Concessional regimes typically forfeit Chapter VI-A and most exemptions.
13. Refund / credit
MAT credit u/s 115JAA carries forward 15 years; AMT credit u/s 115JD.
14. Return / disclosure reporting
Form 10-IEA / 10-IC / 10-ID / 29B as applicable.
15. Penalty exposure
Wrong opt-in / opt-out — assessment proceedings; s. 270A applicability.
16. Prosecution exposure
Section 276C — wilful evasion (criminal).
17. Cross-statute interplay
International tax — DTAA Article 24 (non-discrimination) interplay.
18. Repeal & saving — 1961 → 2025
Section 536 saves opt-in elections; 2025 Act preserves special regimes.
HISTORICAL CONTEXT
Section 115BAA was inserted by the Taxation Laws (Amendment) Act, 2019 (after the Ordinance promulgated on 20-Sep-2019) as a flagship corporate tax-rate cut — reducing domestic corporate tax from 30% (or 25% for smaller cos) to 22%, with surcharge and cess bringing the effective rate to approximately 25.17%. The cut was intended to enhance India's competitive positioning in attracting investment.
Section 115BAA is structured as a once-for-all opt-in regime. The company forfeits most exemption / deduction provisions (Chapter VI-A except s. 80JJAA and 80M; additional depreciation; specified business deductions; set-off of attributable losses) in exchange for the 22% rate. Crucially, MAT (s. 115JB) is also rendered inapplicable to s. 115BAA companies (s. 115JB(5A)).
The CBDT Circular 6/2022 provided extension / condonation for delayed Form 10-IC filings, recognising procedural lapses in the transitional period. The ITAT in cases like Trishna Industries and Ekta Diamonds has applied a substantial-compliance approach for late Form 10-IC, drawing on Hexaware-type bona-fide defences. The provision continues to be the dominant choice for established corporates with limited Chapter VI-A dependency.
The transition to the Income-tax Act, 2025 preserves the special tax regime architecture; opt-in elections continue under section 536 saving.
FINANCE ACT AMENDMENT TIMELINE
■ TLAA 2019 — Section 115BAA inserted (effective AY 2020-21+).
■ TLAA 2019 — Section 115BAB inserted (parallel for new manufacturing).
■ FA 2020 — Conforming amendments.
■ FA 2021 — Section 80M conforming changes.
■ FA 2022 — Procedural updates.
■ CBDT Circular 6/2022 — Form 10-IC condonation framework.
Facts. The Department sought to apply a surcharge provision retrospectively to block-period assessments. The assessee contended that the amendment was substantive and could not have retrospective operation absent express legislative direction.
Issue. Whether amendments to taxing statutes operate prospectively unless the legislature has expressly or by necessary implication conferred retrospective effect.
HELD. The Constitution Bench reaffirmed the general rule against retrospectivity of taxing statutes. A taxing provision must be construed prospectively unless the language compels otherwise; mere insertion or substitution by amendment is not sufficient to deny vested rights.
“Of the various rules guiding how a legislation has to be interpreted, one established rule is that unless a contrary intention appears, a legislation is presumed not to be intended to have a retrospective operation.”
Relevance. Anchor authority for any argument that an amendment to a charging or computational provision must apply only from the AY notified — useful in transitional disputes around FA 2025 and the 1961 → 2025 changeover.
▸ Mathuram Agrawal v. State of Madhya Pradesh (1999) 8 SCC 667 ; (2000) 1 SCR 1 (Supreme Court)
Facts. A municipal levy was challenged on the ground that the charging provision did not clearly specify the rate, the persons charged, and the measure of tax.
Issue. Whether a tax can be imposed in the absence of a clear, unambiguous charging provision identifying the subject, measure, rate, and incidence.
HELD. Article 265 demands that tax be levied only by clear authority of law. The four components — taxable event, person, rate, and measure — must be clearly discernible from the charging provision; ambiguity is fatal to the levy.
“The intention of the Legislature in a taxation statute is to be gathered from the language of the provisions, particularly when the language is plain and unambiguous. In a taxing Act it is not possible to assume any intention or governing purpose other than what is given expression to.”
Relevance. Foundational authority on the rigour required of charging sections — underpins arguments that ambiguous deeming fictions, surcharge formulas, and rate prescriptions must be strictly construed.
