Asst. Commissioner of Income Tax, (Exemptions), Hyderabad V. Andhra Pradesh State Civil Supplies Corporation Limited , Hyderabad

ITA 2176/Hyd/2018

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 7795 (ITAT-HYDERABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-B
• Assessment Year: 2015-2016
• Appeal Filed On: 14-11-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 11; 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD (THROUGH VIDEO CONFERENCE) BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER I.T.A. NO. 2176/HYD/2018 ASSESSMENT YEAR: 2015-16 ASST. COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD VS ANDHRA PRADESH STATE CIVIL SUPPLIES CORPORATION LIMITED, HYDERABAD [PAN: AABCA7164R] (APPELLANT) (RESPONDENT) C.O. NO. 02/HYD/2019 (IN ITA NO.2176/HYD/2018) ASSESSMENT YEAR: 2015-16 ANDHRA PRADESH STATE CIVIL SUPPLIES CORPORATION LIMITED, HYDERABAD [PAN: AABCA7164R] VS ASST. COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD (CROSS - OBJECTOR) (RESPONDENT) FOR REVENUE : SHRI Y.V.S.T.SAI, CIT-DR FOR ASSESSEE : SHRI D.V.ANJANEYULU, AR DATE OF HEARING : 07-01-2021 DATE OF PRONOUNCEMENT : 19-01-2021 O R D E R PER BENCH : THIS REVENUES APPEAL FOR AY.2015-16 ARISES FROM THE CIT(A)-9, HYDERABADS ORDER DATED 27-08-2018 PASSED IN CASE NO.10633/CIT(A)/HYD/2017-18 IN PROCEEDINGS U/S.143( 3) OF THE INCOME TAX ACT, 1961 [IN SHORT, THE ACT]. ITA NO. 2176/HYD/2018 C.O.NO. 02/HYD/2019 :- 2 -: HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE REVENUES SOLE SUBSTANTIVE GRIEVANCE CANVASSED IN THE INSTANT APPEAL SEEKS TO REVERSE THE CIT(A)S ACTION TR EATING THE ASSESSEE AS ENTITLED FOR SECTION 11 EXEMPTION CLAIM TO THE TUNE OF RS.21,32,54,560/- WHICH WAS DENIED BY THE ASS ESSING OFFICER IN HIS ASSESSMENT ORDER DT.22-12-2017. 3. LEARNED DEPARTMENTAL REPRESENTATIVE VEHEMENTLY CONTENDED DURING THE COURSE OF HEARING THAT THE ASSESSI NG OFFICER HAD RIGHTLY HELD THAT THE ASSESSEE IS NOT ENTITL ED FOR THE IMPUGNED EXEMPTION AS IT WAS NOT CARRYING ON THE CHAR ITABLE ACTIVITIES AS DEFINED IN SECTION 2(15) OF THE ACT (AME NDED FROM TIME TO TIME). CASE FILE SUGGESTS THAT THE INSTANT ISSUE OF THE ASSESSEES ENTITLEMENT FOR SECTION 11 IS NO MORE RESJU DICATA. THIS TRIBUNALS CO-ORDINATE BENCH FOR THE AY.2013-14 I NVOLVING REVENUES APPEAL IN ITA NO.986/HYD/2018 STANDS DECL INED ON 12-10-2018 VIDE THE FOLLOWING DETAILED DISCUSSION: 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE-C OMPANY, OWNED BY THE GOVERNMENT OF ANDHRA PRADESH, ENGAGED IN THE BU SINESS OF SUPPLY OF ESSENTIAL COMMODITIES TO THE PEOPLE IN GENERAL AND TO THOSE BELOW POVERTY LINE IN PARTICULAR UNDER THE PUBLIC D ISTRIBUTION SYSTEM (PDS), FILED ITS RETURN OF INCOME ON 30.08.3013 CLA IMING EXEMPTION U/S 11 OF THE ENTIRE INCOME OF RS. 7,71,85,211/-. D URING THE ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT, THE A .O. OBSERVED THAT THE TERM CHARITABLE PURPOSE U/S 2(15) OF THE ACT HAS UNDERGONE AMENDMENT WHEREIN ANY OTHER OBJECT OF GENERAL PUBLI C UTILITY, IF IT