RAMKRISHNA BAJAJ CHARITABLE TRUST , Mumbai V. CIT (A)-1, Mumbai

ITA 2226/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 1604 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2015-2016
• Appeal Filed On: 09-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANPREET SINGH DUGGAL
• Keywords: Charitable institution; Maximum Marginal Rate; Competent authority; Condonation of delay
• Section: 12; 10; 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D , MUMBAI BEFORE S HRI SHAMIM YAHYA (AM ) AND SHRI RAM LAL NEGI (JM) ITA NO. 2226 /MUM/2019 ASSESSMENT Y EAR: 2015 - 16 RAMKRISHNA BAJAJ CHARITABLE TRUST, BAJAJ BHAWAN, 2 ND FLOOR, JAMNALAL BAJAJ MARG, 2 26 NARIMAN POINT, MUMBAI - 400021 PAN: AAATR1693Q VS. THE INCOME TAX OFFICER (EXEMPTION) 2 (2), PIRAMAL CHAMBERS, LALBAUG, PAREL, MUMBAI - 400021 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI M.A. GOHEL (A R) REVENUE BY : SHRI MANPREET SINGH DU GGAL, SALIL MISHRA, O. THARIAN, H.N. SINGH (DRS) DATE OF HEARING: 18 /11 /2020 DATE OF PRONOUNCEMENT: 23 / 11 /2020 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AG AINST THE ORDER DATED 07.02.2019 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 1 (FOR SHORT THE CIT(A) , MUMBAI , FOR THE ASSESSMENT YEAR 2015 - 16 , WHEREBY THE LD. CIT(A) HAS DISMISSED T HE APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER PASSED U/S 143 (3) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT). 2. THE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) ON THE FOLLOWING EFFECTIVE GROUND S : - I . DENIAL OF EXEMPTION IN RESPECT OF DIVIDEND INCOME RS. 3,38,78,340/ - 1.1 O N THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED ASSESSING OFFICER ERRED IN DENYING EXEMPTION UNDER SECTION 10(34) OF THE ACT IN RESPECT OF DIVIDEND INCOME OF THE APPELLANT. 2 ITA NO. 2226 / MUM/2019 ASSESSMENT YEAR: 201 5 - 1 6 1.2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED ASSESSING OFFICER ERRED IN LEVYING TAX ON DIVIDEND INCOME AT MAXIMUM MARGINAL RATE OF TAX THEREBY IGNORING THE EXEMPTION AVAILABLE UNDER SECTION 10 (34) OF THE ACT. 1.3 THE LEARNED ASSESSING OFFICER FAILED TO APPRECIATE THAT THE APPELLA NT HAS NOT CLAIMED BENEFITS OF SECTION 11 AND 12 OF THE ACT IN THE RETURN OF INCOME FILED FOR THE ABOVE YEAR. HENCE, THE QUESTION OF WITHDRAWING EXEMPTION UNDER SECTION 11 AND 12 OF THE ACT DOES NOT ARISE. 1.4 THE LEARNED ASSESSING OFFICER FAILED TO APPREC IATE THE JUDICIAL PRONOUNCEMENTS OF THE JURISDICTIONAL BOMBAY HIGH COURT AND THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI ON IDENTICAL ISSUE. THE LEARNED ASSESSING OFFICER FAILED TO APPRECIATE THE EXPLANATION GIVEN AND SUBMISSIONS MADE BY THE APPELLANT. 1.5 THE LEARNED ASSESSING OFFICER FAILED TO APPRECIATE THAT IN THE CASE OF THE APPELLANT ITSELF, UNDER IDENTICAL CIRCUMSTANCES, IN EARLIER YEARS THE EXEMPTION HAS BEEN ALLOWED IN RESPECT OF ITS DIVIDEND INCOME. IT IS SUBMITTED THAT THERE BEING NO CHANGE IN THE FACTS AND CIRCUMSTANCES OF THE CASE NOR LAW, THE LEARNED ASSESSING OFFICER IS NOT JUSTIFIED IN DENYING THE EXEMPTION. 1.6 THE LEARNED ASSESSING OFFICER FAILED TO APPRECIATE THE IMPLICATIONS OF THE PROVISION OF THE NEWLY INSERTED SECTION 11(7) OF THE ACT W ITH EFFECT FROM 01.04.2015. 3 . AT THE OUTSET, THE L D . COUNSEL FOR THE APPELLANT/ ASSESSEE SUBMITTED THAT ASSESSEE HAS OPTED TO SETTLE THE DISPUTE UNDER VIVAD SE VISHWAS ACT, 2020, THEREFORE THE APPEAL MAY BE KEPT IN ABEYANCE. 4 . THE LD. DEPARTMENTAL REPRE SENTATIVE DID NOT OPPOSE THE AFORESAID SUBMISSIONS MADE BY THE LD. COUNSEL. I N THE CASE OF M/S. NANNUSAMY MOHAN (HUF) VS . ACIT , THE HONBLE MADRAS HIGH COURT HAS DISMISSED THE APPEAL OF THE ASSESSEE AS WITHDRAWN IN WHICH THE COUNSEL HAD MADE THE SIMILAR SU BMISSIONS BEFORE THE HONBLE COURT. THE OBSERVATIONS OF THE HONBLE HIGH COURT ARE AS UNDER: - 3. THE LEARNED COUNSEL FOR THE APPELLANT / ASSESSEE, ON INSTRUCTIONS, SUBMITTED THAT THE APPELLANT / ASSESSEE INTENDS TO AVAIL THE BENEFIT OF VIVAD SE VISHWAS SC HEME (VVS SCHEME FOR BREVITY) AND IN THIS REGARD, THE ASSESSEE IS TAKING STEPS TO FILE THE APPLICATION / DECLARATION IN FORM NO. I. 3 ITA NO. 2226 / MUM/2019 ASSESSMENT YEAR: 201 5 - 1 6 4. IT MAY NOT BE NECESSARY FOR THIS COURT TO DECIDE THE SUBSTANTIAL QUESTIONS OF LAW FRAMED FOR CONSIDERATION ON ACCOUNT OF CERTAIN SUBSEQUENT DEVELOPMENTS. THE GOVERNMENT OF INDIA ENACTED THE DIRECT TAX VIVAD SE VISHWAS ACT, 2020 (ACT 3 OF 2020) TO PROVIDE FOR RESOLUTION OF DISPUTED TAX AND FOR MATTERS CONNECTED THEREWITH OR INCIDENTAL THERETO. THE ACT OF THE PARLIAMENT REC EIVED THE ASSENT OF THE PRESIDENT ON 17 TH MARCH 2020 AND PUBLISHED IN THE GAZETTE OF INDIA ON 17 TH MARCH 2020. 5. IN TERMS OF THE SAID ACT, THE ASSESSEE HAS BEEN GIVEN AN OPTION TO PUT AN END TO THE TAX DISPUTES, WHICH MAY BE PENDING AT DIFFERENT LEVELS EITHER BEFORE THE FIRST APPELLATE AUTHORITY OR BEFORE THE TRIBUNAL OR BEFORE THE HIGH COURT OR BEFORE THE HON'BLE SUPREME COURT OF INDIA. UNDER SECTION 2(J) DISPUTED TAX HAS BEEN DEFINED. IN TERMS OF SECTION 3, WHERE A DECLARANT MEANS A PERSON, WHO FILES A DECLARATION UNDER SECTION 4 ON OR BEFORE THE LAST DATE FILES A DECLARATION TO THE DESIGNATED AUTHORITY IN ACCORDANCE WITH THE PROV ISIONS OF SECTION 4 IN RESPECT OF TAX ARREARS, THEN, NOTWITHSTANDING ANYTHING CONTAINED IN THE INCOME TAX ACT OR ANY OTHER LAW FOR THE TIME BEING IN FORCE, THE AMOUNT PAYABLE BY THE DECLARANT SHALL BE DETERMINED IN TERMS OF SECTION 3(A - C) THEREUNDER. 6. THE FIRST PROVISO TO SECTION 3 STATES THAT IN CASE, WHERE AN APPEAL OR WRIT PETITION OR SPECIAL LEAVE PETITION IS FILED BY THE INCOME TAX AUTHORITY ON ANY ISSUE BEFORE THE APPELLATE FORUM, THE AMOUNT PAYABLE SHALL BE ONE - HALF OF THE AMOUNT IN THE TABLE STIPULATED IN SECTION 3 CALCULATED ON SUCH ISSUE, IN SUCH A MANNER AS MAY BE PRESCRIBED. THE SECOND PROVISO DEALS WITH THE CAS ES, WHERE THE MATTER IS BEFORE THE COMMISSIONER (APPEALS) OR BEFORE THE DISPUTE RESOLUTION PANEL. THE THIRD PROVISO DEALS WITH CASES, WHERE THE ISSUE IS PENDING BEFORE THE INCOME TAX APPELLATE TRIBUNAL. THE FILING OF THE DECLARATION IS AS PER SECTION 4 OF THE ACT AND THE PARTICULARS TO BE FURNISHED ARE ALSO MENTIONED IN THE SUB SECTIONS OF SECTION 4. SECTION 5 OF THE ACT DEALS WITH THE TIME AND MANNER OF THE PAYMENT AND SECTION 6 DEALS WITH IMMUNITY FROM INITIATION OF PROCEEDINGS IN RESPECT OF OFFENCE AND I MPOSITION OF PENALTY IN CERTAIN CASES. SECTION 9 OF THE ACT DEALS WITH CASES, WHERE THE ACT 3 OF 2020 WILL NOT BE APPLICABLE. 7. AS OBSERVED, THE ASSESSEE IS GIVEN LIBERTY TO RESTORE THIS APPEAL IN THE EVENT THE ULTIMATE DECISION TO BE TAKEN ON THE DECLA RATION TO BE FILED BY THE ASSESSEE UNDER SECTION 4 OF THE SAID ACT IS NOT IN FAVOUR OF THE ASSESSEE. IF SUCH A PRAYER IS MADE, THE REGISTRY SHALL ENTERTAIN THE PRAYER WITHOUT INSISTING UPON ANY APPLICATION TO BE FILED FOR CONDONATION OF DELAY IN RESTORATIO N OF 4 ITA NO. 2226 / MUM/2019 ASSESSMENT YEAR: 201 5 - 1 6 THE APPEAL AND ON SUCH REQUEST MADE BY THE ASSESSEE BY FILING A MISCELLANEOUS PETITION FOR RESTORATION, THE REGISTRY SHALL PLACE SUCH PETITION BEFORE THE DIVISION BENCH FOR ORDERS. 8. IN THE LIGHT OF THE ABOVE, WE DIRECT THE APPELLANT / ASSESSEE TO F ILE THE FORM NO.I ON OR BEFORE 20.11.2020 AND THE COMPETENT AUTHORITY SHALL PROCESS THE APPLICATION / DECLARATION IN ACCORDANCE WITH THE ACT AND PASS APPROPRIATE ORDERS AS EXPEDITIOUSLY AS POSSIBLE PREFERABLY WITHIN A PERIOD OF SIX (6) WEEKS FROM THE DATE ON WHICH THE DECLARATION IS FILED IN THE PROPER FORM. 5 . IN THE LIGHT OF THE SAID JUDGMENT, THE LD. COUNSEL FURTHER SUBMITTED THAT THE PRESENT APPEAL MAY BE DISPOSED OF IN TERMS OF THE DECISION OF THE HONBLE HIGH COURT. HENCE, RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF M/S. NANNUSAMY MOHAN (HUF) VS. ACIT (SUPRA) , WE DISMISS THE PRESENT APPEAL AS WITHDRAWN . HOWEVER, THE APPELLANT/ASSESSEE IS AT LIBERTY TO FILE MISCELLANEOUS APPLICATION FOR RESTORATION OF APPEAL AS DISCUSSED BY THE HONBLE MADRAS HIGH COURT IN PARAGRAPH 7 OF THE JUDGMENT. IN THE RESULT, APPEAL FILED BY THE ASSESSEE FOR ASSESSMENT YEAR 201 5 - 201 6 IS DISMISSED. ORDER PRONOUNCED ON 23 RD NOVEMBER , 2020 UNDER RULE 34 (4) OF THE INCOME TAX APPE LLATE TRIBUNAL RULES, 1963. SD/ - SD/ - ( SHAMIM YAHYA ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBA I ; DATED: 23 / 1 1 /2020 ALINDRA, PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 5 ITA NO. 2226 / MUM/2019 ASSESSMENT YEAR: 201 5 - 1 6 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI