OTTERS CLUB, MUMBAI V. DDIT (E)-II(2), MUMBAI

ITA 2657/MUM/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 5055 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 01-08-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 19-04-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: A H DALAL; S E DASTUR NITESH JOSHI
• Keywords: Charitable institution
• Section: 143(3); 260A; 12A; 11

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND RAJENDRA (AM) . . , , ./I.T.A. NO.2250/MUM/2012 ( / ASSESSMENT YEAR:2008-09) ASSISTANT DIRECTOR OF INCOME TAX (EXEMPT)-II(1), ROOM NO.507, PIRAMAL CHAMBERS, LALBAUG,PAREL, MUMBAI-400012 / VS. M/S OTTER CLUB CATER ROAD, BANDRA (W), MUMBAI-400050 ( & / APPELLANT) .. ( ' & / RESPONDENT) ./I.T.A. NO.2657/MUM/2012 ( / ASSESSMENT YEAR:2008-09) M/S OTTER CLUB CATER ROAD, BANDRA (W), MUMBAI-400050 / VS. DY. DIRECTOR OF INCOME TAX (EXEMPT)-II(1), ROOM NO.507, 5 TH FLOOR, PIRAMAL CHAMBERS, LALBAUG,PAREL, MUMBAI-400012 ( & / APPELLANT) .. ( ' & / RESPONDENT) ./ ./PAN/GIR NO. : AAATO0013F & / REVENUE BY : MS. C TRIPURA SUNDARI ' & * /ASSESSEE BY : SHRI S.E.DAST UR, NITESH JOSHI AND A.H.DALAL * - / DATE OF HEARING : 13.8.2013 * - /DATE OF PRONOUNCEMENT : 13.9.2013 / O R D E R PER B.R.MITTAL, JM: THESE CROSS APPEALS ARE FILED BY DEPARTMENT AND ASS ESSEE AGAINST AN ORDER OF LD. CIT(A) DATED 16.23.2012. I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 2 2. FIRSTLY WE TAKE UP THE APPEAL OF DEPARTMENT FOR OUR CONSIDERATION BEING ITA NO. I.T.A. NO.2250/MUM/2012 AND THE GROUNDS OF APPEAL TAKEN BY DEPARTMENT ARE AS UNDER : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, AND IN LAW, THE LD. CIT(A) ERRED IN DIRECTING THE AO TO ALLOW EXEMPTION U/S 11 OF THE IT ACT, 1961 IGNORING THE FACT THAT THE INCOME OF THE ASSESSEE E ARNED FROM THE ACTIVITIES RELATING TO PROVIDING FOOD, LIQUOR, AND FACILITY F OR PLAYING CARDS AND OTHER SUCH GAMES WHICH DO NOT QUALIFY FOR DEDUCTION UNDER PR OVISIONS OF SECTION 11 OF THE ACT 2. ALTERNATIVELY WHEN THE ACTIVITIES OF THE TRUST IS LIMITED TO PROVIDING SPECIFIC SERVICES TO ITS MEMBERS WHY THE TRUST SHOULD NOT BE ASSESSED AS MUTUAL ASSOCIATION AND INCOME ARISING OUT OF NON ACTIVITIE S I.E. INTEREST ON SECURITIES, BANK ETC SHOULD NOT BE CHARGED TO TAX APPLYING THE RATIO OF DECISION IN THE CASE OF BANKIPUR CLUB LTD (226 ITR 97); 3. THE APPELLANT PRAYS THAT THE ORDER OF THE CIT(A ) BE SET ASIDE AND THAT OF THE AO BE RESTORED 3. THE RELEVANT FACTS ARE THAT THE ASSESSEE IS A C LUB REGISTERED WITH CHARITY COMMISSIONER AS PUBLIC CHARITABLE TRUST. THE ASSES SEE IS ALSO REGISTERED U/S 12A OF THE INCOME TAX ACT, 1961. THE ASSESSEE IS PROVIDING S WIMMING POOL FACILITIES FOR AQUATIC EVENTS, TRAINING AND FACILITIES FOR OTHER SPORTS S UCH AS SQUASH, BILLIARDS AND TABLE TENNIS ETC. THE ASSESSEE FILED RETURN OF INCOME DECLARIN G TOTAL DEFICIT AT RS.5,75,495/-. AO COMPLETED THE ASSESSMENT U/S 143(3) OF THE ACT BY T REATING THE ASSESSEE A MUTUAL ASSOCIATION AND NOT A CHARITABLE TRUST AND ALSO BY DENYING THE EXEMPTION U/S 11 OF THE ACT. 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO STATED THAT THE ASSESSEE IS IMPARTING THE FACILITIES OF PLAYING CARDS AND ALSO HAVING PERMIT ROOM BAR AND RESTAURANT FOR CATERING AND SOFT DRINKS. AO STATED THAT THE ASSESSEE WAS ASKED AS TO HOW THESE FACILITIES OF PLAYING CARDS AT STAKE, PERMIT ROOM, BAR AND RESTAURANT CONSTITUTE CHARITABLE ACTIVITIES AND NOT A BUSINESS ACTIVITY AS PROVIDED IN SECTION 11(4A) OF THE ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE A SSESSEE SUBMITTED THAT ITAT ALLOWED EXEMPTION U/S 11 OF THE ACT TO THE ASSESSEE FOR ASSESSMENT YEARS 1991-92 TO 2005-06 AND REQUESTED TO ALLOW EXEMPTION U/S 11 OF THE ACT. AO STATED THAT THE DEPARTMENT HAS NOT ACCEPTED THE ORDER OF ITAT AND T HE APPEAL HAD BEEN FILED FOR ASSESSMENT YEAR 1985-1986 WHICH IS PENDING BEFORE T HE HONBLE BOMBAY HIGH COURT. IT WAS ALSO STATED THAT THE APPEAL FOR ASSESSMENT YEAR S 1992-93 U/S 260A IS ALSO PENDING BEFORE THE HONBLE BOMBAY HIGH COURT AND THE QUESTI ON OF LAW INVOLVED IN THIS APPEAL IS AS UNDER : I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 3 WHETHER ON FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. ITAT, MUMBAI WAS JUSTIFIED IN HOLDING THAT THE INCOME MA DE BY THE ASSESSEE ON THE ACTIVITIES RELATED TO PROVISION OF FOOD, LIQUOR AND FACILITY FOR PLAYING CARDS AND OTHER SUCH GAMES QUALIFIED FOR DEDUCTION UNDER PRO VISIONS OF SECTION 11 OF THE IT ACT, 1961, ASSUMING THESE ACTIVITIES CONCERNING A GENERAL PUBLIC UTILITY/CHARITABLE PURPOSES. THE AO STATED THAT ASSESSEE IS A CLUB WHICH IS NOT OPEN TO GENERAL PUBLIC. THAT THE ENTRY TO THE CLUB IS RESTRICTED TO THE MEMBERS, TH EIR FAMILY MEMBERS AND GUEST ACCOMPANYING THEM. THAT THE NON-MEMBERS ARE ADMIT TED BY CHARGING COACHING FEES FOR THE SECTION OF THE GAME IN WHICH THEY ARE INTER ESTED. AO STATED THAT THOUGH DEVELOPMENT OF SPORTS IS A CHARITABLE OBJECT, BUT IN A CASE WHERE DOMINANT, SUBSTANTIAL OR MAIN OBJECT OF THE CLUB IS TO PROVIDE SERVICES T O ITS MEMBERS, IT CANNOT BE SAID TO HAVE BEEN CREATED FOR CHARITABLE PURPOSE. HE HAS S TATED THAT ON EXAMINATION OF THE ASSESSEES ACTUAL ACTIVITIES, IT SHOWS THAT THE DOM INANT OR RATHER THE PREDOMINANT OBJECT OF THE ASSESSEE IS TO PROVIDE SERVICE TO ITS MEMBE RS. AO STATED THAT ASSESSEE IS NOT AN ASSOCIATION CREATED/ESTABLISHED FOR CHARITABLE PUR POSE WITHIN THE MEANING OF THE PROVISIONS OF SECTION 2(15) OF THE ACT AND ACCORDI NGLY, DENIED EXEMPTION U/S 11 OF THE ACT AND BRINGING TO TAX THE AMOUNT OF RS.2,96,18, 279/- RECEIVED AS INTEREST ON SECURITIES BY COMPUTING THE INCOME AS NORMAL BUSINE SS INCOME OF THE ASSESSEE. BEING AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE THE FIR ST APPELLATE AUTHORITY. 