Assam Building and Other Construction Workers Welfare Board V. The Union of India and Central Board of Direct Taxes and Principal Chief Commissioner of Income Tax (NER) and Principal Commissioner of Income Tax Guwahati-I and Commissioner of Income Tax TDS and Income Tax Officer ITO W 3 (1) Guwahati and Income Tax Officer ITO 1(5) Guwahati and Income Tax Officer-Ward 1(2) Guwahati and Additional/Joint/Deputy/Assistant Commissioner of Income Tax/National Faceless Assessment Centre

WP(C)/3805/2021

AI Insights

The case involves the Assam Building and Other Construction Workers Welfare Board, which sought an exemption under Section 10(46) of the Income Tax Act, 1961, for certain incomes from cess and bank deposit interests. The exemption was claimed to avoid these incomes being included in the total income for tax purposes. The application for exemption was initially not considered, leading to the filing of this writ petition. The court examined the procedural compliance of the petitioner with the requirements set by the Central Board of Direct Taxes (CBDT) for such applications. It was found that the petitioner had not fully complied with the procedural requirement of sending a copy of the application to the Under Secretary (ITA-1), CBDT, which led to the decision to allow a fresh application to be filed.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 694272 (HC-ASSAM NAGALAND MIZORAM AND ARUNACHAL PRADESH)
• Appeal Type: Others
• Pronouncement Date: 20-08-2021
• Assessment Year: misc
• Laws Referred To: Building and Other Constructions Workers (Regulation of Employment and Conditions of Service) Act, 1996, Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: S SARMA; K GOGOI
• Assessee Lawyers: M HAZARIKA
• Keywords: Income tax exemption; Section 10(46); Building and Other Construction Workers Welfare Board; Application Procedure
• Section: 10(46)

