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Minimum alternate tax doesn't include surcharge and education cess

The assessee-company received intimation under Sec. 143(1) where the claim of the MAT credit in respect of surcharge and education and secondary & higher education cess (cess) were disallowed. On appeal, the CIT(A) rejected the assessee's plea on the reasoning that Sec. 115JAA allows credit for the income-tax only, and income-tax does not include surcharge and cess as per Sec. 2(43). Further, it held that wherever required the legislation has provided that income-tax shall be increased by amount of surcharge and cess.

On appeal, the Tribunal held in favour of revenue as under:
1. Wherever statute has intended that income-tax shall include surcharge and cess, it has specifically provided so like it has provided in Explanation 2 to section 115JB;

2. Even Form 29B, which is filed along with return of income where MAT is applicable, does not provide for levy of surcharge and cess; and

3. Sec. 115JB does not specify that the income-tax shall be increased by amount of surcharge and cess, thus, the MAT payable under section 115JB includes only income-tax.
In view of above, it was held that if only income-tax is paid under the provisions of section 115JB, the entitlement to tax credit under section 115JAA would be for income-tax only and not for surcharge and cess - Richa Global Exports Pvt. Ltd. v. ACIT [2012] 25 taxmann.com 1 (Delhi - Trib.)

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