The Dy. Commissioner of Incometax, Jammu V. M/s. J&K Small Scale Industries, Jammu

ITA 226/ASR/2014

• Counselvise Citation: 22620914 RSA 2014
• Duration Of Justice: 1 year(s) 8 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 30-11-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 07-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R K SHARDA
• Keywords: Retrospective amendment
• Section: 12AA; 63; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR (JAMMU CAMP, JAMMU) BEFORE SH. A.D.JAIN, HONBLE JUDICIAL MEMBER AND SH. T.S.KAPOOR, HONBLE ACCOUNTANT MEMBER I.T.A NO.183 (ASR)/2014 ASSESSMENT YEAR: 2007-08 J&K SMALL SCALE INDUSTRIES DEV. COR. LTD., 2 ND FLOOR, J.L. NEHRU UDYOG BHAWAN, RAIL HEAD COMPLES, JAMMU. PAN: AAATJ0676M VS. THE DCIT, CIRCLE-1, JAMMU. (APPELLANT) (RESPONDENT) I.T.A NO. 226 (ASR)/2014 ASSESSMENT YEAR: 2007-08 THE DCIT, CIRCLE-1 JAMMU. VS. J&K SMALL SCALE INDUSTRIES DEV. CORPORATION AQUAF COMPLEX, GANDHI NAGAR JAMMU. PAN: AAATJ0676M (APPELLANT) (RESPONDENT) I.T.A NO. 227 (ASR)/2014 ASSESSMENT YEAR: 2009-10 THE DCIT, CIRCLE-1 JAMMU. VS. J&K SMALL SCALE INDUSTRIES DEV. CORPORATION AQUAF COMPLEX, GANDHI NAGAR JAMMU. PAN: AAATJ0676M (APPELLANT) (RESPONDENT) 2. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 I.T.A NO. 727 (ASR)/2014 ASSESSMENT YEAR: 2008-09 J&K SMALL SCALE INDUSTRIES DEV. CORPORATION AQUAF COMPLEX, GANDHI NAGAR JAMMU. PAN: AAATJ0676M VS. THE DCIT, CIRCLE-1 JAMMU. (APPELLANT) (RESPONDENT) I.T.A NO. 728 (ASR)/2014 ASSESSMENT YEAR: 2008-09 THE DCIT, CIRCLE-1 JAMMU. VS. J&K SMALL SCALE INDUSTRIES DEV. CORPORATION AQUAF COMPLEX, GANDHI NAGAR JAMMU. PAN: AAATJ0676M (APPELLANT) (RESPONDENT) APPELLANT BY: SH. R.K. GUPTA (CA.) RESPONDENT BY: SH. R.K. SHARDA (DR.) DATE OF HEARING: 02.12.2015 DATE OF PRONOUNCEM ENT: 31.12.2015 ORDER PER T.S.KAPOOR (A.M): THIS IS BUNCH OF FIVE APPEALS OUT OF WHICH THREE APPEALS HAVE BEEN FILED BY THE ASSESSEE WHEREAS TWO APPEALS HAVE BEEN FILED BY THE REVENUE. THE GROUNDS OF APPEAL TAKEN BY THE ASSESSEE IN ASST. YE AR 2007-08 AND 2008-09 3. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 ARE SIMILAR. FOR THE SAKE OF CONVENIENCE, THE GROUN DS OF APPEAL IN ITA NO. 183(ASR)/2014 ARE REPRODUCED BELOW. THE ORDER PASSED BY CIT(A) IS ERRONEOUS IN LAW, PR EJUDICIAL, ARBITRARY AND NOT IN KEEPING WITH FACTS AND RECORDS OF THE CASE. (I) THE WORTHY CIT(A) IS NOT JUSTIFIED IN CONFIRMIN G ACTION OF THE LD. ASSESSING OFFICER FOR ASSESSING THE APPELLANT TRUST IN THE STATUS OF COMPANY AS IT IS REGISTERED UNDER SEC. 12AA OF THE INCOME TAX ACT, 1961. (II) THE WORTHY CIT(A) IS NOT JUSTIFIED IN CONFIRMI NG THE ACTION OF LD. A.O FOR DENYING EXEMPTION AVAILABLE UNDER SEC. 11 OF THE IN COME TAX ACT,1961. 