Facts. Section 52(2) (since deleted) deemed sale consideration to be FMV where FMV exceeded the declared consideration by 15%. The Department applied it on a literal reading even when the assessee had not in fact received more than the declared price.
Issue. Whether a deeming provision in a charging schema can be construed literally where its plain reading produces a result manifestly contrary to legislative object.
HELD. The Court read down section 52(2) to apply only where the assessee had actually received consideration in excess of the declared sum. A literal construction yielding absurd or unjust results must yield to an object-based interpretation; the CBDT's contemporaneous Circular No. 96 was held binding on the Revenue.
“It is well settled that a literal construction of a statutory provision ought not to be adopted if it produces a manifestly unjust result… Where a literal construction creates an anomaly, the courts will adopt that construction which avoids the anomaly.”
Relevance. Anchor authority for purposive construction of deeming fictions across the 1961 Act — applies wherever a deeming clause (e.g., s. 50C, s. 56(2)(x), s. 2(22)(e)) yields a result contrary to legislative purpose.
▸ Calcutta Discount Co. Ltd. v. Income-tax Officer, Companies District I, Calcutta (1961) 41 ITR 191 ; AIR 1961 SC 372 (Supreme Court — Constitution Bench)
Facts. The assessee challenged a section 34 reassessment notice on the ground that the ITO had no jurisdictional foundation to reopen; the Revenue contended that the writ jurisdiction was ousted by the statutory appeals scheme.
Issue. Whether the High Court's jurisdiction under Article 226 is ousted by the existence of a statutory remedy where the reassessment notice itself lacks jurisdictional foundation.
HELD. Existence of an alternative statutory remedy does not oust Article 226 jurisdiction where the impugned action is wholly without jurisdiction. The burden is on the assessee to disclose all primary facts; the duty to draw inferences rests with the assessing officer.
“The duty of the assessee in every case is to disclose fully and truly all primary facts. Once all primary facts are before the assessing authority, he requires no further assistance by way of disclosure.”
Relevance. Foundational on the boundary between assessee's disclosure duty and the ITO's investigative duty — supports challenges to s. 147/148 (1961) / s. 281 (2025) reassessments on jurisdictional grounds.
▸ Commissioner of Income-tax v. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 ; (2010) 11 SCC 762 (Supreme Court)
Facts. The assessee claimed deduction of interest on borrowings used for investment in shares yielding tax-free dividend. The deduction was disallowed under section 14A. The Department levied penalty under section 271(1)(c) for concealment / inaccurate particulars.
Issue. Whether a mere disallowance of a deduction — without any falsehood in the particulars furnished — attracts penalty under section 271(1)(c).
HELD. Penalty under section 271(1)(c) is not attracted merely because a claim for deduction is disallowed. The assessee's claim must be shown to be false, frivolous, or made without bona fides; mere unsustainability does not amount to concealment or furnishing of inaccurate particulars.
“A mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the Return cannot amount to inaccurate particulars.”
Relevance. Cornerstone authority for resisting penalty under section 271(1)(c) / section 270A — applies to disallowed deductions, transfer-pricing adjustments, head-of-income re-characterisations where a bona-fide claim was made.
CBDT CIRCULARS — ECOSYSTEM
▸ CBDT Circular No. 14(XL-35) of 1955 dated 11 April 1955
Subject. Duty of officers to assist assessees in claiming and securing relief
Substance. Foundational circular directing that the AO should not exploit assessee ignorance to deny legitimate reliefs; officer is required to draw attention to refunds or reliefs to which the assessee is entitled. The circular has been judicially noted in several appellate decisions and remains operative for first-appellate practice.
Substance. Explained the FA 1987 / FA 1989 amendments unifying the previous year with the financial year preceding the AY, including transitional provisions for assessees with different accounting years. Useful in any controversy on the timing of accrual / chargeability for early post-1989 AYs.
▸ CBDT Circular No. 5 of 2014 dated 11 February 2014
Subject. Section 14A — dis-allowance even where no exempt income earned (since modulated)
Substance. Initially directed AOs to apply Rule 8D disallowance under section 14A even where no exempt income was earned in the year; subsequently modulated by Cheminvest (Del HC) and Maxopp (SC). FA 2022 amendment to section 14A re-asserted the position but remains under litigation.