5. LD. CIT(A), AFTER CONSIDERING THE ORDERS OF ITA T IN THE ASSESSEES OWN CASE FOR THE ASSESSMENT YEARS 1985-86 TO 1991-92 AND ALSO TAKING NOTE OF REASONS OF HIS PREDECESSOR FOR ASSESSMENT YEARS 2006-07 AND 2007- 08 HELD THAT THE INCOME OF THE ASSESSEE FROM SWIMMING POOL, OTHER SPORTS ACTIVIT IES BAR AND RESTAURANT ETC ARE ELIGIBLE FOR EXEMPTION U/S 11 OF THE ACT. LD.CIT(A) HAS ST ATED THAT THE TRIBUNAL HAS ALSO HELD IN ITS ORDER FOR ASSESSMENT YEARS 1985-86 & 1991-92 THAT ASSESSEE IS ENTITLED TO EXEMPTION U/S 11 OF THE ACT FOR ITS INCOME EXCEPT FOR INCOME FROM PROVIDING FACILITIES OF PLAYING CARDS. THE LD. CIT(A) HAS FURTHER STATED THAT THE TRIBUNAL FOR ASSESSMENT YEAR 2003-04 IN ITS ORDER DATED 28.1.2009 STATED THAT T HE ACTIVITIES OF THE ASSESSEE CLUB ON SOCIAL FUNCTIONS, PAVILION, BOARD ROOM, TERRACE AND CARD ROOM ARE NOT CLEARLY FOR THE OBJECT OF THE CLUB. THAT THE ONLY EXCEPTION BEING T HE FUNCTIONS ORGANIZED ON INDEPENDENCE DAY, REPUBLIC DAY AND DIWALI, THEREFOR E, THESE ACTIVITIES WOULD NOT QUALIFY FOR EXEMPTION U/S 11. THE LD. CIT(A) HAS HELD THA T ASSESSEE BEING CHARITABLE INSTITUTION BEING ELIGIBLE FOR EXEMPTION U/S 11 OF THE ACT. I N THE GIVEN SITUATION, THE ACTION OF THE AO IN BRINGING TO TAX THE INTEREST INCOME FROM SECU RITIES WHILE HOLDING THE ASSESSEE THE MUTUAL CONCERN IS NOT JUSTIFIED. HENCE, THESE APPE ALS BY THE ASSESSEE AS WELL AS BY THE DEPARTMENT. I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 4 6. AT THE TIME OF HEARING, LD. DR SUBMITTED THAT TH E ASSESSEE IS A PRIVATE CLUB AND IN VIEW OF DECISION OF HONBLE APEX COURT IN THE CA SE OF BANKIPUR CLUB LTD (226 ITR 97), THE INCOME FROM NON-MEMBER, INCOME IS CHARGEABLE AS THE INCOME FROM OUTSIDERS AS A COMMERCIAL TRANSACTION. SHE FURTHER SUBMITTED T HAT THE BENEFITS ARE DERIVED BY THE MEMBERS AND THUS THERE IS A VIOLATION OF SECTION 13 (1) AND 13(3) OF THE ACT WHICH WERE NOT CONSIDERED IN EARLIER YEARS. SHE FURTHER SUBM ITTED THAT ASSESSEE CAN CLAIM EXEMPTION ON THE BASIS OF PRINCIPLE OF MUTUALITY AND CANNOT CLAIM EXEMPTION AS A TRUST U/S 11 OF THE ACT AS THE BENEFIT IS RESTRICTED TO M EMBERS ONLY. LD. DR SUBMITTED THAT THE ASSESSEE IS A PROFIT MAKING ENTITY. THUS, THE ACTION OF THE AO SHOULD BE CONFIRMED. 