DDIT (E)-1(1), MUMBAI V. M..I.G. CRICKET CLUB, MUMBAI

ITA 1802/MUM/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8332 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-03-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2002-2003
• Appeal Filed On: 08-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: HARIGOVIND SINGH
• Assessee Lawyers: JAYANT GOKHALE
• Keywords: Question of law
• Section: 12A; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B : MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER ITA. NO. 1802/MUM/2010 ASSESSMENT YEAR 2002-2003 ITA. NO. 1803/MUM/2010 ASSESSMENT YEAR 2003-2004 ITA. NO. 1804/MUM/2010 ASSESSMENT YEAR 2004-2005 ITA. NO. 1805/MUM/2010 ASSESSMENT YEAR 2005-2006 ITA. NO. 1806/MUM/2010 ASSESSMENT YEAR 2006-2007 DY.DIT(E)-1(1) MUMBAI. VS. M.I.G. CRICKET CLUB MUMBAI 51 PAN AAATM4779J (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI HARI GOVIND SINGH (DR) FOR RESPONDENT : SHRI JAYANT GOKHALE ORDER PER BENCH 1. THESE APPEALS WERE FILED BY THE REVENUE AND THE Y ARISE OUT OF THE IDENTICAL ORDERS PASSED BY THE ASSESSING OFFICER AS WELL AS THE CIT(A) CONCERNING THE ISSUE OF EXEMPTION UNDER SECTION 11 OF THE INCOME TAX ACT, 1961. 2. THE CASE OF THE ASSESSEE IS THAT ITS INCOME IS EXEMPT FROM LEVY OF TAX SINCE ASSOCIATION OF PERSONS WAS FORMED WITH THE MAIN OBJECT OF PROMOTING COOPERATION AMONGST THE MEMBERS AS WELL AS TO DEVELOP SPORTSMANSHIP, SPORTSMAN SPIRIT AND SOCIAL DUTY SENSE AND ALSO TO PROVIDE RECREATION FACILITIES FOR PEOPLE IN GENERAL IN ADDITION TO RENDER SEVERAL SERVICES LIKE ORGANISING BLOOD DONAT ION CAMPS ETC., ADMITTEDLY, ASSESSEE HAS BEEN GRANTED REGISTRATION UNDER SECTION 12A OF THE INCOME TAX ACT, 1961. 3. STANDARD REASONS GIVEN BY THE ASSESSING OFFICER FOR REJECTING THE CLAIM OF THE ASSESSEE WERE THAT ; 2 (A) THE CLUB IS NOT OPEN TO THE GENERAL PUBLIC (B) NON-MEMBERS ARE ADMITTED BY CHARGING COACHING FEES (C) ASSESSEE HAS NOT CARRIED OUT ANY ACTIVITY WHICH CAN BE SAID TO BE OF A CHARITABLE NATURE ; ON THE CONTRARY , BY EXTENDING FACILITIES TO NON-MEMBERS, ASSOCIATION AN D ITS MEMBERS ARE INVOLVED IN AN ACTIVITY OF A TRADING CH ARACTER WHICH CAN BE SEEN FROM THE FACT THAT THE ASSESSEE I S EARNING INCOME BY WAY OF DONATIONS, SUBSCRIPTION FE ES, ENTRANCE FEES, COACHING FEES ETC., 4. IT WAS THUS CONCLUDED THAT THE ASSESSEE IS NOT AN ASSOCIATION CREATED/ESTABLISHED FOR CHARITABLE PURP OSE, WITHIN THE MEANING OF THE PROVISIONS OF SECTION 2 (15) OF THE I.T. ACT, AND CONSEQUENTLY IT IS NOT ENTITLED TO EXEMPTION UNDER SECTION 11 OF THE ACT. 5. LEARNED CIT(A) ON THE OTHER HAND OBSERVED THAT THE ITAT, MUMBAI BENCH, IN ASSESSEES OWN CASE FOR THE ASSESS MENT YEARS 1998-99 TO 2001-2002, ANALYSED THE FACTS OF THE CAS E WHILE HOLDING THAT THE ASSESSEE IS ENTITLED TO EXEMPTION UNDER SE CTION 11 OF THE ACT. 6. AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. AT T HE TIME OF HEARING, LEARNED COUNSEL PLACED BEFORE US A COPY OF THE ORDER OF THE