Case Law Details
Trans Engineers India Private Limited Vs DCIT (ITAT Pune)
CPC Can’t Ignore Finance Act Benefit Just Because ITR Had No Column – Pune ITAT Allows 25% Corporate Tax Rate Claim!
The Pune ITAT held that a domestic company cannot be denied the concessional 25% tax rate under the Finance Act, 2018 merely because the ITR form for AY 2018-19 did not contain a specific field to disclose turnover of FY 2015-16.
The assessee-company had paid tax at 25% contending that its turnover for FY 2015-16 was below ₹50 crore, thereby satisfying the condition prescribed in the First Schedule to the Finance Act, 2018. However, CPC processed the return by applying the normal corporate tax rate of 30% on the ground that no turnover details for FY 2015-16 were available in the return of income.
The Tribunal observed that the Finance Act clearly granted the benefit of lower tax rate to eligible domestic companies and simultaneously noted that the ITR form applicable for AY 2018-19 did not provide any dedicated column for furnishing turnover details of AY 2016-17/FY 2015-16. Therefore, the assessee could not be faulted merely because such particulars were absent in the return form itself.
Accordingly, the ITAT restored the matter to the Jurisdictional AO for verification of the audited financial statements and directed that if the turnover for FY 2015-16 is found to be below ₹50 crore, the assessee should be taxed only at 25% and not 30%.
FULL TEXT OF THE ORDER OF ITAT PUNE
The captioned appeal at the instance of assessee is against the order dated 22.12.2025 framed by Addl/JCIT(A)-3, Kolkata passed u/s.250 of the Income Tax Act, 1961 arising out of Intimation order dated 16.10.2019 passed u/s.143(1) of the Act.
2. The only grievance of the assessee is that the CPC erred in charging the income of the assessee applying tax @30% as against 25% without considering 1st Schedule of Finance Act 2018 providing that if the turnover of the assessee for F.Y.2015-16 does not exceed Rs.50 crore then the total income of the assessee is to be taxed @25%.
3. We have heard the rival contentions and perused the record placed before us and carefully gone through the paper book running into 128 pages and judicial pronouncements referred and relied on by Ld. Counsel by the assessee. The issue for consideration is regarding the rate of tax applicable on the assessee for A.Y.2018-19.
4. We note that the assessee is a Private Limited Company and it furnished return of income for A.Y.2018-19 on 31.10.2018 declaring total income of Rs.22.50 crore approximately. Same has been processed by CPC computing income at Rs.22.62 crore and tax has been charged at @30% as against 25% calculated and paid by the assessee. Assessee carried the matter before CIT(A) and gave reference to the 1st Schedule of Finance Act 2018 which provides that for the purpose of calculating tax for A.Y 2018-19, if the gross turnover of the assessee for F.Y. 2015-16 relevant to A.Y.2016-17 does not exceed Rs.50 crore, then the income of the assessee needs to be taxed @25% as against normal tax rate at @30%. During the course of hearing assessee furnished information about F.Y.2015-16 and stated that the turnover is less than Rs.50 crore. However, since there was no information available in the income tax return filed by the assessee for A.Y.2018-19 specifying the turnover for A.Y 2016-17 (F.Y.2015-16), ld. CIT(A) held that CPC has made no error in taxing the assessee @30%.
5. Before this Tribunal, the assessee has furnished the copy of paragraph (e) to 1stSchedule of Finance Act 2018 which clearly indicate that the rate of tax applicable on domestic company for A.Y.2018-19 shall be 25% if the total turnover or the gross receipts in F.Y.2015-16 does not exceed 50 crore rupees. Assessee has also furnished copy of audited balance sheet for F.Y.2015-16 as well as F.Y.2017-18. We also note that in the income tax return form which is applicable for A.Y. 2018 19 there is no specific column in which assessee can mention the details of turnover for A.Y.2016-17. This brings to a situation that on one hand the claim of the assessee is supported by Finance Act 2018 and on the other hand the Revenue’s case is that there is no error in the return processed by CPC because the CPC has processed as per the details furnished in the income tax return form applicable to the assessee.
6. We however are of the considered view that since Finance Act 2018 clearly provides the applicability of 25% tax rate for the domestic company having turnover less than Rs.50 crore for F.Y.2015-16 and the assessee is claiming that for F.Y.2015-16 as per the audited balance sheet, its turnover is less than Rs.50 crore, we deem it appropriate to restore this issue to the file of ld. Jurisdictional Assessing Officer who shall examine the claim of assessee after going to the audited financials and other details required to verify the total turnover or the gross receipts for the F.Y.2015-16 and if it is found that the turnover is not exceeding Rs.50 crore then the assessee should be subjected to tax @25% only. Impugned order is set aside and grounds of appeal raised by the assessee are allowed for statistical purposes.
7. In the result, appeal of the Assessee is allowed for statistical purpose.
Order pronounced on this 12th day of May, 2026.
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