7. ON THE OTHER HAND, LD. AR SUBMITTED THAT FACTS IN THE ASSESSMENT YEAR UNDER CONSIDERATION ARE IDENTICAL TO THE FACTS IN THE PRE CEDING ASSESSMENT YEARS WHICH HAVE BEEN CONSIDERED BY TRIBUNAL AND EVEN THE APPEAL FI LED BY THE DEPARTMENT AGAINST THE ORDER OF ITAT WAS DISMISSED BY THE HONBLE HIGH C OURT VIDE ITS ORDER DATED 4.8.2011 RELATING TO ASSESSMENT YEAR 2004-05 WHEREIN THE SIM ILAR ISSUE HAS RAISED BY THE DEPARTMENT IN THE APPEAL FOR THE ASSESSMENT YEAR UN DER CONSIDERATION. THE ISSUE RAISED WERE AS UNDER :. (A) WHETHER, ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE TRIBUNAL WAS RIGHT IN DIRECTING THE AO TO ALLOW EXE MPTION UNDER SECTION 11 OF THE INCOME TAX ACT, 1961 IGNORING THE FACT THAT THE INC OME OF THE ASSESSEE IS EARNED FROM THE ACTIVITIES RELATING TO PROVIDING FOOD, LIQ UOR AND FACILITY FOR PLAYING CARDS AND OTHER SUCH GAMES WHICH DO NOT QUALIFY FOR DEDU CTION UNDER THE PROVISIONS OF SECTION 11 OF THE INCOME TAX ACT, 1961 (B) WHETHER, ON THE FACTS AND CIRCUMSTANCES OF TH E CASE AND IN LAW, THE TRIBUNAL WAS RIGHT IN IGNORING THE FACT THAT THE AO HAS VIOLATED THE PROVISIONS OF SECTION 13 OF THE INCOME TAX ACT WHEREIN UNDUE BEN EFIT IS ENDURED ON THE PERSONS SPECIFIED UNDER SECTION 13(1) OF THE ACT AN D ALSO SUCH ACTIVITIES OF THE TRUST ARE NOT INCIDENTAL OBJECTS OF THE TRUST AND HENCE HAS NOT COMPLIED WITH THE REQUIREMENTS OF SECTION 11(4) OF THE ACT. 8. LD. AR SUBMITTED THAT THE HONBLE HIGH COURT VID E ITS ORDER DATED 4.8.2011 IN INCOME TAX APPEAL NO.2297 OF 2010 DISMISSED THE AP PEAL OF THE DEPARTMENT BY CONFIRMING THE ORDER OF TRIBUNAL. HE SUBMITTED T HAT DEPARTMENTS APPEAL FOR ASSESSMENT YEAR 2005-06 ON SIMILAR ISSUE WAS DISMIS SED VIDE ORDER DATED 5.12.2011 BY THE HONBLE HIGH COURT. HE SUBMITTED THAT THERE I S NO CHANGE IN THE PROVISIONS OF THE ACT AND /OR OBJECT CLAUSES OF THE ASSESSEE AND THE SOURCE OF INCOME IS ALSO THE SAME AS IN THE PRECEDING ASSESSMENT YEARS. LD.AR FURTHER SU BMITTED THAT THE INCOME FROM CARD I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 5 HAS NOT BEEN CLAIMED AS EXEMPT U/S 11 OF THE ACT. HE FURTHER SUBMITTED THAT THE AMENDMENT MADE IN SECTION 2(15) OF THE ACT BY FINAN CE ACT, 2010 IS WITH EFFECT FROM 1.4.2009 AND IS NOT APPLICABLE TO THE ASSESSMENT YE AR UNDER CONSIDERATION. LD. AR FURTHER SUBMITTED THAT FOR OTHER FACILITIES BEING A VAILED BY MEMBERS, THE PAYMENT IS MADE TO THE ASSESSEE CLUB AND THUS THERE IS NO VI OLATION OF SECTION 13(1) AND 13(3) OF THE ACT AS CONTENDED BY LD. DR. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. REPRES ENTATIVES OF THE PARTIES AND THE ORDERS OF AUTHORITIES BELOW. WE HAVE ALSO CONS IDERED THE EARLIER ORDERS OF THE TRIBUNAL. WE OBSERVE THAT THE TRIBUNAL DECIDED THE SIMILAR ISSUE IN ITA NO.5576/BOM/93 AND 6413/BOM/94 FOR ASSESSMENT YEARS 1985-86 AND 19 91-92 BY A COMMON ORDER DATED 26.8.2001 BY FOLLOWING THE DECISION OF SPECIA L BENCH IN THE CASE OF BREACH CANDY SWIMMING BATH TRUST, MUMBAI V/S ITO IN ITA NO.9039/ MUM/1992 WHEREIN IT WAS HELD THAT THE ACTIVITY OF BAR AND RESTAURANT WAS INCIDEN TAL TO THE MAIN OBJECT OF PROVIDING FACILITIES OF SWIMMING TO THE MEMBERS. THE TRIBUN AL HELD THAT THE ASSESSEE WAS ENTITLED TO EXEMPTION U/S 11 OF THE ACT EXCEPT INC OME FROM PLAYING CARDS. WE ALSO OBSERVE THAT THE TRIBUNAL VIDE ITS ORDER 22.5.2009 IN ITA NO.1892/MUM/2008 FOR ASSESSMENT YEAR 2004-05 DECIDED THE SAME ISSUE IN T HE ASSESSEES OWN CASE BY FOLLOWING THE DECISION IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2001-02 DATED 20.1.2008 IN ITA NO.4191/MUM/2005 THAT ASSESSEE IS ENTITLED TO DEDUCTION UNDER THE PROVISIONS OF SECTION 11 OF THE ACT. IN RESPECT OF FOOD AND LIQUOR, WE OBSERVE THAT ON PERUSAL OF ORDER OF TRIBUNAL DATED 28.1.2008 (SUPR A) THAT TRIBUNAL AFTER CONSIDERING THE DECISION OF SPECIAL BENCH OF ITAT, MUMBAI IN THE C ASE OF BREACH CANDY SWIMMING BATH TRUST, MUMBAI V/S ITO (AY-1990-91) DATED 31.7 .2003 INTERALIA HELD THAT BUSINESS OF BAR AND RESTAURANT IS PROPERTY HELD UNDER TRUS T FOR A CHARITABLE OBJECT WITHIN THE MEANING OF SECTION 11(4), NOT AFFECTED IN ANY WAY BY SECTION 11(4A) OF THE ACT. THUS, THE ASSESSEE TRUST IS ENTITLED TO EXEMPTION U/S 11 FOR ALL ITS INCOME EXCEPT FOR INCOME PROVIDING FACILITIES OF PLAYING CARDS. WE OBSERVE THAT THE TRIBUNAL BY FOLLOWING ITS EARLIER ORDERS DECIDED THE SIMILAR ISSUE BY A C OMMON ORDER DATED 6.9.2011 IN ITA NO.4494/MUM/2010 FOR ASSESSMENT YEAR 2006-07 AND I TA NO.5147/MUM/2010 FOR ASSESSMENT YEAR 2007-08. IN VIEW OF ABOVE AND RESP ECTFULLY FOLLOWING THE EARLIER ORDERS OF THE TRIBUNAL, WE CONFIRM THE ORDER OF LD. CIT(A) THAT ASSESSEE IS ENTITLED TO EXEMPTION U/S 11 FOR ITS INCOME EXCEPT INCOME PROV IDING FACILITIES OF PLAYING CARDS AND ACCORDINGLY REJECT GROUNDS OF APPEAL TAKEN BY THE DEPARTMENT. I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 6 10. NOW WE TAKE UP THE APPEAL OF ASSESSEE BEING I TA NO.2657/MUM/2012. 11. ASSESSEE HAS AMENDED THE GROUNDS OF APPEAL. GRO UND NOS.1 AND 2 OF THE AMENDED GROUNDS OF APPEAL ARE AS UNDER : 1. THE LD. CIT(A) ERRED IN UPHOLDING TAXING OF NET INTEREST INCOME OF RS.2,96,18,279 BY DISALLOWING PART OF THE EXPENDITU RE INCURRED FOR EARNING THE SAME. 2. THE LD. CIT(A) OUGHT TO HAVE HELD THAT EVEN IF T HE APPELLANT WAS TO BE REGARDED AS A MUTUAL ASSOCIATION THE ENTIRE NET INT EREST INCOME OF RS.2,96,18,279 WOULD NOT BE LIABLE TO TAX. 12. LD. AR SUBMITTED THAT IF IT IS HELD THAT THE AS SESSEE IS ENTITLED TO BENEFIT OF SECTION 11 OF THE ACT, GROUND NOS. 1 AND 2 OF THE A PPEAL DO NOT SURVIVE AND BECOME INFRUCTUOUS. 