INVOLVES THE CARRYING ON OF ANY ACTIVITY IN THE NAT URE OF TRADE, COMMERCE OR BUSINESS, CANNOT BE TREATED AS CHARITAB LE IN NATURE. THEREFORE, OBSERVING THAT THE ASSESSEE IS INVOLVED IN SUCH ACTIVITY, HE DENIED THE EXEMPTION U/S 11 OF THE ACT AND BROUGHT IT TO TAX. ITA NO. 2176/HYD/2018 C.O.NO. 02/HYD/2019 :- 3 -: 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE T HE CIT(A), WHO GRANTED RELIEF TO THE ASSESSEE BY FOLLOWING THE DEC ISION OF THE ITAT IN THE ASSESSEES OWN CASE FOR THE A.YS 2009-10 & 2011 -12. AGGRIEVED BY THE RELIEF GRANTED BY THE CIT(A), REVENUE IS IN APPEAL BEFORE US. 5. THE LEARNED DEPARTMENTAL REPRESENTATIVE SUPPORTE D THE ORDER OF THE A.O, WHILE THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF THE CIT(A). LEARNED COUNSEL FOR THE ASSESS EE ALSO FILED A COPY OF THE ORDER OF THE TRIBUNAL IN ITA NO.117/HY/ 2017 FOR THE A.Y. 2012-13, DATED 10.08.2017. 6. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT IN THE EARLIER YEARS ALSO THE A.O HAD DISALLOWED THE CLAIM OF DEDUCTION U/S 11 OF THE ACT ON THE GROUND THAT THE AMENDED PROVISIONS OF SECTION 2(15) OF THE ACT APPLIES TO T HE ASSESSEE. WE FIND THAT THIS ISSUE HAD COME UP BEFORE THE TRIBUNAL FOR CONSIDERATION IN THE AYS 2009-10 AND 2011-12 AND THE ITAT HAD ALLOWE D THE EXEMPTION U/S 11 R.W.S 2(15) OF THE ACT AND THE SAM E WAS FOLLOWED BY THE COORDINATE BENCH OF THE TRIBUNAL FOR THE A.Y . 2012-13. HOWEVER, SINCE THE CIT(A) HAS ONLY FOLLOWED THE PRE CEDENT ON THE ISSUE AND THERE IS NO MATERIAL FILED BEFORE US BY T HE DEPARTMENT SHOWING THAT THE HONBLE HIGH COURT AT HYDERABAD HA S SUSPENDED OR SET-ASIDE THE ORDER OF THE TRIBUNAL, WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A). ACCORDINGLY , THE REVENUES APPEAL IS DISMISSED. 7. THE CROSS OBJECTION RAISED BY THE ASSESSEE IS ON LY IN SUPPORT OF THE ORDER OF THE CIT(A) AND THEREFORE NEEDS NO ADJU DICATION. ACCORDINGLY, THE CO ALSO IS DISMISSED. 3.1. THE REVENUE IS FAIR ENOUGH IN ITS PLEADINGS IN NOT PINPOINTING ANY DISTINCTION OF FACTS OR LAW IN THESE TWIN ASSESSMENT YEARS. WE THUS AFFIRM THE CIT(A)S ACTION BY ADOPTING THE REASONING OF THE CO-ORDINATE BENCH HEREIN ABOVE MUTATIS MUTANDIS. 4. THE ASSESSEES CROSS OBJECTION NO.02/HYD/2019 SUPPORTING THE CIT(A)S CONCLUSION UNDER CHALLENGE STA NDS RENDERED INFRUCTUOUS. ITA NO. 2176/HYD/2018 C.O.NO. 02/HYD/2019 :- 4 -: 5. THE REVENUES APPEAL IN ITA NO.2176/HYD/2018 IS DISMISSED AND THE ASSESSEES CROSS OBJECTION, C.O.NO.02/HYD/2019 IS DISMISSED AS INFRUCTUOUS. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH JANUARY, 2021 SD/- SD/- (LAXMI PRASAD SAHU) (S.S.GO DARA) ACCOUNTANT MEMBER JUDICIAL MEM BER HYDERABAD, DATED: 19-01-2021 TNMM ITA NO. 2176/HYD/2018 C.O.NO. 02/HYD/2019 :- 5 -: COPY TO : 1.THE ASST.COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD. 2.ANDHRA PRADESH STATE CIVIL SUPPLIES CORPORATION L IMITED, D.NO.6-3-655/1/A, CIVIL SUPPLIES BHAVAN, SOMAJIGUDA , HYDERABAD. 3.CIT(APPEALS)-9, HYDERABAD. 4.CIT(EXEMPTIONS)-HYDERABAD. 5.D.R. ITAT, HYDERABAD. 6.GUARD FILE.