Tamil Nadu Tennis Association, CHENNAI V. DCIT(E), CHENNAI

CO 181/CHNY/2016

• Counselvise Citation: [2018] 123 COUNSELVISE.COM (IT) 3407 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 month(s) 3 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 18-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 15-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S SRIDHAR
• Assessee Lawyers: C YAMUNA
• Keywords: Depreciation
• Section: 32; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI ... , !. , # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ./ ITA NOS.2558 & 2559/MDS/2016 & C.O. NOS.180 & 181/MDS/2016 (IN ITA NOS.2558 & 2559/MDS/2016) & '& / ASSESSMENT YEARS : 2011-12 & 2012-13 THE DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTIONS), CHENNAI CIRCLE, CHENNAI - 600 034. V. M/S TAMIL NADU TENNIS ASSOCIATION, SDAT, TENNIS STADIUM, LAKE AREA, NUNGAMBAKKAM, CHENNAI - 600 034. PAN : AAAAT 0164 H ()*/ APPELLANT) ( RESPONDENT & CROSS-OBJECTOR) )* + , / APPELLANT BY : SMT. C. YAMUNA, JCIT -.)* + , / RESPONDENT BY : SHRI S. SRIDHAR, ADVOCATE / + 0# / DATE OF HEARING : 17.01.2018 12' + 0# / DATE OF PRONOUNCEMENT : 18.01.2018 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: BOTH THE APPEALS OF THE REVENUE ARE DIRECTED AGAI NST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-17, DATED 30.03.2016 AND PERTAIN TO ASSESSMENT YEARS 20 11-12 AND 2012-13. THE ASSESSEE HAS ALSO FILED CROSS-OBJECTI ONS AGAINST THE 2 I.T.A. NOS.2558 & 2559/MDS/16 C.O. NOS.180 & 181/MDS/16 RESPECTIVE ORDERS OF THE CIT(APPEALS). THEREFORE, WE HEARD THE APPEALS AND THE CROSS-OBJECTIONS TOGETHER AND DISPO SING OF THE SAME BY THIS COMMON ORDER. 2. THE FIRST ISSUE ARISES FOR CONSIDERATION IS EXEM PTION CLAIMED BY THE ASSESSEE UNDER SECTION 11 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') IN RESPECT OF INCOME ON SALE OF TI CKETS, FACILITY FEE AND SPONSORSHIP FEE, ETC. 3. SMT. C. YAMUNA, THE LD. DEPARTMENTAL REPRESENTAT IVE, SUBMITTED THAT FOR THE ASSESSMENT YEARS 2009-10 AND 2010-11, IN THE ASSESSEE'S OWN CASE, THIS TRIBUNAL IN I.T.A. NO .1757 & 1758/MDS/2013 VIDE ITS ORDER DATED 28.11.2014, FOU ND THAT THE INCOME ON SALE OF TICKETS, FACILITY FEE AND SPONSOR SHIP RECEIPTS, ETC. ARE ELIGIBLE FOR EXEMPTION UNDER SECTION 11 OF THE ACT. ACCORDING TO THE LD. D.R., THE DEPARTMENT HAS ALREADY FILED AN A PPEAL AND THE MATTER IS PENDING BEFORE THE HIGH COURT. ACCORDING TO THE LD. D.R., WHEN THE OBJECT OF THE ASSESSEE WAS GENERAL PUBLIC UTILITY, THE INCOME DERIVED BY THE ASSESSEE FROM SALE OF TICKETS , FACILITY FEE, SPONSORSHIP FEE, ETC. ARE IN THE NATURE OF TRADE OR INCOME FROM BUSINESS, THEREFORE, IT IS HIT BY FIRST PROVISO TO SECTION 2(15) OF THE ACT. SINCE, ADMITTEDLY, TOTAL RECEIPTS EXCEEDED 25 LAKHS, ACCORDING 3 I.T.A. NOS.2558 & 2559/MDS/16 C.O. NOS.180 & 181/MDS/16 TO THE LD. D.R., THE ASSESSEE IS NOT ELIGIBLE FOR E XEMPTION UNDER SECTION 11 OF THE ACT. 4. WE HEARD SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE ALSO. THIS ISSUE WAS EXAMINED ELABORATELY BY THIS TRIBUNAL IN THE ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEARS 2009-1 0 AND 2010- 11. THIS TRIBUNAL FOUND THAT THE ASSESSEE IS ELIGI BLE FOR EXEMPTION IN RESPECT OF RECEIPTS FROM SALE OF TICKETS, FACILI TY FEE AND SPONSORSHIP FEES. SINCE THE CO-ORDINATE BENCH OF T HIS TRIBUNAL EXAMINED THIS ISSUE ELABORATELY IN THE ASSESSEE'S O WN CASE FOR ASSESSMENT YEARS 2009-10 AND 2010-11, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT MERE PENDENCY OF APPEAL BEF ORE THE HIGH COURT CANNOT BE A REASON TO TAKE A DIFFERENT VIEW. SINCE THE CIT(APPEALS) HAS RIGHTLY FOLLOWED THE ORDER OF THE CO-ORDINATE BENCH OF THIS TRIBUNAL IN THE ASSESSEE'S OWN CASE FOR THE ASSESSMENT YEARS 2009-10 AND 2010-11, THIS TRIBUNAL DO NOT FIN D ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY AND ACCORDINGLY THE SAME IS CONFIRMED. 5. IN THE CROSS-OBJECTIONS, THE ASSESSEE HAS RAISED THE ISSUE OF DEPRECIATION. 4 I.T.A. NOS.2558 & 2559/MDS/16 C.O. NOS.180 & 181/MDS/16 6. WE HEARD SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE AND SMT. C. YAMUNA, THE LD. DEPARTMENTAL REPRESENTA TIVE. THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSES SEE FOR DEPRECIATION UNDER SECTION 32 OF THE ACT ON THE GRO UND THAT THE COST OF ASSET WAS ALREADY ALLOWED AS APPLICATION OF INCO ME WHEN THE ASSET WAS ACQUIRED. IN FACT, THE CIT(APPEALS) HAS PLACED HIS RELIANCE ON THE ORDER OF THIS TRIBUNAL. NOW, THE A PEX COURT IN THE CASE OF CIT V. RAJASTHAN AND GUJARATI CHARITABLE FO UNDATION POONA IN CIVIL APPEAL NO.7186 OF 2014, FOUND THAT EVEN TH OUGH THE COST OF THE ASSET WAS ALLOWED AS APPLICATION OF INCOME IN T HE YEAR IN WHICH THE ASSET WAS ACQUIRED, THE INCOME OF THE TRUST HAS TO BE COMPUTED COMMERCIALLY BY ALLOWING DEPRECIATION AS PROVIDED U NDER SECTION 32 OF THE ACT. IN VIEW OF THIS JUDGMENT OF THE APEX C OURT, WE ARE UNABLE TO UPHOLD THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ASSESSING OFFICER IS DIRECTED TO ALLOW DEPRECIATION UNDER SEC TION 32 OF THE ACT. 7. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE S TAND DISMISSED. HOWEVER, BOTH THE CROSS-OBJECTIONS OF T HE ASSESSEE STAND ALLOWED. 5 I.T.A. NOS.2558 & 2559/MDS/16 C.O. NOS.180 & 181/MDS/16 ORDER PRONOUNCED ON 18 TH JANUARY, 2018 AT CHENNAI. SD/- SD/- (!. ) ( ... ) (M. BALAGANESH) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 18 TH JANUARY, 2018. KRI. + -056 76'0 /COPY TO: 1. )* /APPELLANT 2. -.)* /RESPONDENT 3. / 80 () /CIT(A)-17, CHENNAI-34 4. CIT (EXEMPTIONS), CHENNAI 5. 69 -0 /DR 6. :& ; /GF.