| Question And Answer | |
|---|---|
| Subject: | The NEW SURCHARGE SCHEME vs (X) Auto calculation by CBC ? |
| Category: | Income-Tax |
| Querist: | vswaminathan |
| Answered by: | Research Team |
| Tags: | Surcharge |
| Date: | August 6, 2023 |
The NEW SURCHARGE scheme provides for levy of SC on income-tax on total income in the range between Rs 50,00,000 to one crore (first slab), and above. For the said first slab the prescribed rate of SC is 10%.
The computarised System in place (CPC), however, auto calculates SC , instead of @the respective slab rate depending on the ‘income range’,- on the rate applicable to over the outer limit of the slab. For examle , if total income in a given case exceeds the threshold limit for the next higher slab- one crore (to two crores), the rate applied is 15%, subject of course to certain ‘marginal relief’.
So much so, in such auto calculation, though clearly exempt, SC on income-tax on the sum of Rs. 50,00,000 (the threshold limit for the first slab) also gets charged.
Aside: Does this not imply that there is a fundamental deficiency in theSYSTEM ?!
As per information gathered from limited known circles, it appears that, the surcharge so auto calculated has not at all been challenged but accepted.
Solicit EXPERT’s opinion whether or not the auto calculation of SC in such manner as aforesaid is in contravention / violation of the NEW SURCHARGE scheme-if critically studied and mindfully analysed?
: Joint representation is needed. It may be desirable to take up the issue the Bombay Chartered Accountant’s Society or the Chamber of Tax consultants Mumbai.
Attn: ADMN. To ADD: The query raised is of elevance to all past years in which the NEW SCHEME of SURCHARGE- in particular, providing that no surcharge should be levied on income-tax on a sum of Rs.50,00,000 included in total income -tax, came be introduced_ AGREE?!
Premised so, no need to emphasise that excess SC levied and collected , wrongly so, requires to be refunded by the REVENUE, suo moto,without requiring each of the concerned taxpayers to take any steps/action in this regard.
That is precisely the reason why the ADMN. has been urged to take up and pursue the matter, in the larger ‘PUBLIC interest’ with the EXECUTIVE in a joint representation, vide the e’mail sent as per CC below:
ADMN. CC of the mail since sent- (a copy of the same message as earlier sent via FB)
ADMN: Pending EXPERT’s opinion, one more FEED -input supplied @https://www.linkedin.com/feed/update/urn:li:activity:7096308127913971713/?commentUrn=urn%3Ali%3Acomment%3A(activity%3A7096308127913971713%2C7096338277774884864)&fbclid=IwAR2bL3tJ8Jn5kYHqDAcDfsM6t__2k6DnDnAJHmlBOQ6f1kFQSEfkgBXJOfk
courtesy
MORE INPUT: To cover added / peculiar concerns, if in a case the chargeable total income includes, besides Salary Income,income chargable under the head- LTCG at the reduced spl. rate of income-tax (20%)
vide the Post @https://www.linkedin.com/posts/vswaminathan13_httpslnkdinde5pctw-in-addition-activity-7097554099352604672-N5Rp?utm_source=share&utm_medium=member_desktop
ADMN: Await to hear whether, as rquested for,you have taken any step for making a Reresentation to the FM to look into the noted/pinpointed deficiency in the SYSTEM (CPC); in the result, excess surcharge has been auto calculated and collected from those taxpayers, for the AYs 2020-21 to 2023-24 , whose income range falls between the slabs – first slab upto 1 crore rupees, and the next slabs upto and above crores.
Will appreciate a line in ack., and confimation of the steps taken thus far.
courtesy
ADMN: Attention is invited to the supplementary posted restating/reiterating the request for a joint REPRESENTATION to the FM/CBDT.
Justification stands to be readily gathered from the statistics of pendency before the itat, so also in first appeals before CIT(A)s, so generously provided/given publicity @ https://itatonline.org/digest/qa/how-many-cases-are-pending/
Hope the utmost urgency for a joint representation will be realised/fully appreciated , without fail and on a topmost priority basis; instead of impudently ramaining muted/ waiting for further otherweise inevitable developments,leading to a fresh escalation of pendency.
One MORE UPDATE > https://www.linkedin.com/pulse/new-surcharge-scheme-contd-swaminathan-venkataraman/?published=t
The viewpoints / observations shared, it needs to be specially noted,are of relevance to, besides those for whom the rate of income-tax preascribed is a ‘fixed rate’, also to whom the tax treaty implications require consideration !?
Incidentally, provision for tax liability is one of the material components for Book Keeping / Accounting purposes; so also for Tax Audit. It is, therefore, imperative for CAs engaged for statutory audit and tax audit not to skirt or oversight for meeting the disclosure requirements !
courtesy
ADD-on (ATTN: ADMN): Look up the query raised @ https://itatonline.org/digest/qa/surcharge-in-case-if-maximum-marginal-rate-for-aop/
and the comments posted , pending expert’s Answer. That adds credence/ one more GOOD PRACTICAL REASON, founded on pure COMMON SENSE, as to why it might be PRUDENT /MOST SENSIBLE to have forceful REPRESENTATIONS made, JOINTLY and SEVERALLY, to the FM/ CBDT to LOOK INTO THE Deficiency in the SYSTEM (CPC) and PLUG IN THE necessary CORRECTIVES AT THE SOONEST. UNLESS and Until THAT HAS BEEN DONE, by any thinking, AUTO CALCULATION OF SURCHARGE MUST BE HALTED; so also processing of tax returns filed by taxpayers in the income range 50 lakhs to over 5 crore rupees and ISSUE of INTIMATIONS in such cases, NEED to be STOPPED!?
Reply
^ https://www.linkedin.com/pulse/new-surcharge-scheme-addendum-swaminathan-venkataraman/?trackingId=rpXqBd08TPil2h53uuO85g%3D%3D
On inquiry,have not been able to get any confirmation, – except from one reliable source,-that CPC has not started/or is not known to have started sending INTIMATIONS for AY2023-24 to taxpayers in the income range 50 lakhs to 5 crore rupees and over .
It is is a commonly known fact/reality that the REVENUE has never acted so soon- or can even be imagined or prudently be expected to act so fast, -especially in such matters entailing taxpayers’ serious concerns/grave regrets!
Granting so,however,in cases of refund claims,taxpayers may consider steps to have the refunds expedited. If so advised and decided, the CPC may have to be urged, by sending a e’mail, to grant, at least tentativly,the refund inclusive of the excess surcharge auto calculated and collected by reason of not taking into account the threshold exemption of surcharge on a sum 50 lakhs rupees, -which is an apparent mistake calling for suo motu retification !?
courtesy
In continuing attempt to maintain and build up the momentum for the mission on hand :
https://www.facebook.com/swaminathanv3/posts/pfbid027fgmcfugs4vd9droj8qhxfgjacg15su2dky1n17zu6gltazkq6z5c4vksc93tfftl
An UPDATE (to amplify the concerns):
According to information received from certain other source personally known,CPC has already started processing and been sending INTIMATIONS for AY 2023-24. Am told that in doing so, though made aware of,none of the FEED given has even been looked into and remedial action taken.
If so, no need to add: Now that the Indian Revenue has thus far failed to even take any conscious note of the SYSTEM DEFICIENCY, the professionals in the interests of both themselves (the FIRMs)and of their clientele might have to , in consultation with an EMINENT reliable counsel, consider and decide filing a WRIT PETITION straighaway in the Supreme Court. More importantly, as an interim relief,a STAY must be sought and obtained. As, otherWISE,- it will be appreciated that, any more processing of the tax returns and issue of INTIMATIONS by CPC could obviously add to the already obtaining chaos and confusion, of a national/international magnitude – AGREE ?
YET another UPDATE >https://www.linkedin.com/feed/update/urn:li:activity:7120970776417107968?utm_source=share&utm_medium=member_desktop
TEXT of its contents already shared with the ADMN.
Reply