JT CIT (E)1(1), MUMBAI V. INDIAN MERCHANTS CHAMBER, MUMBAI

ITA 2337/MUM/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7871 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 16-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABI RAMA KARTIKIYEN
• Section: 80G; 12A; 201; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C , MUMBAI BEFORE S HRI G. MANJUNATHA (AM ) AND SHRI RAM LAL NEGI (JM) ITA NO. 2 337 /MUM/2018 ASSESSMENT Y EAR: 2012 - 13 THE DCIT (EXEMPTION) - 1(1), ROOM NO. 506, 5 TH FLOOR, PIRAMAL CHAMBER, LALBAUG, MUMBAI - 400012 VS. M/S INDIAN MERCHANTS CHAMBERS, IMC BUILDING, IMC MARG, CHURCHGATE, MUMBAI - 400012 PAN: AAATD1489N (APPELLANT) (RESPONDENT) REVENUE BY : SHRI ABI RAMA KARTIKIYEN (DR) ASSESSEE BY : MS. SAROJ MANIAR/MS. MRUNMAYEE KAJREKAR (AR S ) DATE OF HEARING: 15/07 /201 9 DATE OF PRONOUNCEMENT: 30 / 0 7 /201 9 O R D E R PER RAM LAL NEGI, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER DATED 09.01.2018 PASSED BY THE COMMISSI ONER OF INCOME TAX (APPEALS) - 1 (FOR SHORT THE CIT(A) , MUMBAI, FOR THE ASSESSMENT YEAR 2012 - 13 , WHEREBY THE LD. CIT(A) HAS PARTLY ALLOWED T HE APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER PASSED U/S 143 (3 ) OF THE INCOME TAX ACT, 1961 (FOR SHOR T THE ACT). 2. THE B RIEF FACTS OF THE CASE ARE THAT THE ASSESSEE TRUST REGISTERED WITH THE DIRECTOR OF INCOME TAX (EXEMPTIONS), MUMBAI U/S 12A AND 80G OF THE ACT FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION DECLARING LOSS OF R S. 36,29,842/ - . THE ASSESSMENT WAS COMPLETED U/S 143 (3) OF THE ACT AND THE AO DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT RS. 3,03,25,280/ - TREATING THE RECEIPTS/ INCOME OF THE TRUST FROM ITS ACTIVITIES AND INTEREST INCOME 2 ITA NO. 2 337 / MUM/2018 ASSESSMENT YEAR: 2012 - 1 3 ON THE PRINCIPLES OF MUTUALIT Y. THE ASSESSEE CHALLENGED THE ASSESSMENT ORDER BEFORE THE LD. CIT (A). THE LD. CIT (A) AFTER HEARING THE ASSESSEE, PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE AND DIRECTED THE AO TO ALLOW EXEMPTION U/S 11 OF THE ACT BY FOLLOWING THE DECISION OF THE IT AT, MUMBAI RENDERED IN THE ASSESSEES OWN CASE FOR THE AY 2009 - 10 , 2010 - 11 AND 2011 - 12 . THE REVENUE IS IN APPEAL AGAINST THE SAID FINDINGS OF THE LD. CIT (A). 3 . THE REVENUE HAS CHALLENGED THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) ON THE FOLLOWING EFFE CTIVE GROUNDS : - 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD . CIT(A) IS ERRED BY FOLLOWING THE DECISIONS OF HONBLE ITAT IN WHICH THE HONBLE ITAT HELD THAT THE ASSESSEE IS A CHARITABLE ORGANIZATION AND IS ELIGIBLE FOR DEDUC TION U/S 11 OF THE IT ACT 1961. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD . CIT(A) IS ERRED BY FOLLOWING THE DECISIONS OF HONBLE ITAT IN WHICH THE HONBLE ITAT ALLOWED THE ASSESSEE BENEFITS OF SECTION 11 OF THE ACT WITHOUT AP PRECIATING THE FACT THAT THE ACTIVITIES OF THE ASSESSEE DO NOT FIT INTO THE CHARACTER OF EDUCATION AS DEFINED BY HONBLE SUPREME COURT IN THE CASE OF SOLE TRUSTEE LOKA SHIKSHANA TRUST AND BY HONBLE PATNA HIGH COURT IN THE CASE OF BIHAR INSTITUTE OF MINING AND MINE SURVEYING. 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD . CIT(A) IS ERRED BY FOLLOWING THE DECISIONS OF HONBLE ITAT IN WHICH THE HONBLE ITAT ALLOWED THE ASSESSEES APPEAL IGNORING THE RATIO LAID DOWN BY HONBLE SUPREME COURT IN THE CASE OF SOLE TRUSTEE LOKA SKIKSHANA TRUST AND BY HONBLE PATNA HIGH COURT IN THE CASE OF BIHAR INSTITUTE OF MINING AND MINE SURVEYING. 4. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD . CIT(A) IS ERRED BY FOLLOWING THE D ECISIONS OF HONBLE ITAT IN WHICH THE HONBLE ITAT ALLOWED THE ASSESSEES APPEAL WITHOUT APPRECIATING THE COMMERCIAL NATURE OF THE ACTIVITIES OF THE TRUST WHICH DO NOT CONSTITUTE EDUCATION. 