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TMI Blog2017 (5) TMI 1722X X X X Extracts X X X X X X X X Extracts X X X X ..... ation 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. The Tribunal has noted that from the next assessment year, the assessment year 2012-13, the position was materially altered but, in the present case, since the dispute related to the assessment year 2011-12, the method of computation, as directed by the Commissioner (Appeals), was plainly in accordance with the methodology as provided in ITR-6. The Tribunal in confirming the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e heard both the parties and perused the material on record. The issue in dispute for assessment year 2011-12 came before Allahabad High Court in the case of CIT Vs. Vacment India reported in 369 ITR 304(Allahabad) wherein held that:- "5. The only question which is raised pertains to the computation of tax in accordance with the modalities which are prescribed in the relevant form, ITR-6. In so far as is material, the relevant entries in the form (Part B-TTI) are as follows : 3 Gross tax payable (enter higher of 2c and 1) 4 Credit under section 115JAA of tax paid in earlier years (if 2c is more than 1) (7 of Schedule MATC) 5 Tax payable after credit under section 115JAA [(3-4)] 6 Surcharge on 5 7 Education cess, including second ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al facts on the record. The provisions of section 115JB in brief are: every assessment year, two parallel computations are contemplated. One computation of total income in accordance with the normal provisions of the I.T. Act and another is the computation of book profit as stipulated u/s 115JB. If the income tax payable on the total income is less than 18.5% of the book profit computed u/s 115JB, then the book profit so computed shall be deemed to be the total income, then the book profit so computed shall be deemed to be the total income and the company shall pay tax @ 18.5% thereon. The amount so paid as the MAT shall be available to the credit of the company to be set off as contemplated u/s 115JAA within a period of 10 AYs. Surcharge a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act is more than tax payable under section 115JB and it shall be allowed to the extent of the following: Tax payable on total income under the normal provisions of the Act - tax payable under section 115JB = MAT credit to be allowed. 9.3 On careful reading, the sub-section 2A, the tax credit to be allowed shall be the difference of tax paid for any AY under sub-section (i) of 115JB and the amount of tax payable on his total income computed in accordance with the other provisions of this Act. The important word used is tax paid and as per the Hon'ble Apex Court decision in the case of K. Srinivasan (supra), the term 'tax' includes surcharge. 9.4 It is also important to evaluate sub-section (5) of section 115JAA. "Set off" in respect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est payable For default in furnishing the return (section For default in payment of advance tax For deferment of advance tax (section 234C). 13 Taxes Paid TAXES PAID 14 Amount payable (Enter if 12 is greater than ie, else enter o) 14 0 Refund (If ie is greater than 12, also give the bank account details in 9.6 The tax liabilities for normal provisions as well as MAT are calculated with surcharge and cess. The MAT credit in row "7" are calculated automatically using the prescribed algorithm, this is nothing but balancing figure i.e., the difference between tax liability as per normal provisions and MAT provisions. Both the above tax liabilities are calculated with surcharge and cess. These are the standard format, which are expected to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion u5JB must be applied. 9.6 The earlier judgments in the cases of Universal Medicare, Valmet India and W yeth Limited are decided relying on the ITR - 6 as applicable in those AYs. Similarly, we also apply the ITR 6 format as applicable to AY 2012-13 as stated above. Assessee has relied on the ITR - 6 format to arrive at the total liability as well as the MAT credit calculations and paid tax accordingly. In our view, the assessee had followed the procedure properly and the Assessing Officer had made the calculations applying his own interpretation or relied on the programme, we are not sure whether it is programme hitch or the interpretation of Assessing Officer was not in line with the calculations proposed in ITR-6. Therefore, we del ..... X X X X Extracts X X X X X X X X Extracts X X X X
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