Assessee-trust was declared by one\u00a0 Smt. Pashiben Shambhubhai Prjapati\u00a0 for the benefit her sons namely shri Dhulabhai Shambhibhai Prjapati and Shri Ashokbhai Shambhu Prajapati \u00a0\u00a0through her will for benefit of her sons and their families. Assessing Officer applied maximum marginal rate of taxes on income declared by assessee on grounds that trust was a private discretionary trust where shares of beneficiaries were indeterminate or unknown. Further, deduction under Chapter VI-A were also denied. CIT(A) up held the order of the AO. On appeal the Tribunal held that\u00a0 since beneficiaries under trust were defined, i.e., two sons of Smt. Pashiben Shambhubhai Prjapati\u00a0 and their families but specific share of each beneficiary on whose behalf income was received by trustees were indetermined and unknown, as same was not specified in Will, section 164(1) read with clause (ii) to Explanation (1) to section 164 would become relevant and relevant income would be chargeable to tax at maximum marginal rate. However since trust declared by Smt. Pashiben Shambhubhai Prjapati\u00a0 \u00a0was only trust declared by her, income of assessee would be chargeable to be taxed under provisions of section 164(1) read with clause (ii) of first proviso to section 164(1), as it were total income of an association of person (AOP). Deeming fiction created under section 164(1) read with clause (ii) of first proviso to section 164(1), that tax would be charged on relevant income, as if it were total income of an association of person (AOP) could not extend to an extent of denial of deduction under sections 80C and 80TTA which is otherwise available to individuals, as all beneficiaries under instant trust were individuals. (AY. 2021-22)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 164 : Representative assessees-Charge of tax-Private discretionary trust-Shares of beneficiaries were indeterminate or unknown-Trust under will-Assessable as total income of an Association of persons-Deeming fiction cannot extend to an extent denial of deduction-Chapter VI-A-Deduction under section 80C and 80TT is available. [S. 2(31), 80C, 8OTT,160(1)(iv), 164(1)(ii), 167B] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-51212","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-dk0","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/51212","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=51212"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/51212\/revisions"}],"predecessor-version":[{"id":51213,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/51212\/revisions\/51213"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=51212"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=51212"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=51212"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}