Agricultural Marcket Committiee., Tadepallegudem V. THE ITO, Tadepallegudem

ITA 237/VIZ/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 6440 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 2 year(s) 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2003-2004
• Appeal Filed On: 06-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D J P ANAND
• Keywords: Additional evidence
• Section: 12AA; 11; 15

Judgement Text

ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . [ , . . , BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./I.T.A.NO.237/VIZAG/2015 ( [ [ / ASSESSMENT YEAR: 2003-04) AGRICULTURAL MARKET COMMITTEE TADEPALLIGUDEM ITO, WARD - 1, TADEPALLIGUDEM [PAN NO.AAALA0358D] ( / APPELLANT) ( / RESPONDENT) ./I.T.A.NO.238/VIZAG/2015 ( [ [ / ASSESSMENT YEAR: 2003-04) AGRICULTURAL MARKET COMMITTEE ACHANTA ITO, WARD-1, PALAKOL [PAN NO.AAALA0387L] ( / APPELLANT) ( / RESPONDENT) ./I.T.A.NO.239/VIZAG/2015 ( [ [ / ASSESSMENT YEAR: 2003-04) AGRICULTURAL MARKET COMMITTEE NARASAPURAM ITO, WARD - 1, PALAKOL [PAN NO.AAALA0387L] ( / APPELLANT) ( / RESPONDENT) ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 2 ./I.T.A.NO.253&254/VIZAG/2015 ( [ [ / ASSESSMENT YEAR: 2003-04 & 2004-05) AGRICULTURAL MARKET COMMITTEE PALAKOL ITO, WARD - 1, PALAKOL [PAN NO.AAALA0440J] ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI G.V.N. HARI, AR / RESPONDENT BY : SHRI D.J.P. ANAND, DR / DATE OF HEARING : 29.11.2017 / DATE OF PRONOUNCEMENT : 20.12.2017 / O R D E R PER BENCH: THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDERS OF COMMISSIONER OF INCOME TAX (APPEALS) {CIT(A)},RAJAHMUNDRY DATED 19.3.2015. SINCE, THE FACTS ARE IDENTICAL AND ISSUES ARE COMMON, THEY ARE CLUBBED, HEARD TOGETHER AND DISPOSED-OFF BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE ASSESSEES ARE ESTABLISHED UNDER THE A.P. (AGRICULTURAL PRODUCE & LIVE STOCK) MARKETS ACT, 1966 AND GRANTED REGISTRATION U/S 12AA OF THE ACT W.E.F. 26.7.1993. THE ASSESSEES HAVE CLAIMED THE EXEMPTION U/S 11 OF THE ACT AND THE A.O. HELD THAT THE ASSESSEES ARE NOT ENTITLED FOR EXEMPTION U/S 11 FOR VIOLATION OF PROVISIONS OF SECTION ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 3 11(5) OF THE ACT. THE A.O. REFUSED THE EXEMPTION U/S 11 OF THE ACT AND BROUGHT TO TAX THE ENTIRE RECEIPTS. 3. AGGRIEVED BY THE ORDER OF THE A.O., THE ASSESSEES WENT ON APPEAL BEFORE THE CIT(A) AND THE LD. CIT(A) ALLOWED THE EXEMPTION U/S 11 OF THE ACT SINCE THE ASSESSEES ARE ENJOYING REGISTRATION U/S 12AA OF THE ACT. HOWEVER, THE CIT(A) REJECTED THE CLAIM OF THE ASSESSEE WITH REGARD TO THE EXPENDITURE INCURRED FOR LINK ROAD PROJECTS AS UNDER: HEAD AMC TADE- PALLEGUDEM ITA NO.237/ VIZ/2015 A.Y. 2003-04 AMC ACHANTA ITA NO.238/ VIZ/2015 A.Y. 2003-04 AMC NARASA- PURAM ITA NO.239/ VIZ/2015 A.Y. 2003-04 AMC PALAKOL ITA NO.253/ VIZ/2015 A.Y. 2003-04 AMC PALAKOL ITA NO.254/ VIZ/2015 A.Y. 2004-05 EXPENDITURE INCURRED U/S 15 : LINK ROADS & RURAL GODOWNS 25,00,000.00 22,50,000.00 22,50,000.00 22,76,000.00 47,35,400.00 4. THE CIT(A) REJECTED THE CLAIM OF ASSESSEE FOR WANT OF G.O. FROM THE COMPETENT AUTHORITIES OF GOVERNMENT OF A.P. THE ASSESSEE PLACED THE G.O./ SANCTION ORDERS FROM THE GOVERNMENT OF ANDHRA PRADESH VIDE FOLLOWING ORDERS AND REQUESTED FOR ADMISSION OF ADDITIONAL EVIDENCE. 1. ORDER DATED 19.9.2001 BY THE PRINCIPAL SECRETARY TO GOVT. OF ANDHRA PRADESH SANCTIONING THE WORK OF EXECUTION OF LINK ROADS BY AGRICULTURAL MARKETING COMMITTEES, PERMITTING THE AMCS TO INCUR EXPENDITURE WHERE IN THE APPELLANT WAS ALLOTTED RS.50,00,000/- TO SPEND ON LINK ROADS. 2. CIRCULAR DATED 20.9.2001 FROM THE OFFICE OF THE DIRECTOR OF MARKETING, GOVERNMENT OF ANDHRA PRADESH DIRECTING THE DISTRICT COLLECTORS TO SANCTION THE EXECUTION OF LINK ROADS. ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 4 5. THE LD. A.R. SUBMITTED THAT DURING THE APPEAL PROCEEDINGS BEFORE CIT(A), THE CITED ORDERS COULD NOT BE PLACED BECAUSE THE ASSESSEE COULD NOT EXPECT THE REQUIREMENT OF SUCH ORDERS/SANCTIONS. THE LD. A.R. FURTHER ARGUED THAT THE EXPENSES WERE INCURRED FOR THE PURPOSE OF THE OBJECTS OF THE SOCIETY AND IN ACCORDANCE WITH THE SANCTION ORDERS FROM THE COMPETENT AUTHORITIES AND THERE WAS NO DISPUTE WITH REGARD TO THE GENUINENESS OF THE EXPENDITURE, HENCE, THE LD. COUNSEL REQUESTED FOR THE ADMISSION OF THE ADDITIONAL EVIDENCES. 6. ON THE OTHER HAND, THE LD. D.R. VEHEMENTLY OPPOSED FOR ADMISSION OF THE ADDITIONAL EVIDENCE. 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE LD.CIT(A) REJECTED THE CLAIM EXPENSES FOR WANT OF SANCTION ORDERS FROM THE COMPETENT AUTHORITIES. SINCE THE ASSESSEE HAS FURNISHED THE RELEVANT SANCTION ORDERS, WHICH ARE CRUCIAL FOR ALLOWING THE EXPENDITURE INCURRED FOR OBJECTIVES, WE ADMIT THE ADDITIONAL EVIDENCE. 8. THE ASSESSEE HAS FURNISHED THE ADDITIONAL EVIDENCES EVIDENCING THE SANCTION OF APPROVAL PRESCRIBING THE GUIDELINES FOR TAKING UP LINK ROADS UNDER VARIOUS AGRICULTURAL MARKET COMMITTEES IN THE STATE AND THE DIRECTOR (MARKETING) SENT THE PROPOSALS ALONG WITH GUIDELINES FOR EXECUTION OF LINK ROADS UNDER THE PURVIEW OF VARIOUS AGRICULTURAL MARKET ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 5 COMMITTEES IN THE STATE. AMC WISE ALLOTMENT OF FUNDS VIDE G.O. CITED ABOVE ARE AS FOLLOWS: 1. AMC TADEPALLIGUDEM - 50 LAKHS 2. AMC ACHANTA - 45 LAKHS 3. AMC NARASAPURAM - 45 LAKHS 4. AMC PALAKOL - 45.52 LAKHS 9. THE ASSESSEE ALSO FURNISHED THE CIRCULAR DATED 20.9.2001 OF THE DIRECTOR OF MARKETING, GOVERNMENT OF ANDHRA PRADESH REQUESTING THE AMCS TO EXECUTE THE LINK ROADS PROJECT. THE CIT(A) DID NOT ALLOW THE DEDUCTION OF EXPENDITURE FOR WANT OF THE SANCTION ORDERS FROM THE COMPETENT AUTHORITIES. SINCE THE ASSESSEE HAS FURNISHED THE RELEVANT ORDERS FROM THE COMPETENT AUTHORITIES CONSIDERING THE FACTS AND MERITS OF THE CASE IN THE INTEREST OF JUSTICE, WE ARE OF THE CONSIDERED OPINION THAT THE ISSUE SHOULD BE REMITTED BACK TO THE FILE OF THE A.O. TO CONSIDER THE ADDITIONAL EVIDENCE AND DECIDE THE ISSUE AFRESH ON MERITS. ACCORDINGLY, THE ISSUE IS REMITTED TO THE FILE OF THE A.O. FOR DE-NOVO CONSIDERATION. 10. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEES ARE ALLOWED FOR STATISTICAL PURPOSES. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 20 TH DEC17. SD/- SD/- ( . . ) ( . [ ) (D.S. SUNDER SINGH) (V. DURGA RAO) /ACCOUNTANT MEMBER /JUDICIAL MEMBER ITA NOS.237, 238, 239, 253 & 254 OF 2015 /VIZAG/2015 TADEPALLIGUDEM 6 /VISAKHAPATNAM: /DATED : 20/12/2017 VG/SPS /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANTS (1) AGRICULTURAL MARKET COMMITTEE, TADEPALLIGUDEM, (2) AGRICULTURAL MARKET COMMITTEE, ACHANTA (3) AGRICULTURAL MARKET COMMITTEE, NARASAPURAM (4) AGRICULTURAL MARKET COMMITTEE, PALAKOL 2. / THE RESPONDENT (1) ITO WARD-1, TADEPALLIGUDEM (2) ITO WARD-1, PALAKOL (3) ITO, WARD-1, PALAKOL 3. / THE CIT, RAJAHMUNDRY 4. ( ) / THE CIT (A), RAJAHMUNDRY 5. , , / DR, ITAT, VISAKHAPATNAM 6 . [ / GUARD FILE / BY ORDER // TRUE COPY // SR. PRIVATE SECRETARY ITAT, VISAKHAPATNAM