ITO (E), New Delhi V. Sadhu Vaswani Mission, New Delhi

ITA 1204/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3405 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 16-02-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 17-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Assessee Lawyers: S C GOYAL
• Keywords: Depreciation
• Section: 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL [ DELHI BENCH G DELHI ] BEFORE THE HONBLE VICEPRESIDENT, SHRI G.E. VEERABHA DRAPPA, AND SHRI I. P. BANSAL, JUDICIAL MEM BER. I. T. A. NO. 1204 (DEL) OF 2010 ASSESSMENT YEAR : 2006-07. THE INCOME-TAX OFFICER, SADHU VA SWANI MISSION, [EXEMPTION]; TRUST WARD : 1, VS. 2 ND STREET, SHANTI NIKETAN, N E W D E L H I. N E W D E L H I 110 021. P A N / G I R NO. AAA TS 0888C. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI S. C. GOYAL, C. A.; DEPARTMENT BY : SHRI B. R. R. KUMAR, SR. D. R. O R D E R. PER I. P. BANSAL, JM : THIS IS AN APPEAL FILED BY THE REVENUE. IT IS DIR ECTED AGAINST THE ORDER PASSED BY THE LD. CIT (APPEALS) DATED 15 TH DECEMBER, 2009 FOR ASSESSMENT YEAR 2006-07. 2. THE ASSESSEE IS A REGISTERED SOCIETY CARRYING ON CHARITABLE ACTIVITY. AN ADDITION, INTER ALIA, OF RS.29,18,013/- WAS MADE BY THE ASSESSING O FFICER TO THE INCOME OF THE ASSESSEE ON THE GROUND THAT THE SAME IS PERTAINING TO DEPRECIATION AND IT WILL AMOUNT TO DOUBLE DEDUCTION AS THE VALUE OF ENTIRE AMOUNT INVESTED IN THE FIXED ASSET ON WHICH DEPRECIATION IS CLAIMED WAS ALREADY ALLOWED AS APPLICATION OF INCOME. THE LEARNED ASSE SSING OFFICER WHILE HOLDING SO HAS RELIED UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE O F ESCORTS LTD. VS. UNION OF INDIA [1993] 199 2 I. T. A. NO. 1204 (DEL) OF 2010 ITR 43 (SC). THE SAID ADDITION HAS BEEN DELETED BY THE LD. CIT (APPEALS) FOLLOWING THE DECISION OF ITAT, DELHI BENCH IN THE CASE OF ASSTT. COMMISSI ONER OF INCOME-TAX, CIRCLE1, FARIDABAD VS. M/S. TINY TOTS EDUCATION SOCIETY, FARIDABAD, DA TED 2 ND JUNE, 2009 RENDERED IN I. T. APPEAL NO. 3182 (DEL) OF 2008. THE DEPARTMENT IS AGGRIEVE D WITH THE AFORE-MENTIONED FINDINGS OF THE LD. CIT (APPEALS) AND HAS FILED THE AFORE-MENTIONED APPEAL. 3. AFTER NARRATING THE FACTS IT WAS SUBMITTED BY TH E LD. SR. DR THAT THE VALUE OF ENTIRE ASSETS ON WHICH DEPRECIATION HAS BEEN CLAIMED BY THE ASSES SEE WERE EARLIER ALLOWED BY THE DEPARTMENT AS APPLICATION OF INCOME AND IF THE DEPRECIATION IS ALLOWED ON THOSE ASSETS, THEN IT WILL BE A CASE OF DOUBLE DEDUCTION, THEREFORE, ASSESSING OFFICER W AS RIGHT IN MAKING THE DISALLOWANCE AND THE LD. CIT (APPEALS) HAS WRONGLY DELETED THE SAME. 4. ON THE OTHER HAND, IT WAS SUBMITTED BY THE LEARN ED COUNSEL FOR THE ASSESSEE THAT THE DECISION OF THE ITAT, DELHI BENCH, RELYING UPON WHI CH THE CIT (APPEALS) HAS GIVEN RELIEF HAS BEEN CONFIRMED BY THE HONBLE PUNJAB & HARYANA HIGH COURT AND THE DECISION IS REPORTED AS 330 ITR 21 (P & H) AS ACIT VS. M/S. TINY TOTS EDUCA TION SOCIETY, FARIDABAD. IT WAS SUBMITTED THAT THE DEPARTMENTAL APPEAL WAS DISMISSED BY HONB LE HIGH