▸ CBDT Circular No. 6 of 2019 dated 20 March 2019
Subject. Withdrawal of low-tax-effect appeals — monetary thresholds
Substance. Revised monetary thresholds for departmental appeals — ITAT (Rs 50L), HC (Rs 1 Cr), SC (Rs 2 Cr); subsequently further revised. Operates as a non-statutory limitation on the Revenue's appellate engagement, binding under section 119.
Substance. Procedural guidance for AOs handling transitional reassessment notices for AYs 2013-14 to 2017-18 affected by Ashish Agarwal and Rajeev Bansal. Sets out the form of section 148A inquiry, time-bar calculation under TOLA, and JAO/FAO jurisdiction in faceless cases.
WORKED EXAMPLES
Illustration — Illustration 1
Facts. Domestic Co Z — book profit Rs 10 cr; taxable income Rs 8 cr after deductions.
STATUTORY ARCHITECTURE — 18-ROW MAP
01. Section & marginal note
Section 115BAA — Domestic Company Concessional 22% — Chapter XII (Special Tax Regimes).
02. Sub-section structure
Per operative text — typically rate + conditions + carve-outs / forfeitures.
03. Operative trigger
Opt-in / default election; satisfaction of eligibility conditions.
04. Persons affected
Per section — individual / HUF / firm / company / co-op.
05. Time anchor — PY / AY
Annual election (some regimes) or once-for-all (others).
06. Income anchor
Total income / book profit / undisclosed income — section-specific.
07. Residential-status nexus
Generally for resident assessees; NR with specified concessions.
08. Rate / charge mechanism
Special rate — 22% / 15% / 60% / 15% MAT / new-regime slabs.
09. TDS / TCS interaction
TDS at applicable rate; regime choice does not affect TDS rate.
10. Advance-tax obligation
Advance tax payable per regime; s. 234C interest on instalment shortfall.
11. Presumptive provisions
Interaction with s. 44AD / 44ADA / 44AE.
12. Exemption / deduction mechanism
Concessional regimes typically forfeit Chapter VI-A and most exemptions.
13. Refund / credit
MAT credit u/s 115JAA carries forward 15 years; AMT credit u/s 115JD.
14. Return / disclosure reporting
Form 10-IEA / 10-IC / 10-ID / 29B as applicable.
15. Penalty exposure
Wrong opt-in / opt-out — assessment proceedings; s. 270A applicability.
16. Prosecution exposure
Section 276C — wilful evasion (criminal).
17. Cross-statute interplay
International tax — DTAA Article 24 (non-discrimination) interplay.
18. Repeal & saving — 1961 → 2025
Section 536 saves opt-in elections; 2025 Act preserves special regimes.
HISTORICAL CONTEXT
Section 115BAA was inserted by the Taxation Laws (Amendment) Act, 2019 (after the Ordinance promulgated on 20-Sep-2019) as a flagship corporate tax-rate cut — reducing domestic corporate tax from 30% (or 25% for smaller cos) to 22%, with surcharge and cess bringing the effective rate to approximately 25.17%. The cut was intended to enhance India's competitive positioning in attracting investment.
Section 115BAA is structured as a once-for-all opt-in regime. The company forfeits most exemption / deduction provisions (Chapter VI-A except s. 80JJAA and 80M; additional depreciation; specified business deductions; set-off of attributable losses) in exchange for the 22% rate. Crucially, MAT (s. 115JB) is also rendered inapplicable to s. 115BAA companies (s. 115JB(5A)).
The CBDT Circular 6/2022 provided extension / condonation for delayed Form 10-IC filings, recognising procedural lapses in the transitional period. The ITAT in cases like Trishna Industries and Ekta Diamonds has applied a substantial-compliance approach for late Form 10-IC, drawing on Hexaware-type bona-fide defences. The provision continues to be the dominant choice for established corporates with limited Chapter VI-A dependency.
The transition to the Income-tax Act, 2025 preserves the special tax regime architecture; opt-in elections continue under section 536 saving.
FINANCE ACT AMENDMENT TIMELINE
■ TLAA 2019 — Section 115BAA inserted (effective AY 2020-21+).
■ TLAA 2019 — Section 115BAB inserted (parallel for new manufacturing).
■ FA 2020 — Conforming amendments.
■ FA 2021 — Section 80M conforming changes.
■ FA 2022 — Procedural updates.
■ CBDT Circular 6/2022 — Form 10-IC condonation framework.
■ FA 2023 — Conforming amendments.
■ FA 2024 — Updated framework.
■ ITA 2025 — Section 115BAA preserved.
