The Press Club of Odisha, Bhubaneswar V. ITO (Exemption) Ward, Bhubaneswar

ITA 179/CTK/2022

AI Insights

The case involves The Press Club of Odisha appealing against the order of the CIT(A), NFAC, Delhi, which confirmed the rejection of their application under section 154 of the Income Tax Act. The application was initially rejected by the Assessing Officer (AO) due to an alleged error in filing the correct tax return form and misreporting the members' subscription fee as a voluntary contribution, which led to a tax demand. The assessee argued that the corpus fund contributed by the club members was exempt from tax under the doctrine of mutuality and that the CIT(A) had erred in confirming the AO's decision without a proper hearing, violating principles of natural justice.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 300380 (ITAT-CUTTACK)
• Duration Of Justice: 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: DB
• Next Hearing Date: 22-08-2023
• Assessment Year: 2014-2015
• Appeal Filed On: 30-11-2022
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Opportunity of being heard; Principle of natural justice

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BEFORE AND The Press Club of Odisha, Qr. No.VII DS1/1, Master Canteen Square, Unit Bhubaneswar. PAN/GIR No. (Appellant Per Bench This is an appeal filed by the assessee aga CIT(A), NFAC, Delhi, ITBA/NFAC/S/250/2022 15. 2. Shri D.Parida, CA appeared for the assessee and Shri S.C.Mohanty, ld Sr DR appeared for the revenue. 3. It was submitted by ld AR that the CIT(A), NFAC, erred in confirming the order of rejecting the application u/s.154 of the Act IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK (Through virtual hearing) BEFORE S/SHRI GEORGE MATHAN, JUDICIAL AND RAJESH KUMAR, ACCOUNTANT MEMBER ITA No.179/CTK/2022 Assessment Year : 2014-15 The Press Club of Odisha, Qr. No.VII DS1/1, Master Canteen Square, Unit-III, Bhubaneswar. Vs. Income Tax officer (Exemptions), Ward, Bhubaneswar. PAN/GIR No.AACTT 3137 H (Appellant) .. ( Respondent Assessee by : Shri D.Parida, CA Revenue by : Shri S.C.Mohanty, Sr DR Date of Hearing : 23/08 Date of Pronouncement : 23/0 O R D E R This is an appeal filed by the assessee against the order of the ld CIT(A), NFAC, Delhi, dated 23.10.2022 ITBA/NFAC/S/250/2022-23/1046453146(1) for the assessment year Shri D.Parida, CA appeared for the assessee and Shri S.C.Mohanty, ld Sr DR appeared for the revenue. It was submitted by ld AR that the CIT(A), NFAC, erred in confirming the order of rejecting the application u/s.154 of the Act Page1 | 3 IN THE INCOME TAX APPELLATE TRIBUNAL, JUDICIAL MEMBER , ACCOUNTANT MEMBER Income Tax officer (Exemptions), Ward, Bhubaneswar. Respondent) D.Parida, CA : Shri S.C.Mohanty, Sr DR 8/2023 /08/2023 inst the order of the ld in Appeal No. for the assessment year 2014- Shri D.Parida, CA appeared for the assessee and Shri S.C.Mohanty, ld It was submitted by ld AR that the CIT(A), NFAC, Delhi has grossly erred in confirming the order of rejecting the application u/s.154 of the Act ITA No.179/CTK/2022 Assessment Year : 2014-15 Page2 | 3 by the AO without adjudicating the fact that the corpus fund contributed by the club members of Rs.56,10,000/- is exempted from tax on the doctrine of mutuality. It was the submission that the ld CIT(A) has passed the order exparte without giving reasonable opportunity of hearing to the assessee, which is clear violation of natural justice. He submitted that the assessee trust is not for profit making organization, which was established solely for the welfare and development of the journalist working in the State of Odissa. It was the submission that for the impugned assessment year, the assessee had filed ITR-7 by mistake in place of ITR-5 wherein, members’s subscription fee of Rs.56,10,000/- has been wrongly entered as voluntary contribution. Subsequently, in the intimation u/s.143(1), a demand was raised of Rs.22,82,978/-. Against the intimation, application u/s.154 of the Act was filed, which was rejected by the ld CIT(A) exparte without giving any reasonable opportunity to substantiate the claim of the assessee trust. It was the submission that the matter be restored to the file of the ld CIT(A) for fresh adjudication after hearing the assessee. 4. In reply, ld Sr DR supported the order of the ld CIT(A). 5. We have heard the rival submissions. A perusal of the order of the ld CIT(A) shows that as there was no response from the side of the assessee in response to the notices, the appeal was decided on the basis of facts on record. Before us, ld AR undertakes that if one more opportunity is given, the assessee would be in a position to clarify in regard to the contribution ITA No.179/CTK/2022 Assessment Year : 2014-15 Page3 | 3 received by the members of the assessee trust. In view of above, as the impugned order has been passed exparte, we, in the interest of justice, set aside the order of the ld CIT(A) and remit the matter back to his file to decide the appeal afresh after giving adequate opportunity of being heard to the assessee. The assessee is also directed to cooperate with the ld CIT(A) by furnishing necessary details for disposal of the appeal expeditiously. 6. In the result, appeal of the assessee stands partly allowed for statistical purposes. Order dictated and pronounced in the open court on 23/08/2023. Sd/- sd/- (Rajesh Kumar) (George Mathan) ACCOUNTANT MEMBER JUDICIAL MEMBER Cuttack; Dated 23/08/2023 B.K.Parida, SPS (OS) Copy of the Order forwarded to : By order Sr.Pvt.secretary ITAT, Cuttack 1. The Appellant : The Press Club of Odisha, Qr. No.VII DS1/1, Master Canteen Square, Unit-III, Bhubaneswar. 2. The Respondent: Income Tax officer (Exemptions), Ward, Bhubaneswar 3. The CIT(A)- NFAC, Delhi 4. Pr.CIT-, Bhubaneswar 5. DR, ITAT, Cuttack 6. Guard file. //True Copy//