MAT Provisions U/s. Section 115JB not applicable to sick company

B.V. Reddy Transports Pvt. Ltd. Vs Asst. (ITAT Hyderabad)

There is no dispute with the fact that the company has negative networth and has become sick under the repealed Act- Sick Industrial Companies (Special Provisions) Act, 1985. Issuance of certificate u/s. 17 of the SICA does not arise as the Board stand dissolved consequent to repeal of the Act. So, the insistence of AO and the Ld.CIT(A) for a certificate under that Act is not proper. Since the provisions of Section 115JB have not been amended, to that extent the repealed SICA Act is applicable so it has to be applied. Therefore, under these circumstances, it is to be considered that assessee is covered by Section 17 of SICA and therefore, the company is exempt from the provisions of Section 115JB, being a sick company.

There is merit in assessee’s contention but that becomes academic only as there are contradicting views on this subject and we need not go into that issue for the simple reason that assessee being a sick company, provisions of Section 115JB are not applicable