Shriram Chits Tamilnadu Pvt. Limited, CHENNAI V. ACIT, CHENNAI

ITA 1661/CHNY/2010

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 0987 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 15-03-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 06-10-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K E B RANGARAJANJR STA NDING
• Assessee Lawyers: R SIVARAMAN

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL:C- BENCH: CHENNAI (BEFORE SHRI HARI OM MARATHA, JM & SHRI AB RAHAM P GEORGE, AM) ITA NO.1661/MDS/10 ASST. YEAR 2007-08 SHRIRAM CHITS TAMILNADU P. LTD, VS. THE ACIT, CO. CIR.VI(2), CHENNAI 149 GREAMS ROAD, CHENNAI 600006 (APPELLANT) (RESPONDENT) (PAN AABCS0167N) APPELLANT BY: SHRI R.SIVARAMAN RESPONDENT BY: SHRI K.E.B.RANGARAJAN,JR.S TANDING COUNSEL ORDER PER ABRAHAM P.GEORGE, ACCOUNTANT MEMBER IN THIS APPEAL FILED BY THE ASESSEE, ITS GRIEVANCE IS THAT FOREMANS DIVIDEND OF ` ,2,83,45,149/- HAD TO BE EXCLUDED ON THE GROUND OF MUTUALITY. 2. SHORT FACTS APROPOS ARE THAT ASSESSEE, ENGAGED I N THE BUSINESS OF CHIT FUND HAD CLAIMED FOREMANS DIVIDEND OF ` 2,83,45,149/- AS EXEMPT FROM TAX, BASED ON THE PRINCIPLE OF MUTUALITY. ACCORDING TO THE ASSESSEE, SUCH DIVIDENDS WHICH AROSE ON ACCOUNT OF SUBSCRIPTION TO CHITS WAS NOT AN INCOME. THIS ARGUMENT OF THE ASSESSE WAS NOT ACCEPTED EITHER BY THE AO OR THE CIT(A). 3. NOW BEFORE LUS, LD. AR FAIRLY ADMITTED THAT THE ISSUE WAS COVERED AGAINST THE ASSESSEE BY THE DECISION OF THIS TRIBUNAL FOR THE E ARLIER ASSESSMENT YEARS. ITA NO.1661/MDS/10 2 4. WE HAVE PERUSED THE ORDERS. THIS ISSUE REGARDING TAXABILITY OF FOREMANS DIVIDEND HAD COME UP BEFORE THIS TRIBUNAL ASSESSEE S OWN CASE FOR THE ASST. YEAR 2006- 07. IN ITS DECISION DATED 03-12-2010 IN ITA NO.517 /MDS/10 IT WAS HELD BY THIS TRIBUNAL AS UNDER: 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE APPELLANT, A COMPANY, IS ENGAGED INC HIT FUND BUSINESS. THE ONLY ISSUE INVOL VED IN THIS APPEAL IS REGARDING TAXING OF FOREMANS DIVIDEND AMOUNTING TO ` 3,35,37,414/-. THE APPELLANT COMPANY SUBSCRIBED TO CHITS CONDUCTED BY ITSELF AND ALSO RECEIVED DIVIDEND, BUT WHILE COMPUTING ITS TOTAL INCOME, DIV IDEND RECEIVE D WAS CLAIMED AS EXEMPT FROM TAX IN TERMS OF PRINCIPLES OF MUTUALITY, BUT THIS C LAIM OF THE ASSESEE COULD NOT BE ALLOWED IN VIEW OF THE DECISION OF THE CHENNAI BENC H OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR A. Y 1007-98 IN ITA NO.45/M DS/2001 DATED 17-2-2006. AGGRIEVED, THE ASSESSEE WENT BEFORE THE CIT(A), WHO ALSO DID NOT GIVE ANY RELIEF TO THE ASSESSEE. HENCE ASSESSEE IS IN APPEAL BEFORE US. 3. BEFORE US, IT HAS BEEN AGAIN PLEADED THAT ASSES SEE IS ENTITLED TO EXEMPTION OF TAX ON FOREMANS DIVIDEND BUT THIS BENCH HAS BEEN T AKING CONSISTENT VIEW IN ASSESEES OWN CASE THAT SUCH DIVIDEND EARNED WHEN C OMPANY HAS SUBSCRIBED TO CHITS CONDUCTED BY ITSELF AND HAS ALSO RECEIVED DIV IDEND, THE SAME IS NOT EXEMPT FROM TAX. THEREFORE, BY FOLLOWING THE CONSISTENT VI EW TAKEN BY THIS BENCH, WE CANNOT ALLOW THIS GROUND OF THE ASSESSEE. RESPECTFULLY FOLLOWING THIS DECISION, WE DISMISS TH E APPEAL OF THE ASSESSEE FOR THE IMPUGNED ASSESSMENT YEAR ALSO. 5. IN THE RESULT THE APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 15- 03-2 011. SD/- SD/- (HARI OM MARATHA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI: 15 TH MARCH, 2011. ITA NO.1661/MDS/10 3 CC: THE ASSESSEE 2)THE ASSESSING OFFICER 3)THE C IT(A) 4) THE CIT, 5)THE D.R 6)GUARD FILE. NBR