As a family trust, the assessee was liable to file its return in form 5 and its return in Form 7. According to section 143(1)(a) of the Income-tax Act of 1961, the assessee received notice that, in the absence of information regarding a section 12A registration, the assessee’s income was subject to taxation as an association of persons or body of persons and that tax was assessed without providing basic exemption and slab benefits. In response to this notification, the assessee submitted a request for correction under section 154 to the Assessing Officer. The application was denied by the Assessing Officer. The commissioner (Appeals) rejected the appeal of the assessee on technical grounds. The assesee appealed further.

The tribunal held that the trust was incorporated for the benefit of Smt. L’s kin. The trust’s beneficiaries’ shares were calculated, and the chart for the assessment years 2016-17 to 2019-20 submitted by the assessee demonstrated that the assessee-family trust satisfied the requirements set forth as per the provisions of the Act for claiming basic exemption and slab benefit.  The AO was directed to reassess the same after giving the exemption and slab benefits as per the law. The assessee was directed to cooperate with the AO for filling the required information and verify certain claims. (AY.2014-15, 2015-16)