Tamilnadu Golf Federation, CHENNAI V. ITO (Exemptions), Chettur

CO 157/CHNY/2016

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 2932 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 23 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 13-04-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 14-03-2017
• Assessment Year: 2012-2013
• Appeal Filed On: 21-10-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V RA VICHANDRAN
• Assessee Lawyers: SUPRIYO PAL
• Keywords: Capital asset; Depreciation; Capital expenditure
• Section: 32; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , !.. # $%, ' () BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NOS.2510, 2511 & 2512/MDS/2016 & C.O. NOS.155, 156 & 157/MDS/2016 (IN ITA NOS.2510, 2511 & 2512/MDS/2016) + ,+ / ASSESSMENT YEARS : 2010-11, 2011-12 & 2012-13 THE INCOME TAX OFFICER (EXEMPTIONS), WARD-3, CHENNAI - 600 034. V. M/S TAMIL NADU GOLF FEDERATION, NO.334, ANNA SALAI, NANDANAM, CHENNAI - 600 015. PAN : AAATT 2341 E (.// APPELLANT) ( RESPONDENT & CROSS-OBJECTOR) ./ 0 1 / APPELLANT BY : SHRI SUPRIYO PAL, JCIT 23./ 0 1 / RESPONDENT BY : SHRI V. RAVICHANDRAN, CA # 0 4' / DATE OF HEARING : 14.03.2017 56, 0 4' / DATE OF PRONOUNCEMENT : 13.04.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: ALL THE APPEALS OF THE REVENUE ARE DIRECTED AGAI NST THE COMMON ORDER PASSED BY THE COMMISSIONER OF INCOME T AX (APPEALS)-17, CHENNAI, DATED 30.03.2016, FOR THE AS SESSMENT YEARS 2010-11 TO 2012-13. THE ASSESSEE HAS ALSO FILED CR OSS-OBJECTIONS AGAINST THE VERY SAME ORDER OF THE CIT(APPEALS). T HEREFORE, WE 2 I.T.A. NOS.2510 TO 2512/MDS/16 C.O. NOS.155 TO 157/MDS/16 HEARD BOTH THE APPEALS AND CROSS-OBJECTIONS TOGETHE R AND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2. THE ONLY ISSUE ARISES IN ALL THE APPEALS OF THE REVENUE IS WITH REGARD TO CLAIM OF EXEMPTION UNDER SECTION 11 OF THE INCOME- TAX ACT, 1961 (IN SHORT 'THE ACT'). THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSESSEE FOR EXEMPTION UNDER SECTI ON11 OF THE ACT ON THE GROUND THAT THE ASSESSEE HAS COLLECTED SUBSC RIPTION FEE ANNUALLY AND ALSO COLLECTED LIFE MEMBERSHIP FEE. T HE ASSESSING OFFICER ALSO FOUND THAT THE ACTIVITIES OF THE ASSES SEE ARE COMMERCIAL IN NATURE, HENCE, PROVISO TO SECTION 2(15) OF THE A CT WOULD COME INTO OPERATION. THIS ISSUE WAS EXAMINED BY THIS TR IBUNAL IN THE ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEAR 2009-10 IN I.T.A. NO.712/MDS/2014 DATED 14.01.2016. IN FACT, THE CIT (APPEALS), AFTER REPRODUCING THE ORDER OF THIS TRIBUNAL FOR THE ASSE SSMENT YEAR 2009- 10, ALLOWED THE CLAIM OF THE ASSESSEE UNDER SECTION 11 OF THE ACT. THIS TRIBUNAL HAS TAKEN A SIMILAR VIEW IN THE CASE OF TAMIL NADU CRICKET ASSOCIATION V. DIT(E) 42 ITR(TRIB) 546. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTE RFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SA ME IS CONFIRMED. 3 I.T.A. NOS.2510 TO 2512/MDS/16 C.O. NOS.155 TO 157/MDS/16 3. THE CROSS-OBJECTIONS OF THE ASSESSEE IS ONLY IN RESPECT OF DEPRECIATION ON THE ASSETS AND THE COST OF WHICH WA S ALLOWED AS APPLICATION OF INCOME UNDER SECTION 11 OF THE ACT. IN FACT, THIS WAS ALSO ELABORATELY EXAMINED BY THIS TRIBUNAL IN THE C ASE OF TAMIL NADU CRICKET ASSOCIATION (SUPRA) AND OBSERVED AT PA RA 12 OF ITS ORDER AS FOLLOWS:- 12. APART FROM THAT, WHEN THE ASSESSEE CLAIMS THE CO ST OF THE CAPITAL EXPENDITURE AS EXEMPTION UNDER SECTIO N 11 OF THE ACT, THEN THE COST OF THE CAPITAL ASSET BECO MES NIL. ADMITTEDLY, DEPRECIATION UNDER SECTION 32 OF TH E ACT HAS TO BE ALLOWED ONLY ON WRITTEN DOWN VALUE OF THE ASSET. WHEN THE WRITTEN DOWN VALUE OF THE ASSET BE COMES NIL SINCE THE ENTIRE COST WAS ALLOWED AS APPLICATIO N OF INCOME UNDER SECTION 11 OF THE ACT, THIS TRIBUNAL I S OF THE CONSIDERED OPINION THAT THERE CANNOT BE ANY FURTHER CLAIM FOR DEDUCTION UNDER SECTION 32 OF THE ACT. IN VIEW O F THE ABOVE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION T HAT THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTIO N 32 OF THE ACT TOWARDS DEPRECIATION. HOWEVER, IT IS MADE CLEAR THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPTION UNDER SE CTION 11 OF THE ACT FOR ALL THE ASSESSMENT YEARS UNDER CONSIDERATION. 4. A SIMILAR VIEW WAS ALSO TAKEN BY THIS TRIBUNAL I N THE CASE OF MUSIC ACADEMY MADRAS V. DDIT(E) IN I.T.A. NO. 1098/ MDS/2015 DATED 22/4/2016. SINCE EXEMPTION UNDER SECTION 11 OF THE ACT FALLS UNDER CHAPTER III OF THE ACT, THE SAME WOULD OVERRI DE THE PROVISIONS OF SECTION 32 WHICH FALLS UNDER CHAPTER IV OF THE A CT. IN VIEW OF THE 4 I.T.A. NOS.2510 TO 2512/MDS/16 C.O. NOS.155 TO 157/MDS/16 ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INTE RFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SA ME IS CONFIRMED. 5. IN THE RESULT, BOTH, THE APPEALS OF THE REVENUE AS WELL AS THE CROSS-OBJECTIONS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON 13 TH APRIL, 2017 AT CHENNAI. SD/- SD/- ( ! . . # $% ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESAN) ' / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 8 /DATED, THE 13 TH APRIL, 2017. KRI. 0 24$9 :9,4 /COPY TO: 1. ./ /APPELLANT 2. 23./ /RESPONDENT 3. # ;4 () /CIT(A)-17, CHENNAI-34 4. # ;4 /CIT (EXEMPTIONS), CHENNAI 5. 9< 24 /DR 6. !+ = /GF.