Mr. Brajesh has set up a unit in SEZ in May, 2017. The total turnover, export turnover and net profit for the year ended 31.3.2025 were 120 lakhs,…

Computation of total income of Mr. Brajesh for the A.Y. 2025-26 under default tax regime under section 115BAC Particulars Amount (₹) I. Profits and gains of business and profession Profit from SEZ unit Net profit from SEZ unit 7,50,000 Income from warehousing facility for storage of food grain Net profit as per profit and loss account 8,50,000 Less: Income credited to profit and loss account but taxable under the head 'Income from Other Sources' Interest on savings bank A/c with post office 15,000 Interest on fixed deposit with SBI 20,000 Dividend from Indian companies (Gross) 32,000 7,83,000 Add: Payments not allowable as deduction Advance income-tax paid disallowed u/s 40(a)(ii) 1,00,000 Personal drawings disallowed u/s 37 70,000 Purchase of building 10,00,000 19,53,000 Less: Depreciation on building [₹ 10,00,000 × 10%] 1,00,000 18,53,000 Income from firm M/s Neelkamal Associates Interest on capital@13% p.a. on 15 lakhs, restricted to 12%, which is the maximum deduction allowable in the hands of the firm 1,80,000 Salary to Mr. Brajesh as a working partner, which is allowable as deduction in the hands of firm (₹ 20,000 x 12) 2,40,000 4,20,000 II. Income from Other Sources Interest on savings bank A/c with post office 15,000 Less: Exempt under section 10(15) 3,500 11,500 Interest on fixed deposit with SBI 20,000 Dividend from Indian companies (Gross) 32,000 63,500 Gross Total Income/ Total Income 30,86,500 [No deduction under section 80C, 80TTA and 10AA would be allowable] Computation of tax payable under default tax regime for A.Y. 2025-26 Particulars Particulars ₹ Tax on total income of 30,86,500 On first - 3,00,000 Nil 3,00,001 - 7,00,000 [@5% of 4lakhs] 20,000 7,00,001 - 10,00,000 [@10% of 3lakhs] 30,000 10,00,001 - 12,00,000 [@15% of 2lakhs] 30,000 12,00,001 -15,00,000 [@20% of 3lakhs] 60,000 15,00,001 - 30,86,500 [@30% of 15,86,500] 4,75,950 6,15,950 Add: Health and Education cess @4% 24,638 6,40,588 Less: Advance income-tax paid 1,00,000 Tax payable 5,40,588 Tax Payable (Rounded off) 5,40,590 Computation of total income of Mr. Brajesh for the A.Y. 2025-26 under normal provisions of the Act Particulars Amount (in ₹) Gross Total Income as per section 115BAC 30,86,500 Less: Deduction under section 10AA [₹ 7,50,000 x 40,00,000/1,20,00,000 x 50%, being eighth year of operation] 1,25,000 29,61,500 Less: Deduction under section 35AD 10,00,000 Add: Depreciation on building 1,00,000 9,00,000 20,61,500 Less: Deduction under Chapter VI-A Deduction under section 80C Life insurance premium [maximum 10% of sum assured] 50,000 Deduction under section 80TTA Interest on saving bank account with post office, restricted to 10,000 60,000 Total Income 20,01,500 Computation of tax payable by Mr. Brajesh for A.Y. 2025-26 under the regular provisions of the Act Particulars Particulars ₹ Tax on total income of 20,01,500 Upto 2,50,000 Nil 2,50,001 - 5,00,000 [@5% of 2.50 lakhs] 12,500 5,00,001 - 10,00,000 [@20% of 5lakhs] 1,00,000 10,00,001 -20,01,500 [@30% of 10,01,500] 3,00,450 4,12,950 Add: Health and education cess@4% 16,518 Total tax liability 4,29,468 Less: Advance income-tax paid 1,00,000 Tax payable 3,29,468 Tax payable (rounded off) 3,29,470 Computation of adjusted total income and AMT of Mr. Brajesh for A.Y. 2025-26 Particulars Particulars ₹ Total Income (computed above as per regular provisions of income tax) 20,01,500 Add: Deduction under section 10AA 1,25,000 Add: Deduction under section 35AD 10,00,000 Less: Depreciation on building (1,00,000) 10,25,000 Adjusted Total Income 30,26,500 Alternative Minimum [email protected]% 5,59,903 Add: Health and education cess@4% 22,396 Total tax liability 5,82,299 Less: Advance income-tax paid 1,00,000 Tax payable 4,82,299 Tax payable (rounded off) 4,82,300 Since the regular income-tax payable is less than the alternate minimum tax payable, the adjusted total income shall be deemed to be the total income and tax is leviable @18.5% thereof plus cess@4%. Therefore, tax liability as per section 115JC is 4,82,300.