TaxTMI 
TaxTMI 
TaxTMI 
2016 (5) TMI 1480
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.... 3. The Learned AO failed to appreciate that having not denied the Carry-forward of tax to the extent of surcharge, education cess and secondary and higher education cess while completing the assessments for the AY 2008-09, AY 2009-10 and AY 2010- 11, he cannot deny the set-off in AY 2011-12. The Learned CIT(A) has erred in confirming the denial of set-off to the extent of surcharge, education cess and secondary and higher education cess. 3. The learned AO and CIT(A) have failed to appreciate that tax for the purpose of section 115JAA of the Act includes surcharge, education cess and secondary and higher education cess. Ground No.2 - Deduction for Gratuity paid to employees under section 40A(7) of the Act 5. The Appellant humbly seeks directions to be issued to the Learned AO by this Hon'ble Tribunal grant deduction towards gratuity paid to the employees which it is eligible for, though not claimed before the lower authorities''. 3. The Brief facts of the case that the assessee company is in software development services and filed return of income on 29.11.2011 admitting total income of ;17,05,70,172/- and the return of income was processed u/s.143(1) of the Act. The cas....
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....and ld. Commissioner of Income Tax (Appeals) directed Assessing Officer to verify and allow the claim based on the alternative ground raised by the assessee that if the MAT credit is not considered to include surcharge and cess alternatively tax liability for the current assessment year shall be calculated excluding surcharge and cess and allow MAT credit and levy surcharge and cess. Aggrieved by the order of Commissioner of Income Tax (Appeals), the assessee has assailed an appeal before Tribunal. 5. Before us, the ld. Authorised Representative reiterated the submissions made in the assessment and appellate proceedings and substantiated his arguments, supporting the provisions of law and alleging the action of the Assessing Officer as bad in not granting MAT credit u/sec. 115JAA of the Act including surcharge, education cess and secondary and higher education cess in determining tax liability. Prime facie the ld. Assessing Officer has denied carried forward of surcharge, education cess, and secondary and higher education cess while completing the assessment and argued that tax also includes surcharge and cess and prayed for allowing the appeal. 6. Contra, ld. Departmental Repres....
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....er the MAT credit tax liability, the surcharge and cess has to be calculated for the purpose of working out the grand tax liability. We also find merit and substance in the alternative contention of the assessee that if the MAT credit is taken into account without including the surcharge and education cess then the surcharge and education cess on the tax liability has to be calculated only after allowing the MAT credit. Alternatively, the amount of MAT credit should also include surcharge and education cess for the purpose of allowing the credit against the tax liability inclusive of surcharge and education cess. Therefore, the MAT as well as normal tax before allowing the MAT credit has to be taken on parity either exclusion of surcharge and education cess or inclusive of surcharge and education cess or inclusive of surcharge and education cess. Accordingly we set aside the orders of authorities below and direct the Assessing Officer to allow the MAT credit against the tax liability payable before surcharge and education cess or alternatively the amount of MAT credit should also be inclusive of surcharge and education cess and then allow the credit against the tax payable inclusiv....
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..... We heard rival submissions, perused the material on record and judicial decisions and the additional evidence filed for admitting additional ground. The ld. Authorised Representative for the first time has raised claim before Tribunal and filed a petition and was strongly opposed by the Department. Considering the supporting evidence and claim, being legal issue, we admit and adjudicate the additional ground. The ld. Authorised Representative has argued and filed paper book including ledger copy of bank account, salary payable account and computation of income and financial statements. The ld. Authorised Representative drew our attention to page no.44 of paper book were provision of gratuity was disallowed and referred to ledger copy of gratuity at page no.7 of paper book were statement of employees who left the services and gratuity was paid ;2,94,719/-. The ld. Authorised Representative to substantiate the genuiness of payment supported the grounds with copies of form no.16 issued by the assessee company as employer to employees and the breakup was reflected in the profit and loss account for the year ending 31.03.2011 under the schedules of personal expenses at page No.52 of p....