Judgement Text

"Page No.# 1/7 GAHC010122642021 THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH) Case No. : WP(C)/3805/2021 ASSAM BUILDING AND OTHER CONSTRUCTION WORKERS WELFARE BOARD REP. BY ITS MEMBER SECRETARY SRI AMITABH RAJKHOWA, AGED ABOUT 59 YEARS, HAVING ITS OFFICE T GOPINATH NAGAR, GUWAHATI- 781016. VERSUS THE UNION OF INDIA AND 8 ORS THROUGH SECRETARY TO GOVT. OF INDIA, MINISTRY OF FINANCE, DEPTT. OF REVENUE, NORTH BLOCK, NEW DELHI- 110001. 2:CENTRAL BOARD OF DIRECT TAXES THROUGH ITS CHAIRMAN DEPARTMENT OF REVENUE MINISTRY OF FINANCE GOVT. OF INDIA NORTH BLOCK NEW DELHI- 110001. 3:PRINCIPAL CHIEF COMMISSIONER OF INCOME TAX (NER) INCOME TAX DEPTT. MINISTRY OF FINANCE GOI 1ST FLOOR AAYAKAR BHAWAN CHRISTIANBASTI G.S. ROAD GUWAHATI- 781005. 4:PRINCIPAL COMMISSIONER OF INCOME TAX GUWAHATI-I INCOME TAX DEPTT. MINISTRY OF FINANCE GOI AAYKAR BHAWAN Page No.# 2/7 G.S. ROAD CHRISTIAN BASTI GUWAHATI- 781005. 5:COMMISSIONER OF INCOME TAX TDS INCOME TAX DEPTT. MINISTRY OF FINANCE GOI AAYAKAR BHAWAN CHRISTIANBASTI G.S. ROAD GUWAHATI- 781005. 6:THE INCOME TAX OFFICER ITO W 3 (1) GUWAHATI OFFICE OF THE INCOME TAX OFFICER INCOME TAX DEPTT. MINISTRY OF FINANCE GOI AAYAKAR BHAWAN CHRISTIANBASTI G.S. ROAD GUWAHATI- 781005. 7:THE INCOME TAX OFFICER ITO 1(5) GUWAHATI INCOME TAX DEPTT. MINISTRY OF FINANCE GOI AAYAKAR BHAWAN CHRISTIANBASTI G.S. ROAD GUWAHATI- 781005. 8:THE INCOME TAX OFFICER-WARD 1(2) GUWAHATI AAYKAR BHAWAN G.S. ROAD CHRISTIANBASTI GUWAHATI-781005. 9:THE ADDL./JT./DEPUTY/ASSISTANT COMMISSIONER OF INCOME TAX/INCOME TAX OFFICER NATIONAL FACELESS ASSESSMENT CENTRE (FORMERLY NATIONAL E-ASSESSMENT CENTRE) INCOME TAX DEPTT. Page No.# 3/7 MINISTRY OF FINANCE GOI NEW DELHI Advocate for the Petitioner : MS M HAZARIKA Advocate for the Respondent : ASSTT.S.G.I. BEFORE HONOURABLE MR. JUSTICE ACHINTYA MALLA BUJOR BARUA Date : 20-08-2021 JUDGMENT & ORDER (ORAL) Heard Ms. M Hazarika, learned senior counsel for the petitioner, Mr. S Sarma, learned counsel for the respondents in the Income Tax Department as well as Mr. K Gogoi, learned counsel for the respondents No. 1 and 2 being the authorities in the Ministry of Finance, Government of India. 2. The petitioner Assam Building and other Construction Workers Welfare Board is a body corporate created under the Building and other Constructions Workers (Regulation of Employment and Conditions of Service) Act, 1996. Under Section 10(46) of the Income Tax Act, 1961, the petitioner claims the benefit of certain income of theirs coming from the cess and the interest from the bank deposits to be not included to form the part of their total income. Section 10(46) of the Income Tax Act, 1961 refers to any specific income arising to a body or authority or Board or Trust or Commission (by whatever name called) which has been established or constituted by or under a Central, State or Provincial Act, or constituted by the Central Government or a State Government, with the object of regulating or administering any activity for the benefit of the general public; is not engaged in any commercial activity; and is notified by the Central Government in the Official Gazette for the purpose of this clause. The provision of Section 10(46) of the Income Tax Act, 1961 is extracted as below:- “(46) any specific income arising to a body or authority or Board or Trust or Page No.# 4/7 Commission (by whatever name called) which- (a) has been established or constituted by or under the Central, State or Provincial Act, or constituted by the Central Government or a State Government, with the object of regulating or administering any activity for the benefit of the general public; (b) is not engaged in any commercial activity; (c)and is notified by the Central Government in the Official Gazette for the purpose of this clause.” 3. In furtherance of the claim for that part of the income to be exempted from the total income u/s 10(46) of the Income Tax Act, 1961, the petitioner had made an application claiming exemption u/s 10(46) of the Income Tax Act, 1961. The said application was forwarded to the Principal Chief Commissioner of Income Tax (North-eastern Region) at Guwahati as per the communication dated 20.01.2020 of the Labour Commissioner, Assam cum Principle Secretary, Assam Building and other Constructions Workers Welfare Board. 4. Without going into any other aspects as regards any tax proceedings that may have been initiated against the petitioner in the meantime, we take note of the specific grievance that the aforesaid application seeking an exemption from payment of income tax u/s 10(46) of the Income Tax Act, 1961 has not been given a due consideration. 5. Considering the said limited grievance, we propose to give a final consideration to this writ petition. 6. Mr. S Sarma, learned counsel for the respondents in the Income Tax Department has produced a communication dated 03.02.2020 from the Deputy Commissioner of Income Tax (Tech) on behalf of the Principal Chief Commissioner of Income Tax, Guwahati addressed to the Labour Commissioner, Page No.