ANSHUL JAGRUCHI TRUST,LAXMAN SINGH BLOCK, NEAR TRITON MALL vs. INCOME TAX OFFICER WARD 6(2), C.R. BUILDING,JAIPUR

ITA 1513/JPR/2026Status: HeardITAT Jaipur15 October 2026AY 2025-264 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the issue was covered by the Special Bench decision in Araadhya Jain Trust Vs. ITO. The Special Bench had categorically held that for private discretionary trusts whose income is chargeable to tax at MMR, the surcharge is to be levied as per the slab rates prescribed in the Finance Act under the heading 'surcharge on income tax'. The Tribunal directed the CPC/AO to levy the surcharge as per the prescribed slab rates in the Finance Act. Consequently, the appeal of the assessee was allowed in terms of this direction. No issue was expressly left undecided.

What were the facts?

The assessee, Anshul Jagruchi Trust, a private family trust, filed its return of income for the assessment year 2026-27, opting for the new tax regime under Section 115BAC. The trust's income, derived from capital gains, interest, and dividends, was liable to tax at the Maximum Marginal Rate (MMR) as per Section 164. The assessee paid tax and a surcharge at 25%. However, the Centralized Processing Center (CPC) processed the return and applied a surcharge of 37% on the normal income and 15% on dividend income. The assessee challenged this levy of 37% surcharge on normal income before the Commissioner of Income Tax (Appeals) [CIT(A)], who dismissed the appeal. The assessee then filed an appeal before the Income Tax Appellate Tribunal (ITAT).

What were the issues?

1. Whether, in the case of a private discretionary trust whose income is chargeable to tax at the Maximum Marginal Rate (MMR), the surcharge is to be levied at the highest applicable rate or at slab rates, as per Section 164 and the Finance Act. Assessee's contentions: The assessee argued that the surcharge should be levied as per the slab rates prescribed in the Finance Act, not at a flat highest rate. They relied on the decision of the Special Bench of the ITAT in the case of Araadhya Jain Trust Vs. ITO (ITA No.4272/Mum/2024, dated 09.04.2025). Revenue's contentions: The Revenue did not present any specific arguments or point out distinguishing facts from the case relied upon by the assessee.

Which sections of the Income-tax Act were involved?

Section 164,Section 115BAC,Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES, “A” BENCH, JAIPUR

Hearing: 14.10.2026Pronounced: 15.10.2026

Per Annapurna Gupta, AM:- The present appeal has been filed by the assessee against the order passed by the Office of the Commissioner of Income Tax, Appeal Addl./JCIT(A) 09, Mumbai (hereinafter referred to as “Ld. CIT(A)”), dated 18.03.2026 under Section 250 of the Income Tax Act, 1961 (hereinafter referred to as “the Act”).

P a g e | 2 Anshul Jagruchi Trust

2.

The grounds raised by the assessee read as under:-

1.

That under the facts and in the circumstances of the case the ADDL./JCIT Appeal 9 has erred in holding that provisions of section 164 are applicable. Consequently, income is liable to be taxed at Maximum Marginal Rate. Accordingly, the action of CPC in applying Maximum Marginal

The order continues below.

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