JUDICIAL EVOLUTION — VERIFIED LANDMARK AUTHORITIES
▸ Commissioner of Income-tax v. Vatika Township Pvt. Ltd. (2014) 367 ITR 466 ; (2015) 1 SCC 1 (Supreme Court — 5-Judge Constitution Bench)
Facts. The Department sought to apply a surcharge provision retrospectively to block-period assessments. The assessee contended that the amendment was substantive and could not have retrospective operation absent express legislative direction.
Issue. Whether amendments to taxing statutes operate prospectively unless the legislature has expressly or by necessary implication conferred retrospective effect.
HELD. The Constitution Bench reaffirmed the general rule against retrospectivity of taxing statutes. A taxing provision must be construed prospectively unless the language compels otherwise; mere insertion or substitution by amendment is not sufficient to deny vested rights.
“Of the various rules guiding how a legislation has to be interpreted, one established rule is that unless a contrary intention appears, a legislation is presumed not to be intended to have a retrospective operation.”
Relevance. Anchor authority for any argument that an amendment to a charging or computational provision must apply only from the AY notified — useful in transitional disputes around FA 2025 and the 1961 → 2025 changeover.
▸ Mathuram Agrawal v. State of Madhya Pradesh (1999) 8 SCC 667 ; (2000) 1 SCR 1 (Supreme Court)
Facts. A municipal levy was challenged on the ground that the charging provision did not clearly specify the rate, the persons charged, and the measure of tax.
Issue. Whether a tax can be imposed in the absence of a clear, unambiguous charging provision identifying the subject, measure, rate, and incidence.
HELD. Article 265 demands that tax be levied only by clear authority of law. The four components — taxable event, person, rate, and measure — must be clearly discernible from the charging provision; ambiguity is fatal to the levy.
“The intention of the Legislature in a taxation statute is to be gathered from the language of the provisions, particularly when the language is plain and unambiguous. In a taxing Act it is not possible to assume any intention or governing purpose other than what is given expression to.”
Relevance. Foundational authority on the rigour required of charging sections — underpins arguments that ambiguous deeming fictions, surcharge formulas, and rate prescriptions must be strictly construed.
▸ K.P. Varghese v. Income-tax Officer, Ernakulam (1981) 131 ITR 597 ; (1981) 4 SCC 173 (Supreme Court — 3-Judge Bench)
Facts. Section 52(2) (since deleted) deemed sale consideration to be FMV where FMV exceeded the declared consideration by 15%. The Department applied it on a literal reading even when the assessee had not in fact received more than the declared price.
Issue. Whether a deeming provision in a charging schema can be construed literally where its plain reading produces a result manifestly contrary to legislative object.
HELD. The Court read down section 52(2) to apply only where the assessee had actually received consideration in excess of the declared sum. A literal construction yielding absurd or unjust results must yield to an object-based interpretation; the CBDT's contemporaneous Circular No. 96 was held binding on the Revenue.
“It is well settled that a literal construction of a statutory provision ought not to be adopted if it produces a manifestly unjust result… Where a literal construction creates an anomaly, the courts will adopt that construction which avoids the anomaly.”
Relevance. Anchor authority for purposive construction of deeming fictions across the 1961 Act — applies wherever a deeming clause (e.g., s. 50C, s. 56(2)(x), s. 2(22)(e)) yields a result contrary to legislative purpose.
▸ Calcutta Discount Co. Ltd. v. Income-tax Officer, Companies District I, Calcutta (1961) 41 ITR 191 ; AIR 1961 SC 372 (Supreme Court — Constitution Bench)
Facts. The assessee challenged a section 34 reassessment notice on the ground that the ITO had no jurisdictional foundation to reopen; the Revenue contended that the writ jurisdiction was ousted by the statutory appeals scheme.
Issue. Whether the High Court's jurisdiction under Article 226 is ousted by the existence of a statutory remedy where the reassessment notice itself lacks jurisdictional foundation.
HELD. Existence of an alternative statutory remedy does not oust Article 226 jurisdiction where the impugned action is wholly without jurisdiction. The burden is on the assessee to disclose all primary facts; the duty to draw inferences rests with the assessing officer.
“The duty of the assessee in every case is to disclose fully and truly all primary facts. Once all primary facts are before the assessing authority, he requires no further assistance by way of disclosure.”
Relevance. Foundational on the boundary between assessee's disclosure duty and the ITO's investigative duty — supports challenges to s. 147/148 (1961) / s. 281 (2025) reassessments on jurisdictional grounds.
▸ Commissioner of Income-tax v. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 ; (2010) 11 SCC 762 (Supreme Court)
Facts. The assessee claimed deduction of interest on borrowings used for investment in shares yielding tax-free dividend. The deduction was disallowed under section 14A. The Department levied penalty under section 271(1)(c) for concealment / inaccurate particulars.
Issue. Whether a mere disallowance of a deduction — without any falsehood in the particulars furnished — attracts penalty under section 271(1)(c).
HELD. Penalty under section 271(1)(c) is not attracted merely because a claim for deduction is disallowed. The assessee's claim must be shown to be false, frivolous, or made without bona fides; mere unsustainability does not amount to concealment or furnishing of inaccurate particulars.
“A mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the Return cannot amount to inaccurate particulars.”
Relevance. Cornerstone authority for resisting penalty under section 271(1)(c) / section 270A — applies to disallowed deductions, transfer-pricing adjustments, head-of-income re-characterisations where a bona-fide claim was made.
CBDT CIRCULARS — ECOSYSTEM
▸ CBDT Circular No. 14(XL-35) of 1955 dated 11 April 1955
Subject. Duty of officers to assist assessees in claiming and securing relief
Substance. Foundational circular directing that the AO should not exploit assessee ignorance to deny legitimate reliefs; officer is required to draw attention to refunds or reliefs to which the assessee is entitled. The circular has been judicially noted in several appellate decisions and remains operative for first-appellate practice.
▸ CBDT Circular No. 549 dated 31 October 1989
Subject. Explanatory notes — Finance Act 1989 amendments (incl. PY unification)
Substance. Explained the FA 1987 / FA 1989 amendments unifying the previous year with the financial year preceding the AY, including transitional provisions for assessees with different accounting years. Useful in any controversy on the timing of accrual / chargeability for early post-1989 AYs.
▸ CBDT Circular No. 5 of 2014 dated 11 February 2014
Subject. Section 14A — dis-allowance even where no exempt income earned (since modulated)
Substance. Initially directed AOs to apply Rule 8D disallowance under section 14A even where no exempt income was earned in the year; subsequently modulated by Cheminvest (Del HC) and Maxopp (SC). FA 2022 amendment to section 14A re-asserted the position but remains under litigation.
▸ CBDT Circular No. 6 of 2019 dated 20 March 2019
Subject. Withdrawal of low-tax-effect appeals — monetary thresholds
Substance. Revised monetary thresholds for departmental appeals — ITAT (Rs 50L), HC (Rs 1 Cr), SC (Rs 2 Cr); subsequently further revised. Operates as a non-statutory limitation on the Revenue's appellate engagement, binding under section 119.
▸ CBDT Circular No. 5 of 2024 dated 15 March 2024
Subject. Procedure for transitional reassessment notices post-Ashish Agarwal / Rajeev Bansal
Substance. Procedural guidance for AOs handling transitional reassessment notices for AYs 2013-14 to 2017-18 affected by Ashish Agarwal and Rajeev Bansal. Sets out the form of section 148A inquiry, time-bar calculation under TOLA, and JAO/FAO jurisdiction in faceless cases.
WORKED EXAMPLES
Illustration — Illustration 1
Facts. Domestic Co Z — book profit Rs 10 cr; taxable income Rs 8 cr after deductions.
Computation.
Old regime (30%): Rs 8 cr × 30% + 12% surcharge + 4% cess ~ Rs 2.78 cr.
MAT 15% on Rs 10 cr book profit + surcharge + cess ~ Rs 1.74 cr.
Section 115BAA: Rs 8 cr × 22% × 1.1 surcharge × 1.04 cess = Rs 2.01 cr.
No MAT applicable.
Result. Section 115BAA saves Rs 77 L vs old regime.
Illustration — Illustration 2
Facts. Domestic Co Y — opt-in s. 115BAA in AY 2024-25.
Computation.
Once-for-all: cannot revoke for subsequent years (subject to surrender provisions).
Lose Chapter VI-A (except s.
80JJAA / 80M), additional depreciation, set-off of forfeited losses.
Result. Once-for-all opt-in; irrevocable.
Illustration — Illustration 3
Facts. Co W has carried-forward loss attributable to s. 80IA deduction.