COURT. COPY OF DECISION OF HONBLE HIGH COURT HAS BEEN FILED AT PAGES 6 TO 9 O F THE PAPER-BOOK. IT WAS FURTHER SUBMITTED THAT SIMILAR VIEW HAS BEEN TAKEN BY HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. MARKET COMMITTEE, PIPLI [2011] 330 ITR 16 (P & H) AND IN THIS MANNER IT WAS CLAIMED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE. 5. WE HAVE CAREFULLY CONSIDERED RIVAL SUBMISSIONS A ND MATERIAL PLACED BEFORE US. THE QUESTION RAISED BY THE REVENUE IN THE PRESENT APPEA L HAS BEEN ANSWERED BY THE AFORE-MENTIONED DECISION OF THE ITAT, DELHI BENCH IN THE CASE OF AC IT VS. M/S. TINY TOTS EDUCATION SOCIETY, FARIDABAD. THE SAID DECISION OF THE ITAT HAS BEEN CONFIRMED BY THE HONBLE PUNJAB & HARYANA HIGH COURT IN THAT CASE, THE CITATION OF WHICH HAS ALREADY BEEN GIVEN. EARLIER TO THAT, HONBLE PUNJAB & HARYANA HIGH COURT VIDE ITS ORDER DATED 5 TH JULY, 2010 IN THE CASE OF CIT VS. MARKET COMMITTEE, PIPLI (SUPRA) HAD HELD THAT IT WILL NOT BE A CASE OF DOUBLE DEDUCTION WHEN DEPRECIATION IS ALLOWED FOR COMPUTING INCOME FOR TH E PURPOSE OF SECTION 11 EVEN IF THE VALUE OF ENTIRE ASSET WAS CONSIDERED AS APPLICATION OF INCOM E IN THE CASE OF A CHARITABLE SOCIETY. WHILE HOLDING SO THEIR LORDSHIPS HAVE ALSO CONSIDERED THE DECISION OF HONBLE SUPREME COURT IN THE 3 I. T. A. NO. 1204 (DEL) OF 2010 CASE OF ESCORTS LTD. VS. UNION OF INDIA (SUPRA) WHI CH HAS BEEN RELIED UPON BY THE ASSESSING OFFICER. REFERENCE CAN BE MADE TO THE FOLLOWING OB SERVATIONS OF HONBLE PUNJAB & HARYANA HIGH COURT FROM THE CASE OF CIT VS. MARKET COMMITTE E, PIPLI (SUPRA) :- IN THE PRESENT CASE, THE ASSESSEE IS NOT CLAIMIN G DOUBLE DEDUCTION ON ACCOUNT OF DEPRECIATION AS HAS BEEN SUGGESTED BY LEARNED CO UNSEL FOR THE REVENUE. THE INCOME OF THE ASSESSEE BEING EXEMPT, THE ASSESSEE I S ONLY CLAIMING THAT DEPRECIATION SHOULD BE REDUCED FROM THE INCOME FOR DETERMINING THE PERCENTAGE OF FUNDS WHICH HAVE TO BE APPLIED FOR THE PURPOSES OF THE TRUST. THERE IS NO DOUBLE DEDUCTION CLAIMED BY THE ASSESSEE AS CANVASSED BY T HE REVENUE. THE JUDGEMENT OF THE HONBLE SUPREME COURT IN ESCORTS LTD. CASE [ 1993] 199 ITR 43 IS DISTINGUISHABLE FOR THE ABOVE REASONS. IT CANNOT B E HELD THAT DOUBLE BENEFIT IS GIVEN IN ALLOWING CLAIM FOR DEPRECIATION FOR COMPUT ING INCOME FOR PURPOSES OF SECTION 11. THE QUESTIONS PROPOSED HAVE, THUS, TO BE ANSWERED AGAINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE. THE APPEAL IS DISMISSED. 6. IN VIEW OF ABOVE DISCUSSION, WE FIND NO INFIRMIT Y IN THE ORDER OF THE LD. CIT (APPEALS) VIDE WHICH THE IMPUGNED ADDITION HAS BEEN DELETED, WE DECLINE TO INTERFERE. 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON : 22 ND JULY, 2011. SD/- SD/- [ G. E. VEERABHADRAPPA ] [ I. P. BANSAL ] VICE PRESIDENT. JUDICIAL MEM BER DATED : 22 ND JULY, 2011. *MEHTA * COPY OF THE ORDER FORWARDED TO : - 1. APPELLANT. 4 I. T. A. NO. 1204 (DEL) OF 2010 2. RESPONDENT. 3. CIT, 4. CIT (APPEALS), 5. DR, ITAT, NEW DELHI. TRUE COPY. BY ORDER. ASSISTANT REGISTRAR, ITAT. 5 I. T. A. NO. 1204 (DEL) OF 2010