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TMI Blog2025 (5) TMI 1583X X X X Extracts X X X X X X X X Extracts X X X X ..... mpugned orders emanated from the orders of the CPC, Bengaluru (in short "CPC"), passed under section 143(1), date of orders27/05/2024 for A.Y. 2023-24 and order passed under section 154, date of order 03/01/2023 for A.Y 2021-22. 2. Both the appeals have common facts and issue, therefore, both the appeals were heard together and are disposed of by this common order. ITA No.6426/Mum/2024 for A.Y. 2023-24 is taken as the lead case. The grounds raised for this year are as under:- "GROUNDS OF APPEAL NO. 1 On facts and in law, the Learned Addl/CIT (A)-2, Gurugram had erred in not directing the Learned Assessing Officer to levy surcharge on total liability based on the total income of the appellant in appellant's case should be restricted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dividend income of Rs. 5,66,680/- and interest and other incomes of Rs. 72,14,767/-. The surcharge on tax liability of normal income (excluding dividend income) was computed @15% as per Finance Act, 2023. However, the CPC had not considered the applicability of surcharge levied on the total income of the assessee, but charged the surcharge @37%. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld.CIT(A) upheld the view taken by the Ld.AO. Being aggrieved, assessee filed an appeal before us. 4. The core issue raised before the Bench pertains to whether the maximum marginal rate (MMR) is to be applied at the highest rate of 37%, or at the slab rate applicable to the assessee, i.e., 15%. The Hon'ble Special Bench of the ITAT, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act, would mean the surcharge as provided in the computation mechanism under the heading 'surcharge on income tax' finding place in Paragraph A, Part (I) of First Schedule to the Finance Act-2023. 30. The Revenue has taken a line of argument that the words 'if any' succeeding the words 'including surcharge on income tax' appearing in the definition of maximum marginal rate u/s. 2(29C) of the Act are only for the purpose that when levy of surcharge is specifically provided under the Finance Act of the relevant year, it would be included in income-tax computed at the highest rate, otherwise, not. Though, at first blush this argument of the department sounds attractive, however, on deeper analysis it is found to be superfluous, for the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng. 31. As we find, the Revenue has placed strong reliance upon the decision of the coordinate bench in case of Araadhya Jain Trust (supra) and couple of other decisions, which are on similar line. Pertinently, the decision rendered in case of Anant Bajaj Trust vs. DDIT (in ITA No. 199/Mum/2024 vide order dated 26.08.2024) was subsequently recalled. Whereas, the bench has followed the decision of Anant Bajaj Trust (supra) while deciding the appeal of Kapur Family Trust vs. ITO (in ITA Nos. 3834 & 3835/Mum/2024 vide order dated 30.10.2024). Therefore, the decision rendered in case of Kapur Family Trust (supra) has lost its relevance. Insofar as the decision of the co-ordinate bench in the case of Araadhya Jain Trust (supra) is concerned, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the findings and observations of the Hon'ble Special Bench of the Tribunal. 6. We have heard the rival submissions and perused the material available on record. The assessee is a "Private Discretionary Trust," whose income is ordinarily chargeable to tax at the maximum marginal rate. However, the computation of surcharge on the income-tax must be determined with reference to the applicable slab rates as prescribed in the Finance Act under the heading "Surcharge on Income" appearing in Paragraph 11, Part I of the First Schedule, relevant to the concerned assessment year. The view taken aligns with the decision of the Hon'ble Special Bench in Aradhya Jain Trust (supra). The facts of the present case are materially similar to those consid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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