2020 (8) TMI 9 - ITAT DELHI - Income Tax

Head Note / Extract:
Applicability of section 167B - taxing at maximum marginal rate - assessee in the status of AOP - HELD THAT:- Section 167B(2) prescribe that in case of any Association of Person (not being a case falling under sub-section 1 of 167B) if total income of the any member of the Association of Person (excluding the share from such Association) exceeds the maximum amount, which is not chargeable to tax under the Finance Act of the relevant year, the tax shall be charged on the total income of the Association at maximum marginal rate. CIT(A) held that income of the members being in the slab of maximum rate of tax, the society is not entitled to the benefit of exemption from the minimum amount and liable to the incidence of maximum marginal rate income of section 167B(ii) of the Act. CIT(A) on the issue in dispute is well reasoned. A society registered under the Societies Registration Act, 1860, has been excluded from the provision of section 167B9(1). Thus, in case of any society, which though has been held as Association of Person and income of such Association is indeterminate; such society will be excluded from invoking of maximum marginal rate. But, the provision of section 167B(2) are applicable in case of Association of persons not being a case falling under sub-section 1. Unambiguous provisions of 167B(2), if income of any member (other than the share of such Association) is higher than the basic exemption limit of the relevant year, the income of the Association is chargeable at the maximum marginal rate. Assessee has not disputed the finding of the CIT(A) that income of its member during the year under consideration exceeds the basic exemption limit. - Decided against assessee.