2. THE GROUNDS OF APPEAL TAKEN BY REVENUE IN ASST. YEAR 2007-08 AND 2008- 09 AND 2009-10 ARE ALSO SIMILAR EXCEPT AN ADDITIONA L GROUND REGARDING LEVY OF FBT IN ASST. YEAR 2008-09 IN ITA NO. 728(ASR)/2014. FOR THE SAKE OF CONVENIENCE THE GROUNDS OF APPEAL TAKEN BY THE REVE NUE IN ITA NO. 728(ASR)/2014 ARE REPRODUCED BELOW. (1) WHETHER THE COMMISSIONER OF INCOME TAX (APPEA LS), JAMMU WAS RIGHT IN DELETING THE ADDITION MADE ON ACCOUNT OF AMORTIZ ATION OF LEASE PREMIUM OF LAND. AS THE ASSESSEE WAS REQUIRED TO SHOW THE L EASE MONEY AS INCOME IN VIEW OF THE ACCOUNTING STANDARD 19 (AS 19) ISSUE D BY THE INSTITUTE OF THE CHARTERED ACCOUNTANTS OF INDIA WHICH CLEARLY SP ECIFIES THE LEASE PREMIUM IS REQUIRED TO BE ACCOUNT FOR IN P&L ACCOUN T IN EQUAL INSTALMENTS OVER THE PERIOD OF LEASE. (2) WHETHER THE COMMISSIONER OF INCOME TAX (APPEALS ), JAMMU WAS RIGHT IN DELETING THE DEMAND RAISED BY APPLYING PROVISION S OF FRINGE BENEFIT TAX AS THE ASSESSEE IS NOT ENTITLED FOR EXEMPTION U/S 1 1AS PER SECTION 60 TO 63 AS HAS BEEN HELD BY THE ASSESSING OFFICER. 3. AT THE OUTSET, THE LEARNED AR FIRST TOOK UP APPEAL IN ITA NO. 183 FOR ASST. YEAR 2007-08. REGARDING THE FIRST GROUND OF APPEAL THE LEARNED AR SUBMITTED 4. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 THAT THE LEARNED ASSESSING OFFICER WAS WRONG IN ASS ESSING THE INCOME OF ASSESSEE IN THE STATUS OF A COMPANY INSTEAD OF AS A TRUST U/S 12AA OF THE ACT AND IN THIS RESPECT INVITED OUR ATTENTION TO PAPER BOOK PAGE-1 WHERE AN ORDER PASSED BY COMMISSIONER OF INCOME TAX, JAMMU GRANTIN G ASSESSEE REGISTRATION U/S 12AA WAS PLACED. WITHOUT PREJUDICE TO THE ABOVE THE LEARNED AR SUBMITTED THAT FOR ASST. YEARS 1980-81 TO 1986-87 AND 1990-91 THE ASSESSING OFFICER HIMSELF, IN VIEW OF THE ORDER OF HONBLE ITAT IN RE SPECT OF APPEAL NO.247 TO 254 HAS GIVEN EFFECT TO ASSESSMENT ORDERS AND HAS ASSES SED THE ASSESSEE AS TRUST AND OUR ATTENTION WAS INVITED TO PAPER BOOK PAGE 1 TO 7 WHERE SUCH CONSEQUENTIAL ORDERS WERE PLACED. THEREFORE, IN VI EW OF THE ABOVE, THE LEARNED AR SUBMITTED THAT THE ACTION OF ASSESSING OFFICER I N ASSESSING THE ASSESSEE AS A COMPANY IS NOT JUSTIFIED. FURTHER INVITING OUR AT TENTION TO ASSESSMENT ORDER PASSED BY ASSESSING OFFICER IN RESPECT OF ASST. YEA R 2004-05, 2005-06 AND 2006-07, HE SUBMITTED THAT IN RESPECT OF THESE YEAR S ALSO THE ASSESSEE HAS BEEN ASSESSED AS TRUST. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, IT WAS SUBMITTED THAT THE ASSESSEE NEEDS TO BE ASSESSED AS A TRUST. COMING TO GROUND NO.2 OF THE APPEAL, THE LEARNED AR SUBMITTED THAT B OTH AUTHORITIES BELOW HAS MISUNDERSTOOD THE FINDINGS OF AMRITSAR BENCH OF TRI BUNAL IN ITA NO. 247 TO 254, WHEREIN THE TRIBUNAL HAS HELD THAT EXEMPTION U /S 11 CANNOT BE GIVEN TO THE ASSESSEE RETROSPECTIVELY AND IT CAN BE ALLOWED ONLY ON PROSPECTIVE BASIS. IN THIS RESPECT, LEARNED AR TOOK US TO THE ARGUMENTS O F THE LEARNED DR AS CONTAINED IN PARA 12 OF SAID TRIBUNAL ORDER. IN VIE W OF THE ARGUMENTS ADVANCED BY LEARNED DR AND RECORDED IN THE TRIBUNAL ORDER TH E LEARNED AR SUBMITTED 5. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 THAT DEPARTMENT ITSELF HAD ARGUED THAT THE ASSESSEE WOULD BE ELIGIBLE FOR EXEMPTION FROM ASST. YEAR 2007-08 ONWARDS AND WILL NOT BE ELIGIBLE FOR EXEMPTION FOR EARLIER YEARS. EXPLAINING THE FACTS O F THE CASE THE LEARNED AR SUBMITTED THAT THE ASSESSEE WAS A TRUST HOWEVER THE ARTICLES OF ASSOCIATION OF TRUST CONTAINED CERTAIN CLAUSES REGARDING DECLARATI ON OF DIVIDENDS AND THEREFORE ASSESSING OFFICER HAD DENIED EXEMPTION U/ S 11 AND AFTER THAT ASSESSEE HAD AMENDED SUCH ARTICLES ON 17.04.2006 WI TH RETROSPECTIVE EFFECT AND THEREFORE LEARNED CIT(A) IN ASST. YEAR 1980-81 TO 1986-87 AND 1990-91 HAD GIVEN EXEMPTION U/S 11 BUT HONBLE TRIBUNAL VID E ITS ORDER DATED 08.02.2008 HAD HELD THAT SINCE THE ASSESSEE HAD AME NDED ITS ARTICLES ON 17.04.2006, THE ASSESSEE WAS NOT ELIGIBLE FOR EXEMP TION FOR EARLIER YEARS. THE LEARNED AR POINTED OUT THAT THE PRESENT APPEALS FIL ED BY ASSESSEE RELATES TO ASST. YEAR 2007-08 AND 2008-09 AND THEREFORE, THE E XEMPTION U/S 11 SHOULD BE AVAILABLE TO ASSESSEE, IN VIEW OF THE HONBLE SU PREME COURT DECISION IN THE CASE OF CIT VS DELHI STOCK EXCHANGE ASSOCIATION LTD . 225 ITR 235 WHEREIN THE HONBLE SUPREME COURT HAD CONCLUDED THAT SO LONG AS THERE WAS NO PROHIBITION ON THE ASSESSEE STOCK EXCHANGE UNDER ITS ARTICLES O F ASSOCIATION FROM DISTRIBUTING THE WHOLE OR PART OF ITS INCOME BY WAY OF DIVIDENDS, IT WAS NOT ENTITLED TO EXPLANATION U/S 11. THE LEARNED AR SUBM ITTED THAT ASSESSEE ON 17.04.2006 HAD AMENDED ITS ARTICLES AND NOW THERE I S COMPLETE PROHIBITION OF DISTRIBUTION OF DIVIDENDS AND THEREFORE IN THESE YE ARS THE ASSESSEE WAS ENTITLED FOR EXEMPTION. 6. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 4. THE LEARNED DR, HOWEVER, HEAVILY RELIED UPON THE AUTHORITIES BELOW, IN RESPECT OF ASSESSEES APPEALS AND RELIED UPON ASSES SMENT ORDERS IN RESPECT OF REVENUES APPEALS. 5. AS REGARDS THE REVENUES APPEALS THE LEARNED AR RELIED UPON THE ORDER OF LEARNED CIT(A). 6. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. THE APPEALS WERE ORIGINALLY HEARD ON 30.11.2015, HOWEVER, DUE TO CERTAIN CLARIFICATIONS THE APPEALS WERE FIXE D FOR REHEARING AND FINALLY THE APPEALS WERE HEARD ON 2.12.2015. 7. WE FIRST TAKE UP THE APPEALS FILED BY THE ASSESS EE. THERE ARE COMMON ISSUES IN THE APPEALS FILED BY ASSESSEE ONE OF BEIN G ITS GRIEVANCE THAT ASSESSING OFFICER SHOULD HAVE ASSESSED THE ASSESSEE AS A TRUS T IN VIEW OF THE FACT THAT IN EARLIER YEARS THE ASSESSING OFFICER HIMSELF HAD PAS SED A CONSEQUENTIAL ORDERS TREATING THE ASSESSEE AS A TRUST. WE FIND THAT ASSE SSING OFFICER VIDE ORDERS DATED 08.02.2008 PASSED FOR ASST. YEARS 1980-81, 19 82-83, 1983-84, 1984-85, 1985-86, 1986-87 AND 1990-91 HAS ACCEPTED THE STATU S OF THE ASSESSEE AS A COMPANY ASSESSED AS TRUST. THE SAID ORDERS WERE PAS SED IN VIEW OF THE ORDERS OF TRIBUNAL, AMRITSAR BENCH IN ITA NO. 247 TO 254. THE SAID ORDERS ARE PLACED IN PAPER BOOK PAGE 1 TO 7. WE FIND THAT FOR ASST. Y EAR 2004-05, 2005-06 AND 2006-07, THE ASSESSING OFFICER HAS ASSESSED THE ASS ESSEE AS COMPANY ASSESSED AS TRUST. FURTHERMORE, WE FIND THAT ASSESSEE HAS B EEN GRANTED REGISTRATION U/S 7. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 12AA VIDE ORDER DATED 28.02.2003 AND THE ASSESSEE H AS BEEN REGISTERED U/S 12AA W.E.F 1.4.1979 AND THE SAID ORDER HAD NOT BEEN WITHDRAWN NOR THE LEARNED DR WAS ABLE TO DEMONSTRATE THAT SAID ORDER WAS NOT EXISTING AS ON THE DATE. THEREFORE, KEEPING IN VIEW ALL THE FACTS AND CIRCUMSTANCES, WE DIRECT THE ASSESSING OFFICER TO ASSESS THE ASSESSEE IN THE STA TUS OF COMPANY ASSESSED AS A TRUST. IN VIEW OF THE ABOVE GROUND NO. 1 OF THE APP EALS FILED BY THE ASSESSEE IS ALLOWED. 8. AS REGARDS GROUND NO.2, WE FIND THAT ASSES SEES CLAIM U/S 11 WAS DENIED IN VIEW OF THE ORDER OF TRIBUNAL DATED 08.02.2008 F OR ASST. YEAR 1980-81 TO 1986 AND 87 AND 1990-91 IN ITA NO.247 AND 254. IN T HE SAID TRIBUNAL ORDER, THE TRIBUNAL HAS REVERSED THE ORDER OF CIT(A) AND H AS HELD THAT EXEMPTION U/S 11 CANNOT BE ALLOWED TO ASSESSEE AS THE AMENDMENT M ADE BY ASSESSEE IN ITS ARTICLES OF ASSOCIATION ON 14.06.2006 CANNOT BE SAI D TO HAVE EFFECT RETROSPECTIVELY. THE ASSESSEE HAD CARRIED OUT AMEND MENT IN ITS ARTICLES OF ASSOCIATION ON 14.06.2007 AND THE CLAIM OF ASSESSEE IS THAT SINCE THE PRESENT APPEALS RELATES TO ASST. YEAR 2007-08 AND 2008-09, THEREFORE, KEEPING IN VIEW THE JUDGMENT OF DELHI STOCK EXCHANGE (SUPRA) THE AS SESSEE SHOULD HAVE BEEN ALLOWED EXEMPTION U/S 11 FOR THESE YEARS. DURING RE HEARING OF THE CASES THE LEARNED AR WAS ASKED AS TO WHAT HAD HAPPENED TO THE CASES OF DELHI STOCK EXCHANGE FOR SUBSEQUENT YEARS FROM 1974-75 ONWARDS. IN REPLY TO WHICH LEARNED AR FILED A COPY OF DELHI HIGH COURTS ORDER IN THE CASE OF DELHI STOCK EXCHANGE (SUPRA) AND SUBMITTED THAT IN ASST. YEAR 1 974-75 THE STOCK 8. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 EXCHANGE HAS BEEN ALLOWED EXEMPTION. THE BRIEF FACT S OF DELHI STOCK EXCHANGE ARE THAT IT HAD BEEN DISALLOWED EXEMPTION U/S 11 AS ITS ARTICLES DID NOT CONTAIN ANY RESTRICTION FOR DISTRIBUTION OF DIVIDEND; THERE FORE, THE STOCK EXCHANGE AMENDED ITS ARTICLES FOR ASST. YEAR 1973 AND THE HO NBLE SUPREME COURT FOR ASST. YEAR 1966 TO 1969-70 HELD THAT SINCE, THERE W AS NO PROHIBITION ON THE ASSESSEES STOCK EXCHANGE UNDER ITS ARTICLES OF ASS OCIATION FROM DISTRIBUTION THE WHOLE OR PART OF ITS INCOME BY WAY OF DIVIDEND, IT WAS NOT ENTITLED TO EXEMPTION U/S 11. THE SAID ORDER OF HONBLE SUPREME COURT IMP LIES THAT WHEN THERE ARE RESTRICTIONS FOR DISTRIBUTION OF DIVIDEND THE ASSES SEE IS ELIGIBLE FOR EXEMPTION U/S 11 AND IN THIS VIEW OF THE FACTS, THE LEARNED A R WAS ASKED TO ASCERTAIN THE STATUS OF ASSESSMENTS OF DELHI STOCK EXCHANGE ASSOC IATION AFTER IT AMENDED THE ARTICLES WHICH WAS AMENDED IN ASST. YEAR 1973 A ND IN VIEW OF OUR ASKING THE LEARNED AR HAD FILED A CASE LAW OF CIT VS. DELH I STOCK EXCHANGE (SUPRA) FOR ASS. YEAR 1974-75 WHEREIN THE HONBLE DELHI HIGH CO URT HAD HELD THAT THOUGH THE ASSESSEE HAD AMENDED ITS ARTICLES OF ITS ASSOCI ATION IN THE MIDST OF RELEVANT PREVIOUS YEARS WHEREBY, DISTRIBUTION OF PROFITS BY WAY OF DIVIDEND OR INTEREST WAS PROHIBITED EXEMPTION U/S 11 HAD TO BE ALLOWED F OR THE WHOLE OF THE ASSESSMENT YEAR IRRESPECTIVE OF THE FACT THAT THE A MENDMENT WAS CARRIED OUT IN THE MIDST OF PREVIOUS YEAR. THE RELEVANT FINDINGS O F THE HONBLE COURT AS REPRODUCED IN PARA 7 OF THE SAID ORDER IS REPRODUCE D BELOW. 7. IN THE INSTANT CASE, AS NOTICED ABOVE, EXEMPTI ON UNDER S.11 WAS DISALLOWED IN THE PAST AND IN THE PRESENT YEAR ONLY ON THE GROUND THAT THE ARTICLES OF ASSOCIATION DO NOT EXPRESSLY PROHIBIT D ECLARATION OF DIVIDEND, ETC. TO THE SHAREHOLDERS AND NOT FOR ANY OTHER REAS ON. IN OUR OPINION, THE FLAW IN THE MEMORANDUM AND ARTICLES OF ASSOCIATION WHICH, ACCORDING TO THE REVENUE, DISENTITLED THE ASSESSEE FOR CLAIM UND ER S.11, HAVING BEEN 9. ITA NOS.1 83, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 RECTIFIED DURING THE PREVIOUS YEAR RELEVANT TO THE ASST. YR. 1974-75, THE EXEMPTION UNDER S. 11, OF THE ACT HAS TO BE ALLOWED FOR THE WHOLE OF THE ASSESSMENT YEAR IRRESPECTIVE OF THE FACT THAT THE A MENDMENT TOOK PLACE IN THE MIDST OF THE PREVIOUS YEAR. WE ARE OF THE VIEW THAT AFTER THE SAID AMENDMENT HAD BEEN CARRIED OUT IN DECEMBER, 1973 TH E DECISIONS