2018 (12) TMI 1254 - AT - Income Tax

Tribunal Upholds MAT Credit Inclusion of Surcharge & Cess for 2011-12

The Tribunal upheld the Commissioner of Income Tax (Appeals)'s decision to include surcharge and education cess in Minimum Alternate Tax (MAT) credit ... MAT credit - surcharge and education cess - computation of credit under section 115JAA in the year of payment under section 115JB - set-off against tax liabilityMAT credit - surcharge and education cess - computation of credit under section 115JAA in the year of payment under section 115JB - Whether payment of surcharge and education cess must be included for the purpose of computing MAT credit under section 115JAA for the assessment year 2011-12. - HELD THAT: - The Assessing Officer computed MAT credit by excluding surcharge and education cess. The ld. CIT(A) directed that surcharge and cess be considered in computing MAT credit, following the Tribunal's earlier reasoning in the assessee's own case for AY 2012-13 and the coordinated decisions of Tribunal Benches which, applying the principle that tax components under the MAT provisions include surcharge and education cess, held that MAT credit must be allowed on parity either by excluding surcharge and cess from both sides or by including them within the MAT credit amount so that credit can be set off against the tax liability inclusive of surcharge and cess. The Departmental Representative did not demonstrate that those Tribunal decisions had been modified or reversed by a higher authority. In the present appeal the Tribunal found that the CIT(A) rightly followed the cited precedents and there was no reason to interfere with the direction to the Assessing Officer to revise MAT credit by including payment of surcharge and cess. [Paras 6, 7]The direction of the ld. CIT(A) to include surcharge and education cess in the computation of MAT credit is upheld and the Revenue's ground is dismissed.Final Conclusion: Revenue's appeal is dismissed; Assessing Officer to revise the MAT credit computation for AY 2011-12 to include surcharge and education cess as directed by the CIT(A). Issues:- Whether the Assessing Officer correctly granted MAT credit in the assessment year 2011-12.- Whether the payment of surcharge and education cess should be considered for the purpose of MAT credit.- Whether the decision of the Tribunal in a previous case for the assessment year 2012-13 should be followed.Analysis:1. The appeal by the Revenue challenged the order of the Commissioner of Income Tax (Appeals) regarding the MAT credit for the assessment year 2011-12. The main contention was the non-inclusion of payment of surcharge and education cess in the MAT credit calculation.2. The Assessing Officer granted MAT credit of &8377;1,30,06,509/- instead of the claimed &8377;1,86,40,748/- by the assessee, citing the exclusion of surcharge and cess. The ld. CIT(A) directed the Assessing Officer to consider these payments for MAT credit based on the assessee's submissions.3. The Tribunal referred to a previous case for the assessment year 2012-13 where a similar issue was addressed. The Tribunal observed that the MAT credit should include surcharge and cess, as per the decisions of the Coordinate Benches and the Hon'ble Supreme Court, emphasizing the need for parity in tax calculations.4. The Revenue contended that the Tribunal's decision in the previous case was under appeal at the High Court, but the Tribunal upheld the ld. CIT(A)'s order, following the precedent set by previous judgments. The Tribunal dismissed the Revenue's appeal, stating that the MAT credit should be revised to include surcharge and cess as directed by the ld. CIT(A).5. The Tribunal found no reason to interfere with the ld. CIT(A)'s decision, as it was consistent with legal precedents and the principles of tax liability calculation. The appeal filed by the Revenue was ultimately dismissed, upholding the inclusion of surcharge and education cess in the MAT credit computation.6. The Tribunal's decision was based on established legal principles and previous judgments, ensuring consistency in tax calculations and upholding the assessee's right to claim MAT credit inclusive of surcharge and education cess. The appeal outcome favored the assessee, affirming the importance of following legal precedents in tax matters.