ACIT Bwinai Range, V. Market Committee,

ITA 2062/DEL/2008

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3563 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 1 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-07-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2005-2006
• Appeal Filed On: 26-05-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SANJAY AWASTHI
• Keywords: Charitable institution; Set aside
• Section: 12; 2; 11

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH FRIDAY(D), NEW DELHI BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER & SHRI K.D. RANJAN, ACCOUNTANT MEMBER M.A NO. 527/D/2009 [IN ITA NO. 2062/D/08] ASSESSMENT YEAR: 2005-06 ACIT, VS. MARKET COMMITTEE, BIWANI RANGE, MANDI, SIWANI (BIWANI) BIWANI. PAN NO. - (APPLICANT) (RESPONDENT) APPLICANT BY: SH. SANJAY AWASTHI, SR. DR RESPONDENT BY: NONE ORDER PER I.P. BANSAL, J.M. VIDE MISCELLANEOUS APPLICATION FILED AS ABOVE, IT IS THE CASE OF REVENUE THAT A MISTAKE HAS CREPT IN THE ORDER OF TR IBUNAL DATED 27.2.09 IN ITA NO. 2062/DEL/08. 2. REFERENCE IS MADE BY THE REVENUE TO THE FOLLOWIN G OBSERVATION OF THE TRIBUNAL IN THE AFOREMENTIONED ORDER: - WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF LD . DR AND GONE THROUGH THE ORDER OF THE AO AS WELL AS THE CIT(A). IT HAS NOT BEEN DISPUTED THAT THE ASSESSEE HAS BEEN GRANTED REGISTRATION BY THE CIT AND HAS BEEN RECOGNIZED AS CHARITABLE INSTITUTION. THUS, THERE IS NO QUESTION OF ASSESSABLE INCOME UNLESS THERE IS VIOLATION OF ANY OF THE CONDITIONS. THE ASSESSEE HAS SOUGHT ACCUMULATION O F INCOME TO THE EXTENT OF 15% OF THE INCOME AS EXEMPT U/S 11(1)(A) OF THE ACT. IT HAS NOT BEEN SHOWN THAT SU CH CLAIM OF THE ASSESSEE WAS CONTRARY TO LAW. IF ASSESSEE IS A CHARITABLE INSTITUTION IT IS ENTITLED TO ACCUMULATE 15% OF MA NO. 527/D/09 2 INCOME U/S 11(1)(A) OF THE ACT. WE SEE NO INFIRMITY IN SUCH DIRECTION OF THE CIT(A). WE DECLINE TO INTERFERE A ND THIS APPEAL OF THE REVENUE IS DISMISSED. 3. IT IS CLAIMED THAT THE TRIBUNAL HAS COMMITTED A MISTAKE BY ALLOWING DEDUCTION OF RS. 4,75,921/- BY OBSERVING T HAT THE EXPENDITURE ON ACCOUNT OF CONSTRUCTION AND WIDENING OF ROAD WAS EARLIER ALLOWED BY THE AO BEING SIMILAR DEDUCTION FOR A.Y. 2004-05 AND ON GOING THROUGH THE RECORD IT IS NOTED THAT THE SAID ISSUE WAS SET ASIDE BY THE ITAT FOR A.Y. 2004-05 WHICH IS NOW PENDING AND IT CANNOT BE SAID THAT SIMILAR DEDUCTION WAS ALLOWED IN A.Y. 2004-05 BY THE AO. 4. TO PROPERLY APPRECIATE IT MAY BE OBSERVED THAT T HE GROUNDS OF APPEAL RAISED BY THE REVENUE IN ITA NO. 2062/DEL/20 08 READ AS UNDER: - WHETHER THE LD. CIT(A) ROHTAK IS CORRECT IN ALLOWI NG THE EXPENDITURE INCURRED ON WIDENING AND CONSTRUCTION O N ROADS AS APPLICATION OF INCOME IN TERMS OF SEC. 11 TO 13 OF THE INCOME TAX ACT, 1961 AND IN ALLOWING DEDUCTION OF R S. 10,13,154/- ON ACCOUNT OF ACCUMULATION OF INCOME TO THE EXTENT OF 15% OF INCOME AS EXEMPTED U/S 11(1)(A) OF THE I.T. ACT, 1961 WHEN THE DEPARTMENT IS PLANNING TO CONTES T THE ISSUE OF REGISTRATION BEFORE THE HONBLE APEX COURT BY FILING SLP. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROU NDS OF APPEAL BEFORE THE APPEAL IS HEARD OR DISPOSED OFF. 5. AS IT CAN BE SEEN THE SOLE GRIEVANCE OF THE REVE NUE IN THAT APPEAL WAS REGARDING NON-CONSIDERATION OF AMOUNT OF RS. 10 ,13,154/- BEING MA NO. 527/D/09 3 FALLING WITHIN 15% LIMIT OF ACCUMULATION OF INCOME. THERE WERE TWO ISSUES RAISED BEFORE CIT(A) FIRST WAS REGARDING ALL OWABILITY OR OTHERWISE OF A SUM OF RS. 4,75,921/- BEING EXPENSES INCURRED ON CONSTRUCTION AND WIDENING OF THE ROAD CLAIMED BY THE ASSESSEE AS APP LICATION OF INCOME AS ASSESSEE IS CONSIDERED TO BE A CHARITABLE INSTIT UTION FALLING WITHIN AMBIT OF SEC. 11 & 12 OF I.T. ACT, 1961. LD. CIT(A ) HAS ALLOWED SUCH CLAIM OF THE ASSESSEE AND THE DEPARTMENT DID NOT AG ITATE THAT GROUND IN ITS APPEAL. THE SAID AMOUNT WAS HELD TO BE INCURRE D BY THE ASSESSEE AS ONE OF ITS ACTIVITY PERMITTED BY THE OBJECTS. THE OTHER AMOUNT WAS A SUM OF RS. 10,13,154/- WHICH FALLS WITHIN THE LIMIT OF 15% OF ACCUMULATED PROFITS. 6. SINCE THE REVENUE ITSELF DID NOT RAISE GROUND RE GARDING 4,75,921/-, THE TRIBUNAL HAS NOT GIVEN ANY VERDICT ON THE SAID AMOUNT AND SIMPLY NARRATED THE FACTS IN EARLIER PARAS. THEREFORE, TH ERE IS NO MISTAKE IN THE ORDER OF THE TRIBUNAL AS POINTED OUT IN THE APPLICA TION AND AS ARGUED BY LD. DR AT THE TIME OF HEARING. 7. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE REVENUE HAS NO MERITS, HENCE DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 16.07.201 0 (K.D. RANJAN) (I.P. BANSAL) ACCOUNANT MEMBER JUDICIAL MEMBER DATED: 16.07.2010 KAVITA CHOPRA MA NO. 527/D/09 4 COPY TO: 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR TRUE COPY DEPUTY REGISTRAR