Surcharge on pvt discretionary trust

This query is : Resolved

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A private discretionary trust taxed at Maximum Marginal Rate (MMR) is not automatically liable for highest surcharge. If 143(1) wrongly applies 10-15% or 37% surcharge on low income, it is a computation error. Such mistakes can be challenged through rectification or appeal; no penalty arises if income is unchanged.

Kunjan

Kunjan (Querist)
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14 February 2026 143(1) levied strange 10 or 15% surcharge on pvt disc. trust having just 7 lakh interest income,

i thikn its taxed at MMR, thats y?

not sure,

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)
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14 February 2026 Yes, private discretionary trust is taxed at MMR (30%).
But surcharge should not apply at ₹7 lakh income.
If 10% or 15% surcharge is applied, it is likely a computation or status error and can be corrected via rectification.

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Kunjan

Kunjan (Querist)
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22 March 2026 yes sir going in appeal (rectification failed).
, wrongly 143(1) levied 37% surcharge (for aop it was 15%, but pvt disc trust is not aop, its boi).
mmr does not mean surcharge also should be at max rate.

Kunjan

Kunjan (Querist)
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04 April 2026 will penalty also follow ? 143(1) levied cess (income remains same).
my view - no penalty as income remains same. (Chapter XXI of the "Act" lists down the various kinds of penalties imposable,)

Kunjan

Kunjan (Querist)
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08 April 2026 resolved. no penalty, but department implies MMR means surcharge also at highest rate of 37%

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