unabsorbed depreciation, whichever, is less to be reduced from the book profit.
The ease of norms follows representation from stakeholders who argued hardships due to restriction in allowance of brought forward loss for the computation of book profit.
The government will make appropriate legislative amendment in this regard, the statement said.
Also Read: China Development Bank Withdraws Insolvency Plea Against RCom
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