Computation.
Section 115BAA(2)(ii) — loss attributable to forfeited deductions cannot be set off.
Quantify loss-attribution carefully before opt-in.
Result. Loss attributable to s. 80IA cannot be set off post-115BAA opt-in.
Illustration — Illustration 4
Facts. Co V missed Form 10-IC filing for AY 2024-25.
Computation.
Section 115BAA(5) — strict due-date u/s 139(1).
Belated form: ITAT cases (Trishna Industries / Ekta Diamonds) suggest substantial-compliance defence; CBDT Circular 6/2022 condonation in genuine cases.
Result. Late Form 10-IC — defence: ITAT precedents + Circular 6/2022.
Illustration — Illustration 5
Facts. Co T pays dividend Rs 50 L; claims s. 80M deduction.
Computation.
Section 80M (dividend received from another co) available even in s.
115BAA regime.
Deduction allowed.
Net tax: (Rs 8 cr - Rs 50 L) × 22% × 1.1 × 1.04 = Rs 1.89 cr.
Result. Section 80M preserved under s. 115BAA.
PRACTITIONER PLANNING NOTES
■ Annual regime-choice modelling — old vs new regime tax computation.
■ Section 115BAC default (FA 2023) — opt-out via Form 10-IEA for business income; once-and-for-all for some categories.
■ Section 115BAA — once-and-for-all opt-in for corporates; forfeits MAT applicability.
■ Section 115BAB — new manufacturing (incorporated 1-Oct-2019+, commenced 31-Mar-2024+).
■ Section 115JB — MAT 15% on book profits; MAT credit u/s 115JAA 15-year carry-forward.
■ Section 115BBE — 60% + 25% surcharge ~ 78% effective on cash credits.
■ Concessional regime forfeitures — Chapter VI-A (except 80JJAA / 80CCD(2)), losses brought forward, additional depreciation.
■ Form 10-IC / 10-ID timing — within return-filing due date u/s 139(1) — strict.
■ Section 87A rebate — varies between regimes (Rs 12,500 vs Rs 25,000 for new regime FY 2023-24 onwards).
■ Section 80CCD(2) employer NPS — available even in new regime.
■ Section 80JJAA new-employment incentive — available even in 115BAA/BAB.
■ Standard deduction Rs 50K / Rs 75K (new regime FA 2024 onwards) — available in new regime.
■ Surcharge structure — capped at 25% under new regime (FA 2023) vs 37% under old.
■ MAT-credit utilisation strategy — interplay with regime-choice.
■ Documentation 7 years — supporting opt-in / opt-out elections and computation basis.
LITIGATION DEFENCE
■ Vatika Township — prospective amendment for new regime substantive provisions.
■ Mathuram Agrawal — strict construction of charging / concessional provisions.
■ K.P. Varghese — object-and-purpose interpretation.
■ Calcutta Discount — Article 226 writ where statutory remedy not efficacious.
■ Hindustan Coca-Cola anchor — no double counting / recovery.
■ Section 273B reasonable-cause defence for procedural lapses (regime opt-in form delays).
■ Reliance Petroproducts — bona-fide claim disclosed in return.
■ Dilip N. Shroff — penalty discretion.
■ Strict-construction defence — concessional regime conditions are mandatory; substantial compliance debate.
■ Constitutional grounds — Article 14 / 19 / 265 in extreme arbitrariness cases.
■ Form 10-IC / 10-ID late filing — Hexaware-type bona-fide defence; ITAT cases (Trishna Industries / Ekta Diamonds).
■ MAT credit denial — Apollo Tyres SC anchor for MAT computation principles.
■ Section 115JB book-profit additions — Tata Sky / Bombay HC framework on net profit starting point.
■ Section 234B / 234C interest on retrospective regime-switching — defence grounds.
■ Bona-fide TDS deduction — reasonable-cause defence under s. 273B for non-corporate AMT cases.
■ Constitutional non-discrimination — DTAA Article 24 in NR-related disputes.
STEP-BY-STEP PROCEDURE — 15 STEPS
Step 1. Eligibility assessment
Confirm assessee qualifies for the regime under section's conditions.
Step 2. Tax modelling — old vs new
Comparative computation under both regimes for the relevant FY.
Step 3. Carve-outs and forfeitures check
Identify Chapter VI-A / loss / MAT forfeitures under concessional regime.
