The Krishi Upaj mandi Samiti, Barwaha V. The ACIT, Indore

ITA 308/