OF THE TRIBUNAL IN RESPECT OF EARLIER ASSESSMENT YEARS COU LD NOT BE APPLIED IN RESPECT OF THE PRESENT ASSESSMENT YEAR. WE ARE, THE REFORE, IN AGREEMENT WITH THE TRIBUNAL THAT THE INCOME OF THE ASSESSEE F OR THE WHOLE OF THE PREVIOUS YEAR RELEVANT TO THE ASST. YR. 1974-75 IS ENTITLED TO EXEMPTION UNDER S. 11 OF THE ACT. WE ACCORDINGLY ANSWER THE Q UESTION REFERRED IN THE AFFIRMATIVE I.E., IN FAVOUR OF THE ASSESSEE AND AGA INST THE REVENUE. THERE WILL, HOWEVER, BE NO ORDER AS TO COSTS. IN THE CASE OF ASSESSEE, THE ASSESSEE HAD BEEN RIGH TLY DISALLOWED THE EXEMPTION U/S 11 FOR THE PREVIOUS YEARS PRIOR TO THE DATE OF AMENDMENT AND THE ASSESSEE HAD CARRIED OUT NECESSARY AMENDMENT IN ITS ARTICLES ON 14.6.2006 WHICH IS RELEVANT FOR ASST. YEAR 2007-08 ONWARDS. THE PRESEN T APPEALS OF THE ASSESSEE RELATES TO THE ASST. YEAR 2007-08 AND 2008-09 AND T HEREFORE, KEEPING IN VIEW THE RATIO OF THE SUPREME COURT DECISIONS IN THE CAS E OF DELHI STOCK EXCHANGE(SUPRA) AND HONBLE DELHI HIGH COURT IN THE CASE OF DELHI STOCK EXCHANGE THE ASSESSEE IS ELIGIBLE FOR EXEMPTION U/S 11 FOR THE PRESENT YEARS AS IN THE PRESENT YEARS THE ARTICLES OF ASSOCIATION ST OOD AMENDED. IN VIEW OF THE ABOVE GROUND NO.2 OF THE APPEALS IS ALSO ALLOWED. 9. IN NUTSHELL THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. 10. NOW COMING TO THE APPEALS FILED BY THE REVEN UE, WE FIND THAT THE COMMON ISSUE RAISED IN THREE APPEALS IS THE ACTION OF LEARNED CIT(A) BY WHICH HE HAD ALLOWED RELIEF ON ACCOUNT OF AMORTIZATION OF LEASE PREMIUM ON LAND AND THE SECOND ISSUE IS LEVY OF FBT WHICH HAS BEEN RAIS ED ONLY IN ASST. YEAR 2008- 09. AS REGARDS AMORTIZATION OF LEASE PREMIUM ON LA ND, WE FIND THAT DURING THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER HAD OB SERVED THAT THE ASSESSEE 10. ITA NOS. 183, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 HAD RECEIVED PREMIUM ON LAND WHICH THE ASSESSEE HAD NOT DECLARED AS ITS INCOME, THEREFORE, ASSESSEE WAS REQUIRED TO EXPLAIN THE SAME. THE ASSESSEE EXPLAINED THAT THE ASSESSEE IS ENTRUSTED WITH THE J OB OF PROVIDING THE REQUIREMENT OF LAND ON LEASE HOLD BASIS TO THE ENTR EPRENEURS AND PREMIUM RECEIVED ON LAND ALLOTMENT ON THESE LANDS BELONGED TO STATE GOVERNMENT AS THE LAND ITSELF BELONGED TO STATE GOVERNMENT. IT WAS FU RTHER SUBMITTED THAT THE AGENCY WAS ONLY IMPLEMENTING THE DEVELOPMENT AND ES TABLISHMENT OF INDUSTRIAL UNITS IN THE STATE AND THE LAND PREMIUM WOULD BE PAID BACK TO STATE GOVERNMENT AS AND ONE IT IS REQUIRED TO DO SO. IT W AS FURTHER EXPLAINED THAT BECAUSE OF THIS FACT THE LAND ALLOTMENT PREMIUM HAS BEEN REFLECTED IN THE BALANCE SHEET