Alternate Minimum Tax
33.1 The provisions of section 115JC of the Income-tax Act,
before its amendment by the Act, provide that where the regular income tax
payable by a person, other than a company, for a previous year is less than the
alternate minimum tax for such previous year, the person would be required to pay income
tax at the rate of eighteen and one half per cent on its adjusted total income.
The section further provides that the total income shall be increased by
deductions claimed under Part C of Chapter VI-A, and under section 10AA to arrive at
adjusted total income.
33.2 Under the Income-tax Act, the investment linked
deductions have been provided in place of profit linked deductions. These profit
linked deductions are subject to alternate minimum tax (AMT).
33.3 Accordingly, with a view to include the investment
linked deduction claimed under section 35AD in computing adjusted total income for
the purpose of calculating alternate minimum tax, section 115JC has been amended to
provide that total income shall be increased by the deduction claimed under
section 35AD for the purpose of computation of adjusted total income. The amount
of depreciation allowable under section 32 shall, however, be reduced in
computing the adjusted
total income.
Example:
Total income : Rs. 60
Deduction claimed under Chapter VI-A : Rs. 40
Deduction claimed under section 35AD on a capital asset : Rs. 100
Computation of adjusted total income for the purposes of AMT
Total income : Rs. 60
ADDITIONS
(i) deduction under Chapter VI-A (on non-specified business)
: Rs. 40
(ii) deduction under section 35AD(on specified business)Rs.
100
LESS: depreciation under section 32 Rs. 15 : Rs. 85
Adjusted total income under section 115JC Rs.185
33.4 Applicability:- These amendments take effect from 1st
April, 2015 and will,accordingly, apply in relation to the assessment year
2015-16 and subsequent assessment years.
34. Credit of Alternate Minimum Tax
34.1 The provisions of sub-section (1) of section 115JEE of
the Income-tax Act before amendment by the Act, provided that the provisions of
Chapter-XII BA shall be applicable to any person who has claimed a deduction under
part C of Chapter VI-A or claimed a deduction u/s 10AA. Further the provisions
of sub-section (2) of section 115JEE, before amendment by the Act, provided that
the Chapter shall not be applicable to an individual, HUF, association of persons
, a body of individuals
(whether incorporated or not) or an artificial juridical
person if the adjusted total income does not exceed twenty lakh rupees. This has created
difficulty in claim of credit of alternate minimum tax under section 115JD in an
assessment year where the income is not more than twenty lakh rupees or there is
no claim of any deduction under section 10AA or Chapter VI-A.
34.2 Sub-section (1) of section 115JEE has been amended to
provide that Chapter XII-BA shall also be applicable to a person who has claimed
any deduction under section 35AD of the Income-tax Act.
34.3 Further, with a view to enable an assessee to claim
credit of alternate minimum tax paid in any earlier previous year, section
115JEE has been amended to provide that the credit for tax paid under section 115JC
shall be allowed in accordance with the provisions of section 115JD,
notwithstanding the conditions mentioned in sub-section (1) or (2) of section 115JEE.
34.4 Applicability: - This amendment takes effect from 1st
April, 2015 and will accordingly, apply in relation to the assessment year
2015-16 and subsequent assessment years.