# 5/7 Assam inviting attention to the letter No.196/6/2013-ITA.1 dated 24.06.2013 of the Central Board of Direct Taxes (in short CBDT), New Delhi. By referring to the said letter of the CBDT dated 24.06.2013, the Principal Chief Commissioner of Income Tax, North-eastern Region at Guwahati put-forth certain important points that has been extracted from the letter of the CBDT. We have also gone through the letter dated 24.06.2013 of the CBDT of the Government of India in the Ministry of Finance (Department of Revenue). The said letter provides for standardising the manner for filing application u/s 10(46) of the Income Tax Act, 1961. Clause-2 of the said letter of 24.06.2013 is extracted below:- “2. At present, there is no uniformity in the manner in which applications under Sec. 10(46) are being filed by applicants. In order to standardize the manner of filing application u/s 10(46) and to avoid procedural delay in processing the same applicants are advised to file the applications along-with requisite enclosures to the Commissioner of Income-tax/Director of Income tax under whose jurisdiction their cases fall. The applicants are further advised to adopt the Format laid down in para 3 below while submitting the applications u/s 10(46) of the IT Act. The applicant shall also send a copy of the said application along with all its enclosures to the Under Secretary (ITA-1), Central Board of Direct Taxes, accompanied by the acknowledgement receipt forwards evidence of having furnished the application in the office or jurisdictional CIT/DIT.” 7. A reading of clause 2 of the letter dated 24.06.2013 makes it discernible that in order to avail the benefit of section 10(46) of the Income Tax Act, 1961, the applicants are required to file their application along with the requisite enclosures to the Commissioner of Income Tax/Director of Income Tax under whose jurisdiction the respective cases may fall. In doing so, the applicants are required to make their application in the format provided in clause 3 of the said letter. It further provided that along with the said application in the proper Page No.# 6/7 format along with enclosures made to the jurisdictional Commissioner of Income Tax/Director of Income Tax, a copy of such applications be also sent to the Under Secretary (ITA-1) of the Central Board of Direct Tax. 8. Mr. S Sarma, learned counsel seeks to take a stand that the petitioner had not followed the appropriate procedure as indicated above and therefore it is a possibility that because of such reason their application had not been attended to. 9. Ms. M Hazarika, learned senior counsel for the petitioner on the other hand refers to Annexure-6 communication dated 29.01.2020 from the Member Secretary, Assam Building and Other Constructions Workers Welfare Board made to the Principal Chief Commissioner of Income Tax, NER by which a claim for an exemption u/s 10(46) of the Income Tax Act, 1961 had been made. Further reference is also made to the application dated 14.05.2020 for exemption u/s 10(46) of the Income Tax Act, 1961 made by the petitioner in the appropriate format, which is available at page 46 of the writ petition. The application at page 46 prima-facie appears to be in conformity with the required format provided in clause 3 of the letter dated 24.06.2013 of the CBDT. 10. Be that as it may, as the petitioner had apparently made an application in the appropriate format on 14.05.2020 to the Principal Commissioner of Income Tax, NER at Guwahati, it prima-facie does not appear to us that the petitioner had not made the application in the required procedure as provided in the letter dated 24.06.2013 of the CBDT. But, however, Mr. S Sarma, learned counsel points out that a copy of such application is also required to be forwarded to the Under Secretary (ITA-1) of the CBDT. 11. Without going into any such question, we require the petitioner to file a Page No.# 7/7 fresh application claiming exemption u/s 10(46) of the Income Tax Act, 1961 in the given format provided in clause 3 of the letter dated 24.06.2013 of the CBDT and the said application be sent to the Principal Commissioner of Income Tax, NER, Guwahati. A copy thereof be also given to the Under Secretary (ITA- 1), CBDT. 12. The application be made within a period of 15(fifteen) days from today. After the application is received by the Principal Commissioner of Income Tax, NER, Guwahati with a copy thereof to the Under Secretary (ITA-1), CBDT, the Principal Commissioner of Income Tax may do the needful for passing the appropriate relevant order in such application as per law. 13. The requirement of passing the order be done within a period of one month from the date of receipt of such application. If the Principal Commissioner of Income Tax, NER, Guwahati is of the view that he is not the appropriate authority to pass the order, the Principal Commissioner of Income Tax, NER, Guwahati may place such application before the appropriate authority who according to him would be competent to pass the necessary order and such authority shall do the needful within the aforesaid period. 14. Till a decision is taken in the application u/s 10(46) of the Income Tax Act, 1961 of the petitioner, no coercive action be taken. Such interim protection would not hold good any further, if the application is not made within the aforesaid period of 15(fifteen) days. The writ petition is disposed of in the above terms. JUDGE Comparing Assistant "