TVS Shriram Growth Fund, CHENNAI V. ITO Non Corporate Ward 3(5), CHENNAI

CO 1/CHNY/2018

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3543 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 25 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 03-01-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SAILENDRA MAMIDI

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: CHENNAI . , ! , $ % BEFORE SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER ./ ITA NOS.2443 & 2444/CHNY/2017 $! ! /ASSESSMENT YEARS: 2009-10 & 2010-11 THE INCOME TAX OFFICER, NON-CORPORATE WARD-3(5), 121, M.G.ROAD, NUNGAMBAKKAM, CHENNAI-600 034. VS. M/S.TVS SHRIRAM GROWTH- FUND, 249A, AMBUJAMMAL STREET, OFF: TTK ROAD, NEAR ALWARPET POST OFFICE, ALWARPET, CHENNAI-600 018 [PAN: AABTT 5582 H ] ( ' /APPELLANT) ( ()' /RESPONDENT) CROSS OBJECTION NOS.1 & 2 /CHNY/2018 $! ! /ASSESSMENT YEARS: 2009-10 & 2010-11 M/S.TVS SHRIRAM GROWTH FUND, 249A, AMBUJAMMAL STREET, OFF: TTK ROAD, NEAR ALWARPET POST OFFICE, ALWARPET, CHENNAI-600 018 VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD-3(5), 121, M.G.ROAD, NUNGAMBAKKAM, CHENNAI-600 034. [PAN: AABTT 5582 H ] ( ' /APPELLANT) ( ()' /RESPONDENT) DEPARTMENT BY : MR.SAILENDRA MAMIDI, CIT ASSESSEE BY : MR.SAROJ KUMAR PARIDA, ADV. + /DATE OF HEARING : 28.02.2018 + /DATE OF PRONOUNCEMENT : 28.02.2018 / O R D E R PER BENCH : ITA NO.2443/CHNY/2017 IS AN APPEAL FILED BY THE RE VENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEAL S)-4, CHENNAI, IN ITA NOS.2443 & 2444/CHNY/2017 CO NOS.1 & 2/CHNY/2018 :- 2 -: ITA NO.66/2016-17/AY 2009-10/CIT(A)-4 DATED 11.07.2 017 FOR THE AY 2009-10 AGAINST THE CANCELLATION OF PENALTY LEVIED U/S.271(1)(C) AND ITA NO.2444/CHNY/2017 IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-4, CHEN NAI, IN ITA NO.67/2016-17/AY 2010-11/CIT(A)-4 DATED 11.07.2017 FOR THE AY 2010- 11 AGAINST THE CANCELLATION OF PENALTY LEVIED U/S.2 71(1)(C) AND CO NO.1/CHNY/2018 FILED BY THE ASSESSEE IN ITA NO.2443 /CHNY/2017 FOR THE AY 2009-10 & CO NO.2/CHNY/2018 FILED BY THE ASSESS EE IN ITA NO.2444/CHNY/2017 FOR THE AY 2010-11. 2. SHRI SAILENDRA MAMIDI, CIT., REPRESENTED ON BEHA LF OF THE REVENUE AND SHRI SAROJ KUMAR PARIDA, ADV., REPRESENTED ON B EHALF OF THE ASSESSEE. 3. AS BOTH THE APPEALS ARE RELATED TO THE SAME ASSE SSEE AND INVOLVED THE SAME ISSUES, THE SAME ALONG WITH CROSS-OBJECTIO NS ARE DISPOSED OFF BY THIS COMMON ORDER. 4. IT WAS SUBMITTED BY THE LD.AR AT THE TIME OF HEA RING THAT THE QUANTUM APPEALS IN THE CASE OF THE ASSESSEE FOR THE AYS 2009-10 & 2010- 11 HAD BEEN DISPOSED OFF BY THE CO-ORDINATE BENCH O F THIS TRIBUNAL IN ITA NOS.1345 & 1401/MDS/2016 DATED 07.06.2017, WHEREIN, IN PARA NO.6.7 AT PAGE NOS.28 & 29 OF THE ORDER, THE CO-ORDINATE BENC H OF THIS TRIBUNAL HAS HELD AS FOLLOWS: ITA NOS.2443 & 2444/CHNY/2017 CO NOS.1 & 2/CHNY/2018 :- 3 -: 6.7 IN THE INSTANT CASE, THE ASSESSEE HAS CREATED A TR UST WHICH WAS REGISTERED AND THE BENEFICIARIES HAVE BEEN IDENTIFIED BY THE CONTRIBUT ION AGREEMENT(PPM) AND THEIR SHARES ARE ALSO ASCERTAINABLE WITH RESPECT TO CONTRIBUTIONS AN D THE UNITS. THE HONBLE HIGH COURT CONSIDERED THE ISSUE REGARDING IDENTIFICATION OF BE NEFICIARIES AT THE TIME OF FORMATION OF THE TRUST AND EXPRESSED VIEW THAT EVEN AFTER EXECUTION OF THE TRUST DEED IF THE BENEFICIARIES ARE IDENTIFIABLE AND THEIR SHARES ARE ASCERTAINABLE IT IS SUFFICIENT COMPLIANCE TO HOLD THE TRUST AS DETERMINATE TRUST. IN THE ASSESSEES CASE THE BENEF ICIARIES ARE IDENTIFIABLE WITH PPM AND THEIR SHARES ARE ASCERTAINABLE AS DISCUSSED EARLIER IN THIS ORDER. THE FACTS OF THE CASE ARE SIMILAR TO THAT OF INDIA ADVANTAGE FUND SUPRA AND THE DECISION RENDERED BY THE HONBLE ITAT BANGALORE SQUARELY APPLIES IN THIS CASE. RESP ECTFULLY FOLLOWING THE DECISION OF THE CO- ORDINATE BENCH OF BANGALORE AND HONBLE KARNATAKA HIGH COURT SUPRA WE HOLD THAT THE ASSESSEES TRUST IS A DETERMINATE TRUST AND THE APP EAL OF THE ASSESSEE IS ON THIS ISSUE IS ALLOWED. 5. IT WAS A SUBMISSION THAT AS THE ISSUE HAS BEEN H ELD IN FAVOUR OF THE ASSESSEE AND AS THE LD.CIT(A) DELETED THE PENALTY O N ACCOUNT OF THE FINDINGS OF THE TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE AYS 2009-10 & 2010-11, THE SAME WAS LIABLE TO BE UPHELD. 6. IN REPLY, THE LD.DR VEHEMENTLY SUPPORTED THE ORD ER OF THE AO. IT WAS A SUBMISSION THAT THE ISSUE OF THE TAXABILITY O F THE CORRECT INTEREST INCOME, THE ISSUE HAD BEEN RESTORED TO THE AO BY TH E TRIBUNAL. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. 8. AS IT IS NOTICED THAT THE PENALTY HAS BEEN LEVIE D ON THE ASSESSEE ON ACCOUNT OF THE CONCLUSION OF THE AO THAT THE TRUST DEED DOES NOT HAVE THE NAME OF THE INVESTORS AND DOES NOT SPECIFIED THE BE NEFICIAL INTEREST INCOME, SEC.164 WOULD COME INTO PLAY. FURTHER, THE AO HAS LEVIED THE PENALTY ON ACCOUNT OF THE CONSEQUENTIAL TAXATION OF THE INTEREST INCOME FROM THE FIXED DEPOSITS. A PERUSAL OF THE ORDER OF THE TRIBUNAL CLEARLY SHOWS THAT IN THE CASE OF THE ASSESSEE, THE TRIBUNA L HAS GIVEN A ITA NOS.2443 & 2444/CHNY/2017 CO NOS.1 & 2/CHNY/2018 :- 4 -: CATEGORICAL FINDING THAT THE ASSESSEE IS A DETERMIN ATE TRUST. FURTHER, THE TRIBUNAL HAS RESTORED THE ISSUE IN RESPECT OF THE C ORRECT INCOME THAT IS LIABLE TO BE TAXED TO THE FILE OF THE AO. THIS BEI NG SO, IT IS NOTICED THAT THE ISSUES ON WHICH THE PENALTY HAS BEEN LEVIED, NO MOR E SURVIVE. CONSEQUENTLY, WE FIND NO ERROR IN THE ORDER OF THE LD.CIT(A) WHICH CALLS FOR ANY INTERFERENCE. CONSEQUENTLY, THE APPEALS FIL ED BY THE REVENUE ARE DISMISSED. 9. IT WAS SUBMITTED BY THE LD.AR THAT THE CROSS-OBJ ECTIONS FILED BY THE ASSESSEE ARE IN SUPPORT OF THE ORDER OF THE LD.CIT( A). AS WE HAVE ALREADY UPHELD THE ORDER OF THE LD.CIT(A), THE CROSS-OBJECT IONS FILED BY THE ASSESSEE NO MORE SURVIVE AND CONSEQUENTLY, THE SAME ARE DISPOSED OFF AS INFRUCTUOUS. 10. IN THE RESULT, THE APPEALS FILED BY THE REVENUE IN ITA NOS.2443 & 2444/CHNY/2017 AND CROSS-OBJECTIONS FILED BY THE AS SESSEE IN CO NOS.1 & 2/CHNY/2018 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FEBRUARY 28, 2018, AT CHENNAI. SD/- SD/- ( . ) ( ABRAHAM P.GEORGE ) /ACCOUNTANT MEMBER ( ! ) (GEORGE MATHAN) $ /JUDICIAL MEMBER ITA NOS.2443 & 2444/CHNY/2017 CO NOS.1 & 2/CHNY/2018 :- 5 -: /CHENNAI, 0 /DATED: FEBRUARY 28, 2018. TLN + ($12 32 /COPY TO: 1. ' /APPELLANT 4. 4 /CIT 2. ()' /RESPONDENT 5. 2 ($$ /DR 3. 4 ( ) /CIT(A) 6. ! /GF