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2023 (1) TMI 657 - AT - Income TaxMAT credit of Surcharge and Education Cess - Adjustment while giving the MAT credit of earlier years - Credit of surcharge and education cess in the income of the Assessee - HELD THAT - Commissioner not only considered the judgments referred but also perused the legal provisions of the relevant sections and the factual aspects of the case and then only decided the issue qua credit of surcharge and education cess in the income of the Assessee. Even otherwise, in the case of CIT vs. K. Srinivasan 1971 (11) TMI 2 - SUPREME COURT clearly held that income tax would include surcharge and additional surcharge. Even otherwise we do not find any reason and/or material to contradict the findings of the Commissioner and hence considering the spirit of the provisions of Act as applicable to the instant case, are inclined not to interfere in the impugned order. Appeal filed by the Revenue stands dismissed.
Issues:
1. Adjustment of MAT credit for Surcharge and Education Cess. Analysis: Issue 1: Adjustment of MAT credit for Surcharge and Education Cess The appeal was filed by the Revenue Department against the order of the Commissioner of Income-tax (Appeals) concerning the adjustment made by the Assessing Officer in the MAT credit of the Assessee for the assessment year 2016-17. The Assessee had declared an income of Rs. 89,98,21,770/-, and the issue arose when the credit of tax paid under section 115JD of the Act was reduced from Rs. 6,70,15,431/- to Rs. 5,80,92,435/- on the grounds that surcharge and education cess were not adjustable while giving the MAT credit of earlier years. The Assessee challenged this adjustment, and the Commissioner allowed the appeal by considering various judgments, including one from the Hon'ble ITAT Delhi in the case of Consolidated Securities Ltd. vs. ACIT. The Commissioner held that the MAT credit under section 115JAA with respect to Surcharge and Education Cess should be allowed, citing the decision of the Hon'ble Calcutta High Court in the case of M/s. Srei Infrastructure Finance Ltd. The Commissioner directed the Assessing Officer to allow the credit of Surcharge and Education Cess while computing the income under MAT provisions for the relevant year. The Revenue Department, in its appeal, argued that the judgments referred to were in the context of companies and not individual cases like the present one. However, the Tribunal emphasized that the spirit of the provisions should be considered over the specifics of the cases. The Tribunal noted that income tax includes surcharge and additional surcharge, as confirmed by the Hon'ble Apex Court in a previous case. Therefore, the Tribunal upheld the decision of the Commissioner, stating that there was no reason to interfere with the findings and dismissed the appeal filed by the Revenue Department. In conclusion, the Tribunal upheld the Commissioner's decision to allow the credit of Surcharge and Education Cess in the MAT provisions for the relevant year, emphasizing the importance of considering the spirit of the provisions and legal precedents in such matters.
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