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TMI Blog2024 (11) TMI 1247X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT, CPC, Bengaluru (in short "The AO, CPC") in respect of Assessment Year: 2018-19. 2. The assessee has raised the following grounds of appeal: "1.1. The impugned assessment order u/s 143(1) dt. 16.12.2019 is, are bad in law, illegal, invalid, void ab-initio on facts of the case, for want of jurisdiction, and also barred by limitation and various other reasons and hence the same may kindly be quashed. 1.2 The Id. AO has grossly erred in law as well as on the facts of the case in passing the ex-parte order without providing adequate and reasonable opportunity of being heard and in gross breach of law. Hence the additions so made by the id. AO may kindly be quashed and delete. 2. The Id. CIT(A) has grossly erred in law as well as on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... based on Maximum Marginal Rate and consequently, levied interest U/s 234 A, B, and C of the Act. 5. Aggrieved by the said order, the appellant has filed appeal u/s 246 of the Act before the Ld. CIT(A) who has rejected the appeal by observing as under: "6.1. It is seen from the grounds of appeal filed by the appellant that the sole ground for dispute is regarding taxing under "Maximum Marginal Rate" in place of normal rate as well as levy of interest U/s 234 A, B, C & D of the Act. 6.2. It is seen the case of the appellant that it is claiming the status of trust by virtue of its registration under Rajasthan Public Trust Act, 1959. However, no details are provided whether the appellant is granted registration U/s 12 AA of the Income Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... However, no details were provided either with the Return of Income before AO/CPC or in appellate proceedings before the Ld. JCIT(A), whether the appellant was granted registration U/s 12 AA of the Income Tax act, 1961. 7. The Ld. AR submitted that the impugned order u/s 143(1) dated 16.12. 2019 as well as the decision taken by the Id. CIT(A) is bad in law, invalid, illegal. The AR explained that the ld. AO and ld. CIT(A) has erred in applying Maximum Marginal Rate (MMR), by ignoring the proviso to section 164(2). The Ld. AR has pleaded that tax rates would be applicable at normal rate on the line of AOP as per provisions of section 164(2) of the Act when a trust has not been registered u/s 12AA of the Act. The Ld. DR for the department re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns contained in clause (b) of sub-section (1) of section 13, its income cannot be charged at the maximum marginal rate but its income has to be taxed at rates specified for an AOP as provided under section 164(2)." 9. The provision of Section 164(2) lays down that where relevant income or part of the income is not exempt u/s 11 due to violation of Section 13(1)(c ) or 13(1)(d) of the Act, then in that eventuality tax shall be charged on the relevant income or part of the relevant income at MMR and not that entire income of the trust would be charged to tax at MMR. In the present case, the entire income declared in the Income Tax return by the appellant Trust is not exempted in absence of registration u/s 12AA of the Act. Meaning thereby t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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