2019 (4) TMI 2014 - AT - Income Tax

Surcharge and Cess Included in MAT Credit Calculation

The Deputy Commissioner of Income Tax, Versus  M/s Scope International Pvt. Ltd., (Presently known Standard Charted Global Business Services Pvt. Ltd.),  Chennai

The Appellate Tribunal ITAT Chennai held that surcharge and education cess are part of income-tax for computing MAT credit under Section 115JAA of the ... MAT Credit - inclusion of surcharge and education cess while computing MAT credit under Section 115JAA - HELD THAT:- For assessment year 2009-10, an identical issue came before this Tribunal in the assessee's own case [2018 (11) TMI 1640 - ITAT CHENNAI] as placing reliance on the judgment of CIT v. K. Srinivasan [1971 (11) TMI 2 - SUPREME COURT] found that the surcharge and education cess are part of income-tax. This Tribunal has also found that the CIT(Appeals) has directed the Assessing Officer to verify the MAT credit. Since the CIT(Appeals) has no power to direct the Assessing Officer to verify the claim of the assessee, this Tribunal in exercise of its jurisdiction conferred under Section 254(1) of the Act, directed the Assessing Officer to verify the claim of the assessee and thereafter allow the claim with regard to MAT credit. In view of the order of this Tribunal for assessment year 2009-10, the Assessing Officer shall verify the claim of the assessee and thereafter allow the claim with regard to MAT credit as in the case of assessment year 2009-10. - Decided against revenue. Issues:Inclusion of surcharge and education cess while computing MAT credit under Section 115JAA of the Income-tax Act, 1961.The judgment by the Appellate Tribunal ITAT Chennai involved the consideration of the inclusion of surcharge and education cess while computing MAT credit under Section 115JAA of the Income-tax Act, 1961. The Tribunal heard arguments from both the Ld. Departmental Representative and the Ld. counsel for the assessee. It was noted that in a previous case for assessment year 2009-10, a similar issue had been brought before the Tribunal in the assessee's own case. The Tribunal, relying on the judgment of the Apex Court in CIT v. K. Srinivasan (1972) 83 ITR 346, determined that surcharge and education cess are part of income-tax. The Tribunal also observed that the CIT(Appeals) had directed the Assessing Officer to verify the MAT credit, which was beyond the CIT(Appeals)'s power. Therefore, the Tribunal, under its jurisdiction conferred by Section 254(1) of the Act, directed the Assessing Officer to verify the claim of the assessee and allow the claim with regard to MAT credit. The Tribunal instructed the Assessing Officer to follow the same procedure as in the case of assessment year 2009-10. Consequently, with this direction, the appeal of the Revenue was dismissed by the Tribunal. The order was pronounced in court on 1st April 2019 at Chennai.---