Income-tax Officer, Ward - 1(2), Nashik V. Nashik District Labour Society Co-op Federation Ltd, Nashik

ITA 1808/PUN/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2597 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 26-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH GAWLI
• Assessee Lawyers: HARSHAL A NASIKKAR
• Keywords: Tax effect

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE . , #, % BEFORE SHRI D.KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.1808/PUN/2017 ' ' / ASSESSMENT YEAR : 2014-15 THE INCOME TAX OFFICER, WARD-1(2), NASHIK ....... / APPELLANT / V/S. NASHIK DISTRICT LABOUR SOCIETY CO-OP. FEDERATION LTD., 1024/1, PLOT NO.3B, SHRAM SAHAKAR, CHUMBLE MARG, TIDKE COLONY, NASHIK 422002 PAN : AAABN0028M / RESPONDENT APPELLANT BY : SHRI RAJESH GAWLI RESPONDENT BY : SHRI HARSHAL A. NASIKKAR / DATE OF HEARING : 21.08.2018 / DATE OF PRONOUNCEMENT :21.08.2018 / ORDER PER D. KARUNAKARA RAO, AM THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF C IT(A)-1, NASHIK, DATED 12-05-2017 FOR THE A.Y. 2014-15. 2. GROUNDS RAISED BY THE REVENUE ARE EXTRACTED BELOW : 1. WHETHER THE FACTS AND IN THE CIRCUMSTANCE OF TH E CASE, THE LD.CIT(A)-1, NASHIK WAS JUSTIFIED IN ALLOWING EXEMP TION FROM INCOME-TAX TO THE ASSESSEE SOCIETY U/S.80P(2)(A)(VI) OF THE IN COME TAX ACT, 1961 EVEN 2 ITA NO.1808/PUN/2017 NASHIK DISTRICT LABOUR SOCIETY CO-OP. FEDERATION LTD., THOUGH THE ASSESSEE SOCIETY IS A FEDERATION OF PRIM ARY SOCIETIES WHICH ONLY SUPERVISES AND CO-ORDINATES THE AFFAIRS OF ITS MEMB ERS AND CANNOT BE SAID TO BE ENGAGED IN THE COLLECTIVE DISPOSAL OF THE LAB OUR OF ITS MEMBERS WITHIN THE MEANING OF SECTION 80P(2)(A)(VI) OF THE I.T. AC T, 1961. 2. WHETHER IN THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A)-1, NASHIK WAS JUSTIFIED IN HOLDING THAT T HE ASSESSEE WAS ENGAGED IN THE COLLECTIVE DISPOSAL OF THE LABOUR OF ITS MEMBERS WHEN THERE IS NO INDIVIDUAL WHO IS MEMBER OF THE ASSESSEE SOCI ETY. 3. BRIEFLY STATED RELEVANT FACTS INCLUDES THAT THE ASSESS EE IS A COOPERATIVE SOCIETY AND FILED ITS RETURN OF INCOME DECLARING TOTAL INCOME AT NIL AFTER CLAIMING DEDUCTION UNDER CHAPTER-IVA. IN THE ASSESSMENT, AO DISALLOWED RS.1,29,58,975/- U/S.80P(2)(A)(VI) OF THE ACT. AO ALSO MADE ADDITION OF RS.6,81,493/- ON ACCOUNT OF EXPENDITURE IN CURRED BY THE ASSESSEE IN RESPECT OF PRAWAS SANCALAK, PRASIDDHI AND PRINTING AND STATIONARY. EVENTUALLY, THE AO ASSESSED THE INCOME OF TH E ASSESSEE AT RS.36,55,180/- AS AGAINST NIL INCOME RETURNED BY THE ASSES SEE. IN THE FIRST APPELLATE PROCEEDINGS, THE CIT(A) DELETED BOTH THE AD DITIONS MADE BY THE AO RELYING ON THE DECISION OF PUNE BENCH OF THE T RIBUNAL IN THE ASSESSEES OWN CASE FOR THE A.YRS. 2006-07, 2008-09 AND 2009-10. AGGRIEVED WITH THE ORDER OF CIT(A), THE REVENUE IS IN APPEA L BEFORE US WITH THE GROUNDS REFERRED ABOVE. 4. AT THE OUTSET, LD. AR FOR THE ASSESSEE SUBMITTED THAT THE APPEAL FILED BY THE DEPARTMENT IS LIABLE TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT. THE LD. AR POINTED THAT AS PER CBDT CIRCULAR NO.3/ 2018 DATED 11 TH JULY, 2018, THE MONETARY LIMIT FOR FILING OF APPEAL BY THE DEPAR TMENT BEFORE THE TRIBUNAL IS RS.20 LAKHS, THEREFORE, THE APPEA L FILED BY THE DEPARTMENT IS NOT MAINTAINABLE. 5. ON THE OTHER HAND, THE LD. DR FOR THE REVENUE DEFENDE D THE ASSESSMENT ORDER AND PRAYED FOR REVERSING THE FINDINGS O F THE CIT(A). 3 ITA NO.1808/PUN/2017 NASHIK DISTRICT LABOUR SOCIETY CO-OP. FEDERATION LTD., HOWEVER, THE LD. DR FAIRLY ADMITTED THAT THE TAX EFFECT IN THE PRESENT APPEAL IS LESS THAN RS.20 LAKHS. 6. BOTH SIDES HEARD. ON GOING THROUGH THE FACTS OF THE C ASE AND THE ORDERS OF THE REVENUE, THE TOTAL TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS UNDISPUTEDLY LESS THAN RS. 20 LAKHS. THE CBDT CIRCULAR NO.3/2018 DATED 11 TH JULY, 2018 RAISED THE MONETARY LIMIT OF TAX EFFECT FOR FILING OF APPEAL BY THE DEPARTMENT BEFORE THE TRIBUNAL TO RS.20 LAKHS. THE CIRCULAR APPLIES TO THE PENDING APPEALS OF THE DEPARTMEN T BEFORE THE TRIBUNAL TOO. THUS, IN VIEW OF THE CBDT CIRCULAR, WE ARE O F THE OPINION THAT THE PRESENT APPEAL OF THE REVENUE IS LIABLE TO BE DIS MISSED ON ACCOUNT OF LOW TAX EFFECT WITHOUT GOING INTO THE MERITS OF THE CASE. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 21 ST DAY OF AUGUST, 2018. SD/- SD/- ( # /VIKAS AWASTHY) ( . /D. KARUNAKARA RAO) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / PUNE; / DATED : 21 ST AUGUST, 2018. SATISH + - / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT (APPEALS)-1, NASHIK 4. THE PR. CIT-1, NASHIK 5. , , - ' , / DR, ITAT, SMC BENCH, PUNE. 6. % / GUARD FILE. / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE