INCOME TAX OFFICER, KAUTILYA BHAWAN vs. PETROLEUM TRUST, MUMBAI

Facts

The assessee, a discretionary trust with RIIHL as its sole beneficiary, filed its return declaring a significant income. RIIHL opted for a new tax regime under Section 115BAA. The assessee, claiming to be a representative assessee, sought to be taxed at the same rate as RIIHL, which was dismissed by the lower authorities.

Held

The tribunal held that the trustee is a representative assessee under Section 160 and liable to the same duties, responsibilities, and liabilities as if the income were received beneficially. The tax can be levied upon and recovered from the trustee in the same manner and to the same extent as from the person represented. The decision of the Hon'ble Jurisdictional High Court in Mrs. Amy F. Cama vs. CIT was relied upon.

Key Issues

Whether the assessee, a trust, is eligible for taxation under Section 115BAA and whether it qualifies as a "Representative Assessee" under Section 160 and 161 of the Income Tax Act.