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2022 (4) TMI 838 - AT - Income TaxValidity of Reassessment proceedings - Status of a private discretionary trust - AOP OR Individual - AO levied FBT in respect of the fringe benefit provided by the assessee to its employees - HELD THAT:- CIT(A) has given a detail findings for each of the grounds of appeal raised by the assessee. The Ld. CIT(A) relied on the decision of Rajesh Jhaveri Stock Broker Pvt. Ltd.[2007 (5) TMI 197 - SUPREME COURT] wherein it was held that process u/s 115WE(1) of the Act will not amount to application of mind and the consequent reopening u/s 115WG cannot be said to be change of opinion. The Ld. CIT(A) also justified the AO’s view that during earlier proceedings also the charging of FBT was raised by the erstwhile AO and was decided to consider this issue separately and the same was not concluded. Therefore, we are of the considered view that the justification of the Ld. CIT(A) in holding the re-assessment as valid is not disputed. Treating the assessee as AOP as against the status of a private discretionary trust as ‘individual’ CIT(A) has rightly decided the issue in the light of various judicial decisions. The Ld. CIT(A) has interpreted the meaning of AOP on a comparison with the Hon’ble Supreme Court decision in the case of CIT vs. Indira Balkrishna [1960 (4) TMI 7 - SUPREME COURT] with that of the subsequent amendment by explanation to section 2(31) wherein the AOP can be formed without the common objective of deriving income, profits or gains, thus concluding that private discretionary trust will come under the purview of AOP. In addition to this, the proviso to section 164(1) also states that under the circumstance provided therein, the income of the discretionary trust shall be assessed to tax as AOP. The Ld. CIT(A) has also rejected the submission of assessee that the departmental circular referring to the discretionary trust as ‘individual’ is also not very relevant in view of the explanation provided to section 2(31) of the Act and the said circular merely refers to the difficulty in accepting the return by existing e-filing software if the status of private discretionary trust is shown as ‘individual’ is also not disputed. AR has submitted a copy of the latest judgment of Madras High Court in CIT, Chennai vs. Shriram Ownership Trust, Chennai [2020 (12) TMI 736 - MADRAS HIGH COURT] where the facts of the case are not identical with the present appeal before us and the said decision does not hold good for this case. Apart from this, there is no other material on record to take any other view than that of Ld. CIT(A)’s findings. - Decided against assessee.
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