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TMI Blog2016 (8) TMI 967X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount of tax already paid in advance or credit which is statutorily available to the assessee. Only thereafter the question of any addition on account of interest might arise. This was explained by Their Lordships. It is not correct to say that the judgement in the case Tulsyan Nec Ltd. [2010 (12) TMI 23 - Supreme Court of India] has no application to the facts and circumstances of this case. Our attention was not drawn nor was it contended that the corrected form is contrary to law. Both the forms, viz. the one which was prevalent at the relevant period of time and which was corrected for the assessment year 2012-13, could not be the correct forms. If the form of 2012-13 was correct, then the form of 2008-09 was wrong, and naturally contrary to law. Decided against the assessee. - GA NO.1555 OF 2016, ITAT NO.245 OF 2016 - - - Dated:- 12-8-2016 - GIRISH CHANDRA GUPTA AND ARINDAM SINHA, JJ. FOR THE APPELLANT : MR. J.P.KHAITAN, SR. ADVOCATE, MR. SOMAK BASU, ADVOCATE FOR THE RESPONDENT : MRS. SMITA DAS DE, ADVOCATE The Court : The subject matter of challenge is a judgment and order dated 4th January, 2016 passed by the learned Income Tax Appellate Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 Rebate under section 88E (4 of Schedule-STTR) 6 7 Balance Tax Payable (5-6) 7 8 Surcharge on 7 8 9 Education cess, including secondary and higher education cess on (7+8) 9 10 Gross tax liability (7+8+9) 1 0 Portion of the form set out herein above suggest that the credit under section 115JAA has to be allowed before addition is made on account of surcharge and cess. The assessee wants that it should be allowed to do so. The learned Tribunal, however, has held that:- we find no merit in the contention of the assessee that MAT credit should first be reduced from the tax payable and thereafter on the residual amount the surcharge and educational cess be levied. Mr. Khaitan, learned senior advocate submitted that the form of Income Tax Return prescribed for the year 2008-09, quoted above, continued to hold the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entry 3 requires computation of the gross tax payable. Under entry 4, credit is required to be given under section 115JAA of the Act of the tax paid in earlier years. Entry 5 requires a computation of the tax payable after credit under section 115JAA of the Act. The matter is placed beyond doubt by the parenthesis, which indicates that tax payable under entry 5 is to be arrived at by deducting the credit under section 115JAA of the Act (under entry 3) from the gross tax payable (under entry 4). The surcharge is computed on the amount reflected in entry 5. Mr. Khaitan drew our attention to Sub-section 1 of Section 4 of the Income Tax Act as it was at the relevant period of time which reads as follows:- Where any Central Act enacts that income-tax shall be charged for any assessment year at any rate or rates, income-tax at that rate or those rates shall be charged for that year in accordance with, and [subject to the provisions (including provisions for the levy of additional income-tax) of, this Act] in respect of the total income of the previous year [***] of every person: Provided that where by virtue of any provision of this Act income-tax is to be charged in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich is as follows:- Notwithstanding anything contained in any other provision of this Act, where in the case of an assessee, being a company, the income-tax, payable on the total income as computed under this Act in respect of any previous year relevant to the assessment year commencing on or after the 1st day of April, [2007], is less than [ten per cent] of its book profit, [such book profit shall be deemed to be the total income of the assessee and the tax payable by the assessee on such total income shall be the amount of income-tax at the rate of [ten per cent]] He submitted that section 115JB provides for payment of income tax at the rate of 10%. The sub-section 1 does not provide for any payment on account of surcharge or cess. Similarly, section 115JAA, in particular, the sub-sections quoted above provide for tax credit to be allowed to the extent of the difference of the tax paid for any assessment year under section 115JB and the amount of tax payable by the assessee on his total income computed in accordance with the other provisions of the Act. By the expression computed in accordance with the other provisions of the Act what is meant is the normal comput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r purposes of the Union calculated in each case in the manner provided therein. Second proviso to Sub-section (3):- Provided further that in respect of any income chargeable to tax under sections 115A, 115AB, 115AC, 115ACA, 115AD, 115B, 115BB, 115BBA, 115BBC, 115E and 115JB or fringe benefits chargeable to tax under section 115WA of the Income-tax Act, the amount of income-tax computed under this sub-section shall be increased by a surcharge, for purposes of the Union, calculated. Sub-section (11). The amount of income-tax as specified in subsections( 1) to (10) and as increased by a surcharge, for purposes of the Union, calculated in the manner provided therein, shall be further increased by an additional surcharge, for purposes of the Union, to be called the Education Cess on income-tax , calculated at the rate of two per cent of such income-tax and surcharge so as to fulfil the commitment of the Government to provide and finance universalised quality basic education. Sub-section (12). The amount of income-tax as specified in subsections (1) to (10) and as increased by a surcharge, for purposes of the Union, calculated in the manne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax is what appears to have been provided without taking into account the surcharge and the cess? The answer we think again is an emphatic no . The reason behind increase of income tax by the amount of surcharge and cess has been spelt out on the basis whereof it can be said that the intention is that part of the amount realized by way of income tax is earmarked for being spent in education and higher education. We are, as such, of the opinion that the view taken by the learned Tribunal is a correct view. The learned Tribunal has relied on the judgement of the Apex Court in the case of CIT vs. Tulsyan Nec Ltd . , reported in [2011] 330 ITR 226 [SC]. Mr. Khaitan may be right in contending that the point raised in this appeal did not fall for consideration by Their Lordships in that judgement. The question which Their Lordships were considering was whether interest under Section 234A, 234B and 234C has to be added to the amount of tax before granting credit under Sections 115JA and 115JAA? Their Lordships answered that question in the negative. The reason is very obvious. In determining the liability of the assessee the first step has to be determination of tax payable. The I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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