AS A LIABILITY. THE ASSESSING OFFICER , HOWEVER DID NOT AGREE WITH THE CONTENTIONS OF ASSESSEE AND HELD THAT ASSESSEE WAS REQUIRED TO DECLARE THE INCOME ON ACCOUNT OF AMORTIZATION ON LEASE PREMIUM, IN VIEW OF ACCOUNTING STANDARD (AS19) ISSUED BY ICAI AND THEREFORE, MADE THE ADDITIONS. THE LEARNED CIT(A) , HOWEVER, ALLOWED THE RELIEF TO THE ASSESSE E HOLDING THAT ASSESSEE WAS NOT OWNER OF THE LAND AND THE LEASE PREMIUM WAS COL LECTED ON BEHALF OF THE STATE GOVERNMENT. WE FIND THAT THE LEARNED CIT(A) H AS MADE A FINDING OF FACT THAT AUDITED ACCOUNTS OF ASSESSEE DOES NOT CONTAIN ANY ADVERSE COMMENTS ON THE CLASSIFICATION OF LAND PREMIUM AS LIABILITY THE REFORE, THE ASSESSEE HAD RIGHTLY REFLECTED THE SAME IN THE BALANCE SHEET. TH E LEARNED CIT(A) HAS ALSO HELD THAT THE CASES OF THE ASSESSEE WERE DISTINGUIS HABLE FROM THE CASE OF JAMMU DEVELOPMENT AUTHORITY, WHEREIN, HE HAD HELD T HE LAND PREMIUM AS INCOME OF JAMMU DEVELOPMENT AUTHORITY. THE LEARNED DR COULD NOT CONTROVERT 11. ITA NOS. 183, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 ANY OF THE FINDINGS OF LEARNED CIT(A). WE FIND THAT ASSESSEE HAD RIGHTLY CLASSIFIED THE LAND PREMIUM AS A LIABILITY AS THE L AND PREMIUM WAS COLLECTED ON BEHALF OF THE STATE GOVERNMENT AND CANNOT BE CLASSI FIED AS INCOME OF THE ASSESSEE. IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LEARNED CIT(A), THEREFORE, GROUND NO.1 & 2 IN ASST. YEAR 2006-07 AND 2007-08 ARE DISMISSED WHEREAS, THE GROUND NO.1 IN ASST. YEA R 2008-09 IS ALSO DISMISSED. 11. AS REGARDS GROUND NO.2 IN ASST. YEAR 2008-09 , WE FIND THAT THAT THERE IS NO DISPUTE THAT ASSESSEE IS REGISTERED U/S 12AA OF THE INCOME TAX ACT. THEREFORE, THE PROVISIONS OF SECTION 115WA ARE NOT APPLICABLE TO A COMPANY REGISTERED U/S 12AA OF THE ACT AND IN VIEW OF THIS NO FBT WAS LEVIABLE. WE HAVE ALREADY HELD THAT ASSESSEE IS TO BE TAXED IN THE ST ATUS OF COMPANY REGISTERED AS TRUST. IN VIEW OF THE ABOVE PROVISIONS OF FBT ARE N OT APPLICABLE TO THE ASSESSEE AND THEREFORE, GROUND NO.2 IN ASST. YEAR 2008-09 IS ALSO DISMISSED. IN VIEW OF THE ABOVE, THE APPEALS FILED BY THE REVENUE ARE DIS MISSED. 12. IN NUTSHELL, THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED WHEREAS THE APPEALS FILED BY REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST DECEMBER, 2015. SD/- SD/- (A.D.JAIN) (T.S.KAPOOR) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED:31.12.2015 PK/PS 12. ITA NOS. 183, 226, 227, 727, 728 (ASR)/2014 ASST. YEARS 20 07-08, 2009-10 & 2008-09 COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: 2. THE 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.