The Agricultural Produce Market Committee, Valsad V. The ACIT.,Valsad Circle, Valsad

ITA 1338/AHD/2009

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 57269 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 06-03-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 24-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHUL KUMAR
• Assessee Lawyers: MITISH S MODI
• Keywords: Benefit of exemption
• Section: 12A; 10B

Judgement Text

ITA N O.1338/AHD/2009 ASSES SMENT YEAR 2005- 06. . 1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD (BEFORE SHRI G.C.GUPTA VICE PRESIDENT & SHRI ANIL C HATURVEDI A.M.) I.T.A. NO. 1338 /AHD/2009 (ASSESSMENT YEAR: 2005 - 06 ) THE AGRICULTURAL PRODUCE MARKET COMMITTEE, DASHERA TEKRI, BECHAR ROAD, VALSAD. (APPELLANT) VS. ASSISTANT COMMISSIONER OF INCOME TAX, VALSAD CIRCLE, SURYA PRAKASH CHAMBER, DHARAMPUR ROAD, VALSAD. (RESPONDENT) PAN: AACFT 7207J APPELLANT BY : SHRI MITISH S. MODI RESPONDENT BY : SHRI RAHUL KUMAR, SR.D.R. ( )/ ORDER DATE OF HEARING : 6-3-2012 DATE OF PRONOUNCEMENT :16-3-12 PER: SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER. THIS APPEAL IS FILED BY THE ASSESSEE IS DIRECTED A GAINST THE ORDER OF LD. CIT(A), VALSAD DATED 16-3-2009 FOR THE ASSESSMENT Y EAR 2005-06. 2. THE SOLE GROUND OF APPEAL RAISED BY THE ASSESSEE READ AS UNDER:- ITA N O.1338/AHD/2009 ASSES SMENT YEAR 2005- 06. . 2 THE LD. C.I.T.(A) VALSAD ERRED IN CONFIRMING THE OR DER OF DEPUTY COMMISSIONER OF INCOME TAX, VALSAD RANGE, VALSAD FO R TAXING GROSS RECEIPTS INSTEAD OF INCOME ON FACTS AND IN LAW. 3. THE ASSESSEE HAS FILED ITS RETURN OF INCOME IN T HE CAPACITY OF A LOCAL AUTHORITY AND IS INVOLVED IN THE COLLECTION OF AGRI CULTURAL MARKET CESS FEE ON AGRICULTURAL PRODUCTS FROM THE TRADERS, WHOLE-SELLE RS AND RETAILERS OF VALSAD AND SURROUNDING AREAS OF VALSAD TALUKA AS PER THE C ONSTITUTION OF APMC. ACT. IT ALSO LETS OUT GODOWNS ON RENTAL BASIS TO T RADERS ETC., AND EARNS RENTAL INCOME. IT ISSUES LICENCE FOR AGRICULTURE PRODUCTS BUSINESS TO THE TRADERS AND COLLECT FEES FROM THE TRADERS AND EARNS RENTAL INCO ME. IT ISSUES LICENSE FOR AGRICULTURE PRODUCTS BUSINESS TO THE TRADERS AND CO LLECT LICENSE FEES FROM THE TRADERS. THE ASSESSEE BEING A LOCAL AUTHORITY ENJOY ED THE BENEFIT OF EXEMPTION U/S. 10(20) TILL 31-3-2002. 4. IN THE RETURN OF INCOME FILED BY THE ASSESSEE IT WAS NOTICED BY THE ASSESSING OFFICER THAT FROM THE GROSS TOTAL INCOME OF RS. 54,88,770/-, THE AMOUNT APPLIED TO CHARITABLE AND RELIGIOUS PURPOSE WAS REDUCED AND CLAIMED LOSS OF RS.15,54,688/-. THE ASSESSING OFFICER FURTH ER OBSERVED THAT NO AUDIT REPORT IN PRESCRIBED FORM 10B WAS FILED ALONG WITH THE RETURN OF INCOME. THE ASSESSEE WAS ASKED TO EXPLAIN AS TO HOW THE CLAIM W AS ADMISSIBLE AND HOW THE INCOME HAS BEEN CLAIMED FOR CHARITABLE OR RELIGIOUS PURPOSE. THE ASSESSEE SUBMITTED DETAILED EXPLANATION AND ALSO STATED THAT COMMITTEE FULFILLS THE OBJECT OF APMC OF GENERAL PUBLIC UTILITY AS PER SEC TION 2(15) AND HENCE IT WAS ENTITLED TO CERTIFICATE U/S 12A OF THE ACT. THE AS SESSING OFFICER OBSERVED THAT THE APPLICATION MADE BY THE ASSESSEE FOR REGISTRATI ON U/S. 12A OF THE ACT WAS REJECTED BY THE CIT VALSAD VIDE ORDER DATED 29-6-20 06 AS THE ACTIVITIES OF ITA N O.1338/AHD/2009 ASSES SMENT YEAR 2005- 06. . 3 APMC VALSAD WAS NOT CHARITABLE IN NATURE AND HENCE THE ASSESSEE WAS NOT ENTITLED TO DEDUCTION U/S. 11 OF THE ACT. ACCORDING LY, THE EXEMPTION CLAIMED U/S. 11 OF THE ACT AMOUNTING TO RS.54,88,770/- WAS DISALLOWED. 4. AGGRIEVED BY THE ABOVE DISALLOWANCE, THE ASSESSE E CARRIED THE MATTER IN APPEAL BEFORE THE CIT (A). CIT (A) UPHELD THE ORDER OF THE ASSESSING OFFICER IN VIEW OF THE FACT THAT THE ASSESSEES APPLICATION FOR REGISTRATION U/S. 12A WAS REJECTED BY THE CIT VALSAD. AGGRIEVED BY THE ABOVE ORDER OF CIT (A), NOW THE ASSESSEE IS IN APPEAL BEFORE US. 5. THE LD. AR SUBMITTED THAT, IN ITS OWN CASE, THE HONBLE TRIBUNAL A BENCH, AHMEDABAD IN ITA NO. 2432/AHD/2011 VIDE ORDE R DATED 5-1-2012 HAS HELD THAT THE ASSESSEE IS ENTITLED TO REGISTRATION U/S.12A WITH EFFECT FROM 1-4- 2003.HE ALSO PRODUCED THE ORDER OF THE TRIBUNAL WHI CH IS PLACED ON RECORD. 6. THE LD. D.R. RELIED ON THE ORDER OF THE ASSESSIN G OFFICER. 7. WE HAVE HEARD RIVAL CONTENTIONS OF BOTH THE PART IES, PERUSED THE MATERIAL ON RECORD. IT IS A FACT THAT THE CO-ORDI NATE BENCH VIDE ORDER DATED 5- 1-2012 HAS HELD THAT THE ASSESSEE IS ENTITLED TO RE GISTRATION U/S. 12A OF THE ACT WITH EFFECT FROM 1-4-2003. THE REASON FOR DENIAL OF DEDUCTION WAS NON REGISTRATION OF THE ASSESSEE U/S. 12A. NOW SINCE T HE ASSESSEE HAS BEEN GRANTED REGISTRATION U/S. 12A OF THE ACT, WE SET ASIDE THE ORDER OF CIT (A) AND REMIT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICE R WITH A DIRECTION THAT THE ASSESSING OFFICER FOR FRESH ADJUDICATION IN ACCORDA NCE WITH LAW. WHILE DOING SO, HE WILL GIVE DUE AND FAIR OPPORTUNITY OF HEARIN G TO THE ASSESSEE AND DECIDE THE MATTER. ITA N O.1338/AHD/2009 ASSES SMENT YEAR 2005- 06. . 4 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 16 - 3 - 20 12. SD/- SD/- (G.C.GUPTA) (ANIL CHATURVEDI) VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD. S.A.PATKI. COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS)- VALSAD. 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD. 1.DATE OF DICTATION 6 - 3 -2012 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 9 / 3 / 2012 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S 12 - 3 -2012. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 16 - 3 -2012 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 16 - 3 -2012 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 16 - 3 -2012. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..