Step 4. Once-for-all vs annual choice
Determine whether regime choice is annual (s. 115BAC) or permanent (s. 115BAA/BAB).
Step 5. Form 10-IEA / 10-IC / 10-ID filing
Within return-filing due date u/s 139(1); EVC / DSC verified.
Step 6. Advance tax instalment computation
Adjust advance tax per chosen regime; s. 234C interest awareness.
Step 7. MAT / AMT computation
Section 115JB MAT for corporates; s. 115JC AMT for non-corporates.
Step 8. Section 87A rebate optimisation
Apply regime-specific rebate (FA 2023+ for s. 115BAC).
Step 9. Surcharge cap awareness
New regime surcharge capped at 25% (s. 115BAC); MMR for AOP/BOI.
Step 10. TDS reconciliation per regime
Adjust salary TDS per new-regime declaration (Form 12BB / 16).
Step 11. Return filing per regime
ITR with regime-specific schedules and computation.
Step 12. MAT credit claim u/s 115JAA
If applicable — claim credit and carry-forward for 15 years.
Step 13. Section 80JJAA / 80CCD(2)
Available even under concessional regime.
Step 14. Documentation
Preserve Form 10-IEA / 10-IC / 10-ID + tax-comparison workings 7 years.
Step 15. Regime-switch monitoring
Annual review for s. 115BAC; track once-for-all status for s. 115BAA / BAB.
PRACTITIONER CHECKLIST — 19 ITEMS
PRACTITIONER CHECKLIST
☐ Eligibility under section's conditions confirmed.
☐ Comparative tax modelling — old vs new regime — workings preserved.
☐ Form 10-IEA / 10-IC / 10-ID filed within due date u/s 139(1).
☐ Carve-out / forfeiture impact computed (Chapter VI-A / losses / MAT).
☐ Advance tax instalments per chosen regime.
☐ Section 234B / 234C interest worked out.
☐ MAT / AMT computation if applicable.
☐ Section 87A rebate per regime applied.
☐ Surcharge cap (25%) applied for s. 115BAC where applicable.
☐ Salary TDS adjustment per regime declaration.
☐ ITR with regime-specific schedules filed.
☐ MAT credit u/s 115JAA tracked.
☐ Section 80JJAA / 80CCD(2) availability checked.
☐ Standard deduction Rs 50K / Rs 75K applied.
☐ Section 115JB Form 29B (MAT certificate) — for corporates.
☐ Regime-switch register maintained (especially s. 115BAC annual).
☐ Schedule II FA Act rates verified.
☐ DTAA non-discrimination considerations (NR cases).
☐ Documentation 7 years — full regime-choice file preserved.
CROSS-REFERENCES (28+)
CROSS-REFERENCES
▸ Section 115BAOriginal concessional regime (older / narrower).
▸ Section 115BABNew manufacturing 15% — parallel.
▸ Section 115BACIndividual / HUF parallel.
▸ Section 115JBMAT — inapplicable to s. 115BAA companies.
▸ Section 80JJAANew employment — available.
▸ Section 80MInter-company dividend — available.
▸ Section 10AASEZ — forfeited.
▸ Section 32(1)(iia)Additional depreciation — forfeited.
▸ Section 32AD / 33AB / 33ABA / 35Specified deductions — forfeited.
▸ Section 35AD / 35CCCSpecified business — forfeited.
▸ Section 72 / 72ALoss set-off attributable — forfeited.
▸ Form 10-ICOpt-in form.
▸ Section 139(1)Due date for Form 10-IC.
▸ Section 234A / 234B / 234CInterest on advance tax.
▸ Section 115JAAMAT credit — frozen on s. 115BAA opt-in.
▸ Section 115BBECash-credits 60% — independent.
▸ Section 270A / 271AAB / 271AACPenalty framework.
▸ Section 144BFaceless overlay.
▸ Section 246A / 253Appeal routes.
▸ CBDT Circular 6/2022Form 10-IC condonation.
▸ Trishna Industries / Ekta Diamonds (ITAT)Substantial-compliance ratio.
▸ Vatika Township (SC)Prospective amendment.
▸ Mathuram Agrawal (SC)Strict construction.
▸ Apollo Tyres (SC)MAT computation principles.
▸ DTAA Article 24Non-discrimination.
▸ Article 14 / 265 — ConstitutionConstitutional safeguards.
▸ Section 536 — ITA 2025Saves opt-in elections.