ASHOK PATNI FAMILY TRUST,PUNE V. THE ASST./DY. COMMISSIONER OF INCOME TAX, CIRCLE-7, PUNE

ITA 2781/PUN/2024

AI Insights

The case involves the Ashok Patni Family Trust, which appealed against the order of the CIT(A), Faridabad, concerning an intimation under section 143(1) of the Income Tax Act for the Assessment Year 2022-23. The primary contention was the incorrect application of the surcharge rate on the trust's income. The trust argued that the surcharge should be 10%, referencing a decision by the Hon'ble Special Bench, Mumbai in the case of Araadhya Jain Trust vs. ITO, which supported their claim. The Departmental Representative defended the CIT(A)'s decision, which upheld a 37% surcharge. The Tribunal, after reviewing the cited judgment and the applicable tax slabs, agreed with the appellant and corrected the surcharge rate.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 653224 (ITAT-PUNE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-06-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2022-2023
• Other Referred Cases: Araadhya Jain Trust vs. ITO
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S. SADANANDA SINGH
• Assessee Lawyers: C. H. NANIWADEKAR

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “SMC”, PUNE BEFORE SHRI MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.2781/PUN/2024 िनधाᭅरण वषᭅ / Assessment Year : 2022-23 Ashok Patni Family Trust, S.No.1A, F-1, Irani Market Compound, Yerwada, Pune- 411006. PAN : AAGTA3844A Vs. A/DCIT, Circle-7, Pune. Appellant Respondent आदेश / ORDER PER MANISH BORAD, AM: This appeal filed at the instance of assessee is directed against the order of Ld. Addl./JCIT(A), Faridabad [‘Ld. CIT(A)’] dated 25.11.2024 which is arising out of the intimation u/s 143(1) of the Act for Assessment Year 2022-23 framed on 16.03.2023 by the DCIT, CPC, Bengaluru. 2. The only grievance of the assessee is that Ld. CIT(A) erred in confirming the action of CPC levying surcharge of 37% as against the applicable rate of 10% based upon the income of the assessee. 3. At the outset, Ld. Counsel for the assessee stated that the issue stands squarely covered by the decision of the Hon’ble Special Assessee by : Shri C.H. Naniwadekar Revenue by : Shri S. Sadananda Singh Date of hearing : 18.06.2025 Date of pronouncement : 20.06.2025 ITA No.2781/PUN/2024 2 Bench, Mumbai in the case of Araadhya Jain Trust vs. ITO (ITA No.4272/Mum/2024 dated 09.04.2025) and in light of said judgement the assessee deserves to succeed and surcharge is leviable at the rate of 10% only. 4. On the other hand, Ld. Departmental Representative supported the order of Ld. CIT(A). 5. I have heard rival contentions and perused the records placed before me. The only issue is regarding the rate of surcharge leviable on the tax payable by the assessee. The assessee is a family trust and return of income for A.Y. 2022-13 furnished on 26.12.2022 declaring total income of Rs.52,00,660/-. While computing the tax liability, the assessee has paid surcharge at the rate of 10%. In the intimation u/s 143(1), the CPC while processing the return levied the surcharge at the maximum rate of 37%. The assessee challenged the said action of CPC before Ld. CIT(A) but failed to succeed. Before me, Ld. Counsel for the assessee has referred to the judgement of Hon’ble Special Bench, Mumbai in the case of Araadhya Jain Trust (supra). I have carefully gone through the said judgement and find that the Hon’ble Special Bench, Mumbai held that the surcharge is to be levied as per income tax slab as provided in Paragraph A, Part 1, First Schedule and as per first slab, if income exceeds Rs.50 lakhs but do not exceed Rs.1 crore including ITA No.2781/PUN/2024 3 the income by way of dividend or income under the provisions of section 111A, section 112 and section 112A of the Act surcharge is leviable at the rate of 10%. Though there are three more slabs but since the case of the assessee falls under the first slab, I am therefore of the considered opinion that the assessee is required to pay surcharge at the rate of 10% and Ld. CIT(A) erred in confirming the action of the CPC of wrongly levying surcharge at the rate of 37%. Finding of Ld. CIT(A) is set-aside and the grounds of appeal raised by the assessee are allowed. 6. In the result, the appeal of the assessee is allowed. Order pronounced on 20th day of June, 2025. Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 20th June, 2025. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Addl./JCIT(A), Faridabad. 4. The Pr. CIT/CIT concerned. 5. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “SMC” बᱶच, पुणे / DR, ITAT, “SMC” Bench, Pune. 6. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. "