3 ITA NO. 2 337 / MUM/2018 ASSESSMENT YEAR: 2012 - 1 3 4. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED TH AT THE ISSUE RAISED BY THE REVENUE HAS ALREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE ITAT MUMBAI IN ASSESSEES OWN CASE FOR THE AY 2009 - 10 2010 - 11 AND 2011 - 12. THE LD. COUNSEL FURTHER SUBMITTED THAT SINCE THE ORDER PASSED BY THE LD. CIT (A) IN THE PRESENT CASE IS IN ACCORDANCE WITH THE FINDINGS OF THE ITAT, MUMBAI, THERE IS NO INFIRMITY IN THE ORDER OF THE LD. CIT (A) TO INTERFERE WITH. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE (DR) ADMITTED THAT THE ITAT HAS DECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE IN ASSESSEES OWN CASE FOR THE AY 2009 - 10 , 2010 - 11 AND 2011 - 12. HOWEVER, THE LD. DR SUPPORTED THE ASSESSMENT ORDER. 5. WE HAVE PERUSED THE MATERIAL ON RECORD IN THE LIGHT OF THE RIVAL SUBMISSIONS OF THE PARTIES. THE ONLY GRIEVANCE IS THE REVENUE IS THAT LD.CIT (A) HAS WRONGLY ALLOWED DEDUCTION U/S 11 OF THE ACT TO THE ASSESSEE COMPANY BY FOLLOWING THE DECISION OF THE ITAT, MUMBAI RENDERED IN ASSESSEES OWN CASE FOR THE EARLIER ASSESSMENT YEARS. AS POINTED OUT BY THE LD. COUNSEL FOR THE ASSESSEE, THE COORDINATE BENCH HAS ALREADY DECIDED THIS ISSUE IN FAVOUR OF THE ASSESSEE IN THE ASSESSEES OWN CASE FOR THE AY 2009 - 10. THE LD. CIT (A) HAS DECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING THE DECISION OF THE COORDINATE BENCH RENDERED IN THE ASSESSEES OWN CASE FOR THE AY 2009 - 10. THE OPERATIVE PART OF THE ORDER OF THE COORDINATE BENCH READS AS UNDER: - 6.FACTS AND CIRCUMSTANCES IN THE INSTANCE CASE BEFORE US ARE EXACTLY SIMILAR VIS - - VIS NATURE OF ACTIVITY BEING CARRIE D OUT BY THE ASSESSEE RESPECTFULLY FOLLOWING THE DECISION OF CO - ORDINATE BENCH IN THE CASE OF INDIAN CHAMBER OF COMMERCE & INDUSTRY, WHEREIN AFTER DISCUSSING VARIOUS HIGH COURT AND SUPREME COURT JUDGMENT THE TRIBUNAL REACHED TO THE CONCLUSION THAT EVEN OF AMENDMENT OF SECTION 2(15) OF THE ACT W.E.F. 01.04.2009, ASSESSEE ASSOCIATIONS HAVING PRIMARY PURPOSE OF ADVANCEMENT OF OBJECTS OF GENERAL PUBLIC UTILITY AND IT WOULD REMAIN CHARITABLE EVEN IF AN INCIDENTAL OR ANCILLARY ACTIVITY OR PURPOSE FOR ACHIEVING T HE MAIN PURPOSE WAS 4 ITA NO. 2 337 / MUM/2018 ASSESSMENT YEAR: 2012 - 1 3 PROFITABLE IN NATURE. HENCE, ASSESSEE IS NO HIT BY NEWLY INSERTED PROVISO TO SECTION 2(15) OF THE ACT. 6. FURTHER, THE COORDINATE BENCH HAS ALLOWED THE DEDUCTION U/S 11 OF THE ACT TO THE ASSESSEE TRUST IN ITS APPEAL ITA NO. 1684/MUM/2 017 FOR THE ASSESSMENT YEAR 2010 - 11 BY FOLLOWING THE DECISION OF THE COORDINATE BENCH RENDERED IN THE ASSESSEES OWN CASE FOR THE AY 2009 - 10 AFORESAID. WE FURTHER NOTICE THAT THE COORDINATE BENCH HAS ALLOWED DEDUCTION U/S 11 TO THE ASSESSEE IN ASSESSEES A PPEAL FOR THE AY 2011 - 12 BY FOLLOWING THE DECISION OF THE COORDINATE BENCHES RENDERED IN THE ASSESSEES OWN CASES DISCUSSED ABOVE . SINCE, THIS ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE CO - ORDINATE BENCH IN ASSESSEES OWN CASE AND SINCE THE RE VENUE HAS NOT BROUGHT TO OUR NOTICE ANY MATERIAL CHANGE IN THE FACTS OF THE PRESENT CASE, WE RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH E S DISCUSSED AB OVE, DISMISS ALL THE GROUND OF APPEAL OF THE REVENUE AND DIRECT THE AO TO DELETE THE ADDI TION. IN THE RESULT, APPEAL FILED BY THE REVENUE FOR ASSESSMENT YEAR 2012 - 2013 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH J ULY , 2019 . SD/ - SD/ - ( G. MANJUNATHA ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 30 / 07 / 201 9 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. 2 337 / MUM/2018 ASSESSMENT YEAR: 2012 - 1 3 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI