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Income Tax Appellate Tribunal, MUMBAI BENCHES, ‘G’ MUMBAI
Before: Shri Joginder Singh, & Shri Manoj Kumar Aggarwal
आदेश / O R D E R
Per Joginder Singh(Judicial Member) The assessee is aggrieved by the impugned order dated 02/11/2015 of the Ld. First Appellate Authority, Mumbai.
2. During hearing of this appeal, the ld. counsel for the assessee, Shri Pankaj Toprani, did not press the original grounds of appeal
and pressed only the additional ground raised by the assessee dated 16/01/2017. The ld. DR, Miss. Anupama Singla, had no objection to the additional grounds raised by the assessee, therefore, the main grounds raised by the assessee are dismissed as not pressed. The question raised before us, whether the discretionary trust is chargeable at maximum marginal rate of tax or normal rate of tax. The ld. counsel invited our attention to section 164(1) of the Income Tax Act, 1961 (hereinafter the Act). Reliance was placed upon the decision in the case of assessee itself for Assessment Year 2013
14. (ITA No.5619/Mum/2015) order dated 09/03/2016, wherein, the appeal was allowed for statistical purposes. The ld. DR though defended the addition but had no objection if the same is allowed for statistical purposes.
2.1. We have considered the rival submissions and perused the material available on record. Before coming to any conclusion, we are reproducing hereunder the relevant
M/s Nanji Ganpat Chheda Discretionary Trust, portion from the aforesaid order of the Tribunal dated 09/03/2016 for ready reference and analysis:-
“The assessee is aggrieved by the impugned order dated 02/11/2015 of the Ld. First Appellate Authority, Mumbai. The assessee has also raised additional ground, alongwith other grounds, that the Ld. First Appellate Authority did not appreciate that the assessee Trust was declared by late Smt. Manibai Chheda by Will and it is a only trust, so declared by her, thus the provisions of clause (ii) of the first proviso to Sec. 164(1) is also applicable, therefore, the applicable rate of tax is that of AOP and not the maximum marginal rate of tax.
During hearing the ld. counsel for the assessee, Shri Pankaj R. Toprani advanced arguments which is identical to the ground raised. On the other hand, the ld. DR, Shri Vishwas Jadhav contended that this ground was not raised before the ld. Commissioner of Income Tax (Appeals), therefore, cannot be raised before this Tribunal.
I have considered the rival submissions and perused the material available on record. So far as the legal ground, raised for the first time before this Tribunal is concerned, I am of the view that in view of the decision from Hon’ble Apex Court in NTPC Limited v. CIT [1998] 229 ITR 383 (SC), a legal ground can be raised before this Tribunal. It is also noted that the ld. Commissioner of Income Tax (Appeals) has recorded a finding that the trust was created by a Will, therefore, there is a merit in the submissions of the assessee. The ld. counsel for the assessee, during hearing also pleaded that if there is an ambiguity, then, in view of the decision from Hon’ble Apex Court in Vegetable Products (89 ITR 236) it has to be decided in favour of the assessee. Without commenting further, I admit the legal ground and send the same to the file of the ld. Commissioner of Income Tax (Appeals) to examine the claim of the assessee and after considering the facts,
M/s Nanji Ganpat Chheda Discretionary Trust, decide in accordance with law. Thus, the appeal of the assessee is allowed for statistical purpose only.
Finally, the appeal of the assessee is allowed for statistical purpose.” Considering the totality of facts, in view of the decision from Hon'ble Apex Court in the case of NTPC Ltd. vs CIT (1998) 229 ITR 383 (SC), the additional ground raised by the assessee is admitted and sent to the file of the Ld. Commissioner of Income Tax (Appeal) for fresh adjudication in accordance with law. The Ld. Commissioner of Income Tax (Appeal) is directed to examine the factual matrix, also considering the provision to clause (ii) of the first proviso to section 164(1) of the Act. The assessee be given opportunity of being heard. Thus, the appeal of the assessee is partly allowed for statistical purposes only.
Finally, the appeal of the assessee is partly allowed for statistical purposes only.