N K Infra JV Vs ADIT, CPC, Bengaluru / ITO (ITAT Mumbai)
The Income Tax Appellate Tribunal (ITAT), Mumbai bench, has ruled in favor of a partnership firm, N K Infra JV, in its dispute against the Additional Director of Income Tax (ADIT), Centralized Processing Centre (CPC), Bengaluru. The case, which centered on the incorrect application of a surcharge on the firm’s income, was decided on July 23, 2025.
The core of the dispute arose after the assessee, a partnership firm, filed its income tax return for the assessment year 2023-24, declaring a total taxable income of ₹10,02,420. Following the tax laws, no surcharge was applicable as this amount was below the ₹50 lakh threshold. However, the CPC, while processing the return, levied a surcharge of 37%, amounting to ₹1,11,269, along with a consequent cess of ₹4,451. This action led to a significant increase in the firm’s total tax liability, from the initially calculated ₹3,12,755 to ₹24,28,475.
Aggrieved by this discrepancy, the assessee appealed to the Commissioner of Income Tax (Appeals) [CIT(A)]. The CIT(A), however, dismissed the appeal, stating that the original intimation had been rectified. The assessee’s representative argued that despite this alleged rectification, the surcharge had not been removed. Furthermore, it was contended that the CIT(A) had passed the order without issuing a notice or granting the assessee an opportunity to be heard, as mandated by legal procedure.