13. SINCE WE HAVE HELD HEREINABOVE THAT THE ASSESS EE IS ENTITLED TO BENEFIT OF SECTION 11 OF THE ACT, IN VIEW OF THE EARLIER ORDER S OF TRIBUNAL WHICH WERE ALSO CONFIRMED BY THE HONBLE JURISDICTIONAL HIGH COURT (SUPRA), THE GROUND NOS.1 AND 2 OF THE APPEAL TAKEN BY THE ASSESSEE ARE REJECTED. 14. AMENDED GROUNDS NO.3 AND 4 OF THE APPEAL TAKEN BY ASSESSEE ARE AS UNDER : 3. THE CIT(A) ERRED IN HOLDING THAT RECEIPTS FOR S OCIAL FUNCTIONS, PAVILION, BOARD ROOM AND OPEN TERRACE WOULD NOT BE ELIGIBLE FOR EXEMPTION UNDER SECTION 11 OF THE INCOME-TAX ACT. 4. IN THE ALTERNATIVE AND WITHOUT PREJUDICE TO THE ABOVE, THE LD. CIT(A) OUGHT TO HAVE HELD THAT INCOME FROM SOCIAL FUNCTION S, PAVILION, BOARD ROOM AND OPEN TERRACE COULD BE ASSESSED AFTER REDUC ING THE RECEIPTS FROM SUCH ACTIVITIES BY THE EXPENDITURE INCURRED IN RESPECT OF THE SAME. 15. WE OBSERVE THAT THE SIMILAR ISSUE IS ALSO COVER ED BY THE ORDER OF TRIBUNAL FOR ASSESSMENT YEAR 2003-04 DATED 28.1.2009 IN ITA NO.6 042/MUM/2006 AND THE RELEVANT PARA 2.1 OF THE SAID ORDER READS AS UNDER : 2.1 A PERUSAL OF THE ABOVE SUBMISSION CLEARLY REVE ALS THE TRUE NATURE THE ACTIVITIES UNDERTAKEN BY THE ASSESSEE. THE ACTIVIT IES OF THE ASSESSEE CLUB ON SOCIAL FUNCTIONS, PAVILION, BOARD ROOM, TERRACE AN D CARD ROOM WERE FOR PERSONAL PURPOSES AND ARE CLEARLY NOT FOR THE OBJEC T OF THE CLUB. THE ONLY EXCEPTION TO THIS DECISION OF OURS IS THE FUNCTIONS ORGANIZED ON INDEPENDENCE DAY, REPUBLIC DAY, DIWALI CELEBRATIONS AND LIKEWIS E ONLY. THEREFORE, THE I.T.A. NO.2250/MUM/2012 I.T.A. NO.2657/MUM/2012 7 ACTIVITIES NOT COVERED BY THE DECISION OF THE CO-O RDINATE BENCH WOULD NOT QUALIFY FOR EXEMPTION U/S 11 OF THE ACT. IN VIEW OF THIS, THE DECISION OF THE LD. CIT(A), IN RESPECT OF ACTIVITIES OF THE ASSESSEE N OT COVERED BY THE SAID DECISION OF THE CO-ORDINATE BENCH CANNOT BE SUSTAINED. THE REFORE, THE AO IS DIRECTED TO ALLOW THE EXPENSES AS PER OUR DIRECTIONS ON SUCH AC TIVITIES OF THE ASSESSEE WHICH ARE COVERED BY THE DECISION OF THE HONBLE CO-ORDIN ATE BENCH. TO THIS EXTENT APPEAL OF THE REVENUE IS ALLOWED. IN VIEW OF ABOVE AND RESPECTFULLY FOLLOWING THE ORD ER OF TRIBUNAL (SUPRA), WE REJECT GROUNDS NO.3 AND 4 OF THE APPEAL TAKEN BY ASSESSEE. 16. IN THE RESULT, APPEAL OF THE DEPARTMENT AS WELL AS THE APPEAL OF THE ASSESSEE BOTH ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13TH SEP TEMBER, 2013 * 1 2 13TH SEPTEMBER, 2013 * SD/- SD/- ( /RAJENDRA ) ( . . /B.R.MITTAL) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; 2 DATED 13 / 09/2013 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. & / THE APPELLANT 2. ' & / THE RESPONDENT. 3. 6 ( ) / THE CIT(A)- CONCERNED 4. 6 / CIT CONCERNED 5. 7 '9 , - 9 , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) - 9 , /ITAT, MUMBAI