DDIT, Hyderabad V. Agricultural Market committee, Madanapuram

CO 17/HYD/2010

• Counselvise Citation: [2010] 122 COUNSELVISE.COM (IT) 4926 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 22-07-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2004-2005
• Appeal Filed On: 23-04-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K V N CHARYA
• Assessee Lawyers: SATYANARAYANA
• Section: 143(3); 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B , HYDERABAD BEFORE SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER CROSS OBJECTION NO.17/HYD/2010 ASSESSMENT YEAR 2004-05 ARISING OUT OF ITA NO.871/HYD/2009 THE AGRICULTURAL MARKET COMMITTEE, MADHANAPURAM VS DY. DIRECTOR OF INCOME TAX (E)- I, HYDERABAD (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI SATYANARAYANA RESPONDENT BY: SHRI K.V.N. CHARYA, DR O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THE CROSS OBJECTION FILED BY THE ASSESSEE ARISES OUT OF THE ITA NO.871/HYD/2009. 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS IN ITS APPEA L: 1. THE CIT(A) OUGHT TO HAVE CONSIDERED THE FACTS THAT THE INCOME OR PROFIT OF THE AGRICULTURAL MARKET COMMITTEE IS EXEM PT AS THE FEES COLLECTED BY IT IS DIVERTED BY OVER RIDING TITLE AN D THEREFORE, IS NOT AN INCOME WITHIN THE MEANING OF SEC.4 OR 5 OF THE IT A CT. 2. THE CIT(A) OUGHT TO HAVE CONSIDERED THE FACT THAT T HE INCOME OF THE AGRICULTURAL MARKET COMMITTEE IS NOT TAXABLE AS THE HONBLE TRIBUNAL HAS DIRECTED THE DIT(E) TO GRANT REGISTRATION U/S 1 2A OF THE IT ACT AND THEREFORE, THE INCOME HAS TO BE CONSIDERED FOR EXEMPTION U/S 11 OF THE IT ACT. 3. THE CIT(A) OUGHT TO HAVE CONSIDERED THE FACT THAT I N THE PROCESS OF ITS ACTIVITY, THE AGRICULTURAL MARKET COMMITTEE HAD TO INCUR EXPENDITURE IN ACCORDANCE WITH THE PROVISIONS OF AP AGRICULTURAL P RODUCE AND LIVESTOCK) MARKETS ACT, 1966 AND HAS TO INCUR EXPE NDITURE AS PER THE DIRECTIONS OF THE GOVT. OF AP AND SUCH EXPENSES ARE ALLOWABLE AS DEDUCTION U/S 36 (1) (XII) OF THE IT ACT. 2 3. FOR THE ASSESSMENT YEAR 2004-05, THE DY. DIRECTOR OF INCOME TAX (E) COMPLETED THE ASSESSMENT U/S 143(3) AND DENIED EXEMPT ION EITHER U/S 10(20) OR U/S 11 OF THE IT ACT. THE RESPONDENT CARR IED THE MATTER BEFORE THE HONBLE COMMISSIONER OF CIT(A)-IV, HYDERABAD WHO DISPOSED THE SAID APPEAL VIDE ORDER DATED 15.5.2009. THE LE ARNED CIT(A) HELD THAT THE INCOME OF THE AMC IS EXEMPT U/S 10(26AAB) OF THE IT ACT. THE SAID SECTION IS INTRODUCED BY THE FINANCE ACT 2008. THE HO NBLE ITAT, VISAKHAPATNAM VIDE CONSOLIDATED ORDER IN ITA NOS.90/VIZ AG/2007 ETC. DATED 28.11.2008 IN THE CASE OF AGRICULTURAL MARKET CO MMITTEE HELD THAT THE AMENDMENT MADE TO THE INCOME TAX ACT BY INTRODUCTI ON OF SEC.10(26AAB) AND SUCH AMENDMENT HAS A RETROACTIVE IN OP ERATION. THEREFORE, THE CIT(A) HELD THAT THE AMC IS ENTITLED FOR EXEMPTION U/S 10(26AAB) EVEN FOR THE ASSESSMENT YEAR 2004 -2005. HOWE VER, THE DEPARTMENT FILED AN APPEAL BEFORE THE HONBLE ITAT CO NTESTING THE ORDER OF THE CIT(A) IV, HYDERABAD IN ITA NO.871/HYD/2009. DURING THE RELEVANT PERIOD THE SECRETARY OF AMC, WANAPARTHY ROA D WAS SRI MD. MOINUDDIN. HE WAS TRANSFERRED FROM THE SAID PLACE IN T HE FIRST WEEK OF AUGUST 2009. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITT ED THAT THE PRESENT INCUMBENT SECRETARY JOINED AT AMC, WANAPARTHY ROAD ON 21.8.2009. HE DID NOT VERIFY THE BACK RECORD. THE P RESENT SECRETARY CAME TO KNOW OF THE APPEAL FILED BY THE DEPARTMENT W HEN THE HEARING NOTICE OF THE TRIBUNAL, POSTING THE APPEAL FOR HEARI NG ON 3.3.2010 WAS RECEIVED. HOWEVER, ON THE SAID DATE THE CASE WAS NOT LISTE D FOR HEARING. HE THEN CONSULTED THE COUNSEL, HYDERABAD IN THE SECOND WEEK OF MARCH, 2010 WHEN IT WAS INFORMED THAT CROSS OBJECTIONS NEED T O BE FILED AGAINST THE APPEAL PREFERRED BY THE DEPARTMENT. TH EREAFTER THE MATTER WAS DISCUSSED WITH THE ASST. DIRECTOR OF MARKETING, MAHABO OBANAGAR AND ACCORDINGLY THE CO IS BEING FILED ON 23.4.2010. THERE WAS A DELAY OF 235 DAYS IN FILING THE CO. HE PRAYED FOR CONDONATI ON OF DELAY IN FILING THE APPEAL. 3 4. WE HAVE HEARD BOTH THE PARTIES ON THIS ISSUE. WE FOUND THAT THERE WAS A DELAY OF 215 DAYS (IT IS NOT 235 DAYS AS PLEADED BY LEARNED COUNSEL FOR THE ASSESSEE) IN FILING THE APPEAL BY THE ASSE SSEE BEFORE THIS TRIBUNAL. THE ASSESSEE HAS NOT EXPLAINED THE REASON FOR THE DELAY IN FILING ITS APPEAL. THE ASSESSEE HAS NOT SHOWN THAT IT WAS DILIGENT AND WAS NOT GUILTY OF NEGLIGENCE WHATSOEVER. THE SUFFICIEN T CAUSE WITHIN THE CONTEMPLATION OF THE LIMITATION PROVISION MUST BE A CAUSE WHICH IS BEYOND THE CONTROL OF THE PARTY IN INVOKING THE AID OF THE PROVISIONS. THE HONBLE SUPREME IN THE CASE OF RAMLAL VS. REWA COAL FIELDS LTD. (AIR 1962 SC 361) HAS HELD THAT THE CAUSE FOR THE DELA Y IN FILING THE APPEAL WHICH BY DUE CARE AND ATTENTION COULD HAVE BEEN AVOIDED CANNOT BE A SUFFICIENT CAUSE WITHIN THE MEANING OF THE LIMITA TION PROVISION. WHERE NO NEGLIGENCE NOR INACTION, OR WANT OF BONA FID ES CAN BE IMPUTED TO THE ASSESSEE A LIBERAL CONSTRUCTION OF THE PROVISIONS HA S TO BE MADE IN ORDER TO ADVANCE SUBSTANTIAL JUSTICE. SEEKERS OF JUSTICE MUST COME WITH CLEAN HANDS. IN THE PRESENT CASE, THERE WAS NO SUFFICIENT CAUSE TO SHOW THAT THE DELAY WAS DUE TO BONA FIDE REASONS. THE ASSESSE E COULD HAVE VERY WELL AVOIDED THE DELAY BY EXERCISING DUE CARE AND ATTENTION. HENCE, IN OUR OPINION, THERE EXISTS NO SUFFICIENT AND GO OD REASON FOR THE DELAY OF 215 DAYS. THEREFORE, WE DISMISS THE APPEAL FI LED BY THE ASSESSEE WITHOUT ADMITTING THE SAME. 5. IN THE RESULT THE CROSS OBJECTION FIELD BY THE A SSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT 22.7.2010 SD/- SD/- G.C. GUPTA CHANDRA POOJARI VICE PRESIDENT ACCOUNTANT MEMBER DATED THE 22ND JULY, 2010 4 COPY FORWARDED TO: 1. SHRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHRIYAS ELEGANCE, DOOR NO.3-6-643, ST. NO.9, HIMAYATNAGAR, HYDERABAD 2. THE DY. DIT(E)-I, HYDERABAD 3. CIT(A), HYDERABAD. 4. CIT, HYDERABAD 5. THE D.R., ITAT, HYDERABAD. NP