Form 29B: Report of CA on Computing Book Profits of Company under Section 115JB

What is Section 115JB?

Section 115JB of the Income Tax Act was introduced to ensure that companies with large book profits but negligible or zero taxable income still pay a minimum amount of tax to the government. This is known as the Minimum Alternate Tax (MAT). Even if a company is eligible for exemptions or deductions, it must pay MAT if its normal tax liability is less than 15% of its book profits.

Purpose of Form 29B

• Certifies the correct computation of book profits under Section 115JB.
• Ensures the company complies with MAT provisions.
• Is mandatory for companies whose tax payable is less than MAT liability.
• Helps in claiming MAT credit in subsequent years.

Who Must File Form 29B?

All companies (private, public, or foreign) whose income is chargeable under the MAT regime and where the tax computed under normal provisions is less than 15% of book profits must file Form 29B. It is a mandatory annexure for ITR submission in such cases.

Due Date for Filing Form 29B

Form 29B must be furnished on or before the due date for filing the income tax return under Section 139(1). Typically, this is:

• October 31 of the assessment year for companies requiring audit.
• November 30 for companies required to furnish a transfer pricing report under Section 92E.

Pre-Requisites for Filing Form 29B

• Both taxpayer and CA must be registered on the Income Tax e-Filing portal.
• Valid and active PAN of both the taxpayer and the CA.
• Updated profile details and valid digital signature (if applicable).

Structure of Form 29B

Form 29B consists of the following parts:

• Part A: General information and basic details (mandatory for all).
• Part B: Computation of book profit under Section 115JB.
• Part C: Certificate by the Chartered Accountant confirming compliance with the MAT provisions.

Step-by-Step Process for Online Filing

1. Login to the Income Tax e-Filing portal.
2. Go to ‘e-File’ > ‘Income Tax Forms’ > ‘File Income Tax Forms’.
3. Search for Form 29B and select the applicable assessment year.
4. Assign the form to a registered Chartered Accountant by entering their Membership Number.
5. The CA receives a notification and logs into their portal to access and complete Form 29B.
6. The CA fills in all relevant details and uploads the completed report.
7. The taxpayer then reviews the form and accepts it using OTP/e-Verification/Digital Signature.
8. Once verified, the form is successfully submitted. Both parties receive confirmation messages.

Offline Filing (in exceptional cases)

Although online filing is preferred, under certain conditions (like technical issues or notification-based permission), Form 29B may be submitted in physical form at the Income Tax Department office with a signed verification from the CA and taxpayer.

Common Errors to Avoid

• Not using the updated utility version from the IT portal.
• Mismatched PAN or CA membership details.
• Failure to complete e-Verification by the taxpayer after CA submission.
• Incorrect computation or missing adjustments in book profits.

MAT Credit and Form 29B

The MAT paid under Section 115JB can be carried forward and set off in future years when normal tax liability exceeds MAT. Filing Form 29B accurately ensures proper credit tracking and utilisation.

Legal & Compliance Aspects

Non-filing or incorrect filing of Form 29B may lead to penalties and disallowance of MAT credit. Since it is a statutory audit certification, the role of a CA becomes critical, and due diligence is a must.

FAQs on Form 29B

Q1. Is Form 29B mandatory for all companies?

No, only those companies liable under MAT where tax under normal provisions is less than 15% of book profits.

Q2. Can ITR be filed without Form 29B?

No, if MAT is applicable, Form 29B must be submitted before or along with the ITR.

Q3. Who can certify Form 29B?

Only a Chartered Accountant with an active registration on the e-filing portal.

Q4. Can I file Form 29B after the due date?

Late filing may lead to penalties and loss of MAT credit benefits.

Conclusion

Form 29B plays a pivotal role in ensuring the correct application of MAT provisions under Section 115JB. It safeguards the government’s tax base while allowing companies to claim MAT credit in future years. Proper coordination between the taxpayer and the CA, timely submission, and accurate computation are essential to avoid compliance risks and future disputes.