ITAT, MUMBAI BENCH AS WELL AS THE HONBLE HIGH COUR T OF JUDICATURE AT MUMBAI TO SUBMIT THAT UNDER IDENTICAL FACTS AND CIRCUMSTANCES THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE AND THE REFORE, FOR THE SAKE OF CONSISTENCY ASSESSEE SHOULD BE PERMITTED TO AVAI L THE BENEFIT UNDER SECTION 11 OF THE ACT. ITA. NO. 3104 TO 3107/MUM/2006 AND 3274 TO 3277/MUM/2006 DATED 24 TH APRIL, 2009 FOR THE ASSESSMENT YEARS 1998-99 TO 2001-02 (HIGH COURT, VIDE ITS ORDE R DATED 30 TH NOVEMBER, 2009, UPHELD THE ORDER OF THE ITAT BY HO LDING THAT REVENUE COULD NOT FIND FAULT WITH THE ORDER OF THE TRIBUNAL. 3 SINCE A REASONABLE AND POSSIBLE VIEW WAS TAKEN BY T HE BENCH, NO SUBSTANTIAL QUESTION OF LAW ARISES). 7. ON THE OTHER HAND LEARNED DR STRONGLY SUPPORTED THE ORDERS PASSED BY THE ASSESSING OFFICER. 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS AND PERUSED THE RECORD. ADMITTEDLY, THERE IS NO DIFFERE NCE IN THE FACTUAL MATRIX AS COMPARED TO THE ASSESSMENT YEARS 1998-99 TO 2000-2001. IN THE AFORECITED DECISION THE TRIBUNAL OBSERVED TH AT THE ASSESSEE HAVING BEEN GRANTED REGISTRATION AS A CHARITABLE IN STITUTION UNDER SECTION 12A OF THE ACT, IT WOULD NOT BE OPEN FOR AN AUTHORITY, INFERIOR TO THE AUTHORITY WHO HAS GRANTED REGISTRATION, TO T AKE A CONTRARY VIEW AND TO HOLD THAT IT IS NOT A CHARITABLE ORGANISATIO N. THE BENCH FURTHER OBSERVED THAT SO LONG AS ASSESSEE IS REGISTERED UND ER SECTION 12A OF THE ACT, THE ASSESSING OFFICER IS DUTY BOUND TO EXA MINE THE CLAIM OF THE ASSESSEE FOR EXEMPTION UNDER SECTIONS 11, 12 AN D 13 OF THE ACT AND IT CAN BE DENIED IN A CASE WHERE THERE IS VIOLA TION OF CONDITIONS SPECIFIED IN SECTIONS 11 TO 13 OF THE ACT WHEREAS, IN THE INSTANT CASE, THE ASSESSING OFFICER HAS NOT POINTED OUT ANY VIOLA TION AND MERELY MADE GENERAL OBSERVATIONS. THE BENCH FURTHER NOTICE D THAT PRINCIPLES OF MUTUALITY DOES APPLY TO THE CASE OF THE ASSESSEE AND AS LONG AS THE RECEIPTS ARE NOT TAINTED WITH COMMERCIALITY, INCOME IN THE FORM OF INTEREST ETC., CANNOT BE CONSIDERED AS TAXABLE. THE BENCH THUS CONCLUDED THAT THE ASSESSEE IS ENTITLED TO EXEMPTIO N UNDER SECTION 11 OF THE ACT. SINCE THE VIEW TAKEN BY THE LEARNED CIT (A), IN ALL THESE YEARS, IS IN CONSONANCE WITH THE VIEW TAKEN BY THE ITAT IN ASSESSEES OWN CASE FOR THE EARLIER YEARS, WE DO NOT FIND ANY INFIRMITY IN THE ORDERS PASSED BY THE LEARNED CIT(A) AND THEREFORE, AFFIRM THE ORDER OF THE LEARNED CIT(A). 4 ITA. NO. 1802 TO 1806/MUM/2010 MIG CRICKET CLUB 9. IN THE RESULT, APPEALS FILED BY THE REVENUE ARE DISMISSED, AS PRONOUNCED IN THE OPEN COURT. SD/- SD/- (B.RAMAKOTAIAH) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATE 03 RD MARCH, 2011 VBP/- COPY TO 1. DY. DIT (E)-1(1), ROOM NO. 504, PIRAMAL CHAMBERS , 5 TH FLOOR, PAREL, MUMBAI 12. 2. M.I.G. CRICKET CLUB, M.I.G. COLONY, BANDRA (E), MUMBAI 51 PAN AAATM4779J 3. CIT(A)-I, MUMBAI 4. DIT(E), MUMBAI 5. DR B BENCH 6. GUARD FILE. (TRUE COPY) BY ORDER ASST. REGISTRAR, ITAT, MUMBAI BENCHES MUMBAI.