2024 (7) TMI 1658 - AT - Income Tax

Levy of surcharge - Scope of first schedule of the Finance Act 2020 which provides that the amount of income tax shall be increased by surcharge at rates specified therein when the total income exceeds the threshold limits i.e. Rs. 50 Lakhs/ Rs. 1 Crore/Rs. 2 Crores/Rs. 5 Crores - HELD THAT - Surcharge has to be levied only when the income exceeds Rs. 50 Lakhs. As mentioned elsewhere the returned income of the assessee is Rs. 43, 51, 640/- and the same has been accepted as such and being less than Rs. 50 Lakhs would not attract surcharge. Therefore the AO is directed to delete the surcharge so levied. Appeal of the assessee is allowed.

Summary

The Appellate Tribunal (ITAT Mumbai) allowed the assessee's appeal against the levy of surcharge of Rs. 4,83,032/- for Assessment Year 2022-23. The key issue was the applicability of surcharge under the first schedule of the Finance Act, 2020, which imposes surcharge only when total income exceeds specified thresholds, starting at Rs. 50 Lakhs. The assessee's total income was Rs. 43,51,640/-, accepted as such under section 143(1) of the Income-tax Act. The Tribunal held that since the income did not exceed Rs. 50 Lakhs, "the surcharge has to be levied only when the income exceeds Rs. 50 Lakhs," and thus surcharge was not applicable. Consequently, the Assessing Officer was directed to delete the surcharge. The appeal was allowed.