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Income Tax Appellate Tribunal, ‘C’ BENCH : CHENNAI
Before: SHRI ABRAHAM P. GEORGE & SHRI DUVVURU RL REDDY]
आदेश / O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER:- In this appeal filed by the Revenue, which is directed against an order dated 31.10.2017 of ld. Commissioner of Income Tax (Appeals)-5, Chennai, it is aggrieved that ld. Commissioner of Income Tax (Appeals) allowed MAT credit u/s.115JAA of the Income Tax Act,
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1961 (in short ‘’the Act’’), as adjustment from the tax on total income before applying surcharge and educational cess.
On a query from the Bench, it was admitted by the ld. 2.
Departmental Representative that the difference on account of educational cess in the MAT credit was �1,04,72,415/- only. Tax applicable for assessment year 2010-2011 under MAT provision is 15% and this would be less than �20,00,000/-. Accordingly by virtue of CBDT Circular No.03/2018, dated 11.07.2018, appeal of the Revenue may not survive.
Even otherwise the question raised by the Revenue does not merit acceptance. This is due to the fact that tax credit to be allowed u/s.115JAA of the Act by virtue of Sub Section (1) thereof is difference between tax paid for any assessment year u/s.115JA(1) of the Act, and the amount of tax payable by the assessee in accordance with other provisions of the Act. The important word used is tax paid. As per the judgment of Hon’ble Apex Court in the case of CIT vs. K. Srinivasan, (1972) 83 ITR 346, the term tax includes surcharge. Under Sub Section (5) of Section 115JAA, setoff in respect of brought forward tax credit is allowed for any assessment year, to the extent of the difference between tax on the total income and the tax which would have been payable under Section 115JA or 115JB as the case may be.
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The term used is tax and not income tax. Considering the judgment of Hon’ble Apex Court mentioned supra, in our opinion, the decisions relied on by the Revenue would not further its case.
In the result, the appeal of the Revenue stands dismissed.
Order pronounced on Wednesday, the 5th day of September, 2018, at Chennai.