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CBDT relaxes norms for MAT on firms facing insolvency

This has been done to minimise the genuine hardships faced by such companies, said the Central Board of Direct Taxes (CBDT)

Press Trust of India  |  New Delhi 

Insolvency ordinance: SME promoters may get leeway

The Department today relaxed norms for levy of (MAT) on companies facing corporate proceedings.

As per Section 115JB of the Act, MAT is levied on book profit after deducting the amount of loss brought forward or unabsorbed depreciation, whichever is less.

"With effect from assessment year 2018-19 (FY2017-18), in case of a company, against whom an application for corporate resolution process has been admitted by the adjudicating authority under...the IBC, the amount of total loss brought forward (including unabsorbed depreciation) shall be allowed to be reduced from the book profit for the purposes of levy of MAT under section 115JB of the Act," it said.

This has been done to minimise the genuine hardships faced by such companies, said the Central Board of Direct Taxes (CBDT).

Lenders of those companies, which have defaulted on loans, have been approaching the National Company Law Tribunal (NCLT) under the and Bankruptcy Code.

First Published: Sat, January 06 2018. 18:17 IST
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