Krishi Upaj Mandi Samiti, CHURU V. ITO, CHURU

ITA 265/JODH/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54436 (ITAT-JODHPUR)
• Duration Of Justice: 1 year(s) 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 12-12-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 27-04-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MN MO RYA
• Keywords: Benefit of exemption
• Section: 12A; 11

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR (BEFORE SHRI R.K. GUPTA AND SHRI .N.L. KALR A ) ITA NO. 265/JU/2010 ASSESSMENT YEARS: 2006-78 PAN: AAATK 9688 A M/S. KRISHI UPAJ MANDI SAMITI VS. THE ITO SADULPUR, CHURU WARD- 1, CHURU (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY: SHRI M.N. MORYA DATE OF HEARING: 12-12-2011 DATE OF PRONOUNCEMENT: 16-12-2011 ORDER PER N.L. KALRA, AM:- THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDE R OF THE LD.CIT(A)-III, JAIPUR DATED 15-12-2009 FOR THE ASSESSMENT YEAR 2006-07. 2.1 THE FIRST GROUND OF ASSESSEE IS THAT THE LD. CI T(A) HAS ERRED IN HOLDING THAT MANDI SAMITI IS NOT A LOCAL AUTHORITY W.E.F. 1-04-2003 AN D THE INCOME IS NOT EXEMPT U/S 10(20) OF THE ACT. 2.2 THE EXPLANATION 10 (20) OF THE ACT HAS BEEN INT RODUCED BY THE FINANCE ACT, 2002 W.E.F. . 01-04-2003. AS PER THIS EXPLANATION, LOCAL AUTHORITIES HAVE BEEN DEFINED TO BE PANCHAYAT, MUNICIPALITY, MUNICIPAL COMMITTEE AND CA NTONMENT BOARD. EARLIER, THE HON'BLE APEX COURT IN THE CASE OF UNION OF INDIA V S R.C. JAIN AIR 981 SC LAID DOWN FIVE INGREDIENTS WHICH WERE REQUIRED TO BE FULFILLE D CUMULATIVELY BEFORE AUTHORITY WHICH CAN BE SAID TO BE A LOCAL AUTHORITY. THIS WAS CONSI DERED IN THE LIGHT OF DEFINITION OF LOCAL AUTHORITY AS GIVEN IN SECTION 3 (31) OF GENERAL CLA USES ACT. ONCE THE DEFINITION OF LOCAL 2 AUTHORITY HAS BEEN MENTIONED IN THE INCOME-TAX ACT, THEN THE DEFINITION OF LOCAL AUTHORITY AS CONTAINED GENERAL CLAUSES ACT CANNOT BE INCORPOR ATED FOR DECIDING THE ISSUE AS TO WHETHER THE SOCIETY CAN BE CONSIDERED A LOCAL AUTHO RITY. WE THEREFORE, FEEL THAT THE LD.CIT(A) WAS JUSTIFIED IN HOLDING THAT MANDI SAMIT I IS NOT A LOCAL AUTHORITY. 3.1 THE SECOND GROUND OF ASSESSEE IS THAT THE LD. C IT(A) HAS NOT HELD THAT MANDI SAMITI WILL BE ELIGIBLE FOR BENEFIT OF EXEMPTION U/ S 11 BECAUSE THE APPLICATION U/S 12A WAS NOT DISPOSED OFF WITHIN SIX MONTHS. 3.2 THE LD.CIT(A) IN HIS ORDER HAS MENTONED THAT TH E ASSESSEE FILED AN APPLICATION FOR REGISTRATION U/S 12A OF THE ACT ON 4 TH MA, 2007. THIS APPLICATION WAS NOT DISPOSED OFF WITHIN SIX MONTHS. THE LD.CIT(A) HELD THAT THE ACCE PTANCE OF APPLICATION OF REGISTRATION WILL BE FROM THE DATE WHEN THE A HAS FILED THE APPL ICATION WHILE THE ASSESSMENT YEAR INVOLVED BEFORE HIM IS ASSESSMENT YEAR 2006-07. THE LD.CIT(A) HAS UPHELD THE DEEMED ACCEPTANCE OF THE APPLICATION BECAUSE NO ORDER HAS BEEN PASSED. HOWEVER, WE ARE NOT HAVING THE BENEFIT OF GOING THROUGH THE APPLICATION BECAUSE COPY OF APPLICATION IS NOT AVAILABLE. IN CASE THE ASSESSEE REQUESTED VIDE THAT APPLICATION FOR GRANT OF REGISTRATION FROM EARLIER DATE THEN DEEMED REGISTRATION WILL BE FORM THAT DATE. THE REVENUE IS NOT IN APPEAL BEFORE US AND THEREFORE, THE QUESTION OF DEE MED REGISTRATION IS NOT DISPUTED BEFORE US. WE THEREFORE, RESTORE THE ISSUE ON THE FILE OF THE AO IN CASE THE APPLICATION FOR REGISTRATION FILED ON 4-05-07 CONTAINS THE REQUEST FOR REGISTRATION FOR THE PERIOD APPLICABLE TO THE ASSESSMENT YEAR 2006-06 THEN THE ASSESSEE WI LL BE ENTITLED FOR EXEMPTION U/S 11 OF THE ACT. HENCE, THIS ISSUE IS RESTORED BACK ON THE FILE OF THE AO. 4.1 THE THIRD GROUND OF ASSESSEE IS THAT THE LD. CI T(A) HAS ERRED IN NOT ACCEPTING THE CONTENTION OF THE ASSESSEE THAT ENTIRE SURPLUS OF R S. 6,65,660/- IS NOT LIABLE TO TAX. 3 4.2 THIS ISSUE WILL HAVE TO BE DECIDED AFTER RECORD ING THE FINDINGS AS TO WHETHER THE ASSESSEE IS ENTITLED FOR EXEMPTION. HENCE, THIS ISS UE IS ALSO RESTORED BACK ON THE FILE OF THE AO. 5.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PA RTLY ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 16 -12-2011. SD/- SD/- (R.K. GUPTA) (N.L. KALRA) JUDICIAL MEMBER ACCOUNTANT MEMBER JODHPUR DATED: 16 /12/2012 MISHRA COPY TO: 1. M/S. KRISHI UPAJ MANDI SAMITI, SADULPUR, CHURU 2. THE ITO, WARD- CHURU 3.THE LD. CIT (A) BY ORDER 4.THE CIT 5.THE D/R 6.THE GUARD FILE (ITA NO.265//JU/10) A.R.. ITAT: JODHPUR