GUJARAT STATE PETRONET LIMITED,GANDHINAGAR vs. DCIT, GANDHINAGAR CIRCLE, GANDHINAGAR, GANDHINAGAR

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ITA 991/AHD/2025Status: DisposedITAT Ahmedabad29 July 2025AY 2012-13Bench: Shri Sanjay Garg (Judicial Member), Smt. Annapurna Gupta (Accountant Member)1 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the issue of whether MAT credit includes surcharge and education cess was debatable. Therefore, the AO was not justified in using Section 154 to reduce the credit which was allowed in the original assessment.

What were the facts?

The assessee's appeal was against the CIT(A)'s order upholding the AO's rectification order. The AO had reduced the MAT credit allowed to the assessee by invoking Section 154, excluding surcharge and education cess.

What were the issues?

Whether the AO was justified in rectifying the MAT credit under Section 154 when the issue was debatable and the credit was allowed in the original assessment.

Which sections of the Income-tax Act were involved?

Section 154,Section 115JAA,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD

Before: Shri Sanjay Garg & Smt. Annapurna Gupta

For Appellant: Shri S.N. Soparkar, Sr.Advocate
Hearing: 28/07/2025Pronounced: 29/07/2025

Gujarat State Petronet Ltd. The DCIT बनाम/ Wing “A” Plot No.E-18 Gandhinagar Circle v/s. GSPL Bhavan, Gandhinagar GIDC Electronics Estate Nr.K-7, Circle, Sector-26 Gandhinagar – 382 028 (Gujarat) "थायी लेखा सं./PAN: AABCG 1812 E (अपीलाथ)/ Appellant) (*+ यथ)/ Respondent) Assessee by : Shri S.N. Soparkar, Sr.Advocate Revenue by : Shri B.P. Srivastava, Sr.DR सुनवाई की तारीख/Date of Hearing : 28/07/2025 घोषणा की तारीख /Date of Pronouncement: 29/07/2025 आदेश/O R D E R Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 03/03/2025 for Assessment Year (AY) 2012-13. Gujarat State Petronet Ltd. vs. The DCIT Asst. Year : 2012-13

2.

Though the assessee has taken various grounds of appeal, however, the only ground pressed/argued by the Ld. Counsel for the appellant was as to whether the Ld.CIT(A) was justified in upholding the rectification order of the Assessing Officer (AO) passed u/s.154 of the Act, whereby, he has reduced the set off of MAT credit from Rs.33,21,42,214/- to Rs.30,86,81,262/- which was earlier allowed to the assessee in the scrutiny assessment order dated 31/03/2015 passed u/s.143(3) of the Act.

2.1. The Ld.AO observed that in view of the decision of the Hon’ble ITAT Delhi Bench of the Tribunal in the case of M/s.Richa Global Export Pvt.Ltd. vs. ACIT (CPC) (2012) in dated 31/08/20212, tax credit u/s.115JAA of the Act can be allowed only of income-tax and not of surcharge and education cess. He observed that since surcharge and education cess paid on tax were not included in the MAT credit, hence, the same was not allowable u/s.115JAA of the Act. He, invoking the provisions of section 154 of the Act, amended the order and excluded the claim of credit u/s.115JAA of the Act in respect of surcharge and education cess. The Ld.CIT(A) confirmed the aforesaid reduction of claim by way of rectification order u/s.154 of the Act by the AO.

3.

We have heard the rival contentions and gone through the record. The Ld.Counsel of the appellant has submitted that whether the credit of surcharge and education cess can be allowed u/s.154 of the Act was a debatable issue and that it was not a case of mistake apparent from record, therefore, the AO did not have any jurisdiction to reduce the claim of the assessee by invoking the provisions of section 154 of the Act, once the same was allowed in the scrutiny assessment proceedings carried out u/s.143(3) of Gujarat State Petronet Ltd. vs. The DCIT Asst. Year : 2012-13 the Act. The Ld.Counsel also placed reliance on various case-laws to submit that various Benches of the Tribunal have held that the MAT credit allowable to the assessee u/s.115JAA of the Act is inclusive of surcharge and education cess. The Ld.Counsel, in this respect, has relied on the decision of Co- ordinate Chandigarh Bench of the Tribunal in the case of M/s.Steel Strips Wheels Ltd. vs. DCIT (CPC), Bangalore in dated 18/03/2020 (incidentally, adjudicated by both of us) wherein, the Bench while further relying upon the another decision of the Chandigarh Bench of the Tribunal in the case of DCIT Ludhiana vs. M/s.Aarti Steels Ltd. in ITA No.1619/Chd/2017 vide order dated 11/10/2018 has held that the MAT credit allowable to the assessee is inclusive of surcharge and education cess. The Tribunal in the said case has also deliberated on the decision of the ITAT Delhi Bench in the case of ‘M/s.Richa Global Export Pvt.Ltd.’ (supra).

3.1. From the above, it is very much clear that the issue as to whether the MAT credit is inclusive of surcharge and education cess or it is simply restricted to income-tax only, is very much a debatable issue and there are various case-laws, wherein the issue has been decided in favour of assessee holding that the MAT credit u/s.115JAA of the Act is inclusive and surcharge and education cess. Under the circumstances, it was not a case of mistake apparent on record, rather it was a debatable issue and, therefore, the AO was not justified in reducing the MAT credit by invoking the provisions of section 154 of the Act. The action of the AO is beyond his jurisdiction as vested u/s.154 of the Act. Therefore, the impugned orders of the lower authorities are set aside by holding that the lower authorities were not justified in reducing the MAT credit allowed to the assessee u/s.143(3) of the Act by way of invoking the provisions of section 154 of the Act. The MAT credit allowed Gujarat State Petronet Ltd. vs. The DCIT Asst. Year : 2012-13 to the assessee in the original assessment order passed u/s.143(3) of the Act stands restored.

4.

In the result, appeal of the assessee stands allowed.

Order pronounced in the Open Court on 29/07/2025. ( Smt. Annapurna Gupta ) Judicial Member

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