The Ludhiana Aggarwal Co-op House Building Society Ltd., Ludhiana V. ITO, Ludhiana

CO 50/CHANDI/2009

• Counselvise Citation: [2011] 122 COUNSELVISE.COM (IT) 5709 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 7 month(s) 23 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 23-03-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 22-03-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 30-07-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N K SAINI
• Assessee Lawyers: S R CHHABRA
• Keywords: Capital receipt
• Section: 143(3); 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A, CHANDIGARH BEFORE SHRI D.K.SRIVASTAVA, ACCOUNTANT MEMBER AND MS.SUSHMA CHOWLA, JUDICIAL MEMBER C.O.NO.50/CHD/2009 ARISING OUT OF ITA NO.577 /CHD/2009 (ASSESSMENT YEAR : 2006-07) THE LUDHIANA AGGARWALA CO-OP. VS. INCOME-TAX OFFI CER HOUSE BUILDING SOCIETY LTD. WARD VI(3), LUDHIAN A. AGGAR NAGAR, FEROZEPUR ROAD, LUDHIANA. PAN: AAAAT2729G (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.R.CHHABRA RESPONDENT BY : SHRI N.K.SAINI, DR O R D E R PER SUSHMA CHOWLA, J.M, : THE CROSS OBJECTION FILED BY THE ASSESSEE IS AGAIN ST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (A), DATED 13.3.2009 RELATING TO ASSESSMENT YEAR 2006-07 AGAINST THE ORDER PASSED UN DER SECTION 143(3) OF THE INCOME-TAX ACT. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: (A) THE LEARNED CIT(A) FURTHER ERRED IN NOT ADJUDICATING GROUND NO.1 BEFORE HIM THAT RUNNING OF SCHOOL WAS NOT A COMMERCIAL ACTIVITY. (B) THE LEARNED CIT(A) FURTHER ERRED IN NOT EXEMPTING THE ENTIRE INCOME OF THE SCHOOL U/S 10(23C((VI) SPECIALLY WHEN APPROVAL WAS NOT DECLINED/REFUSED BY THE C.C.I.T. LUDHIANA. 2 (C) THE LEARNED CIT(A) ERRED IN LAW AND ON FACTS IN UPHOLDING THE ADDITION OF RS.18,59,500/- ON ACCOUNT OF ACCRETION TO THE DEVELOPMENT FUND AND BUILDING FUND WITHOUT APPRECIATING ASSESSEES SUBMISSIONS IN THIS REGARD. (D) THE LEARNED CIT(A) FURTHER ERRED IN NOT DELETING INTEREST U/S 234-B CHARGED BY AO WITHOUT APPRECIATING ASSESSEES SUBMISSIONS IN THIS REGARD. 3. THE LEARNED A.R. FOR THE ASSESSEE AT THE OUTSET POINTED OUT THAT THE ISSUES RAISED IN THE PRESENT CROSS OBJECTION ARE ID ENTICAL TO THE ISSUES RAISED BY THE ASSESSEE VIDE ITS CROSS OBJECTION FIL ED RELATING TO ASSESSMENT YEAR 2005-06 AND THE TRIBUNAL HAS REMITT ED THE ISSUES BACK TO THE FILE OF THE A.O. FOR RE-ADJUDICATION. 4. GROUND NO.(A) RAISED BY THE ASSESSEE IN ITS CROS S OBJECTION IS AGAINST THE ISSUE AS TO WHETHER THE RUNNING OF SCHO OL WAS A COMMERCIAL ACTIVITY OR NOT? THE TRIBUNAL IN C.O.NO.60/CHD/200 8 IN I.T.A.NO.900/CHD/2008 RELATING TO ASSESSMENT YEAR 2 005-06 VIDE CONSOLIDATED ORDER DATED 22.10.2010 HAD ADJUDICATED THE ISSUE IN PARA 19 AND THE SAME WAS REMITTED BACK TO FILE OF THE A.O. TO RE-ADJUDICATE WHILE DECIDING THE GROUND OF APPEAL NO.2 RAISED BY THE RE VENUE. FOLLOWING THE PARITY OF REASONING IN OUR EARLIER ORDER WE REM IT THIS ISSUE BACK TO THE FILE OF THE A.O. TO ADJUDICATE THE SAME IN LINE WITH OUT OBSERVATIONS IN PARA 19 OF THE ORDER DATED 22.10.2010. 5. SIMILARLY, GROUND NO.(B) RELATING TO EXEMPTION C LAIM IN RESPECT OF INCOME OF SCHOOL WHERE APPROVAL UNDER SECTION 10(23 C)(VI) OF THE ACT WAS DECLINED/REFUSED BY THE C.C.I.T., LUDHIANA WAS ADJUDICATED UPON BY THE TRIBUNAL (SUPRA) IN PARAS 17 & 18 OF THE ACT IT S ORDER DATED 22.10.2010. THE ISSUE RAISED IN THE PRESENT GROUND (B) IS IDENTICAL TO THE 3 ISSUE RAISED IN ASSESSMENT YEAR 2005-06 AND WE ACCO RDINGLY REMIT THE ISSUE BACK TO THE FILE OF THE A.O. TO DECIDE THE SA ME IN LINE WITH OUR OBSERVATIONS IN PARAS 17 & 18 OF THE ORDER DATED 22 .10.2010. 6. THE NEXT GROUND NO.(C) RAISED BY THE ASSESSEE IS AGAINST THE ADDITION ON ACCOUNT OF ACCRETION TO THE DEVELOPMENT FUND AND BUILDING FUND. SIMILAR ISSUE WAS RAISED BEFORE THE TRIBUNAL IN ASSESSMENT YEAR 2005-06 AND VIDE PARAS 10 TO 16 THE SAME WAS REMITT ED BACK TO THE FILE OF THE A.O. TO VERIFY THE NATURE OF RECEIPTS AND TO ADJUDICATE WHETHER THE SAME ARE IN THE NATURE OF CAPITAL RECEIPTS OR NOT, IN ACCORDANCE WITH LAW. THE ISSUE BEING IDENTICAL AND FOLLOWING THE SAME PA RITY OF REASONING WE REMIT THIS ISSUE ALSO BACK TO THE FILE OF THE A.O. 7. THE ISSUE IN GROUND NO.(D) IS AGAINST THE CHARGI NG OF INTEREST UNDER SECTION 234B OF THE ACT WHICH IS CONSEQUENTIA L IN NATURE AND HENCE THE SAME IS DISMISSED. 8. IN VIEW OF OUR OBSERVATIONS IN RESPECT OF GROUND NOS.(A) TO (C) BEING COVERED BY THE ORDER OF THE TRIBUNAL DATED 22 .10.2010, WE DIRECT THE REGISTRY TO APPEND THE COPY OF THE ORDER OF THE TRIBUNAL DATED 22.10.2010 TO THE PRESENT ORDER FOR REFERENCE. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS POSED AS INDICATED ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD DAY OF MARCH, 2011. SD/- SD/- (D.K.SRIVASTAVA) (SUSHMA CHOWLA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 23 RD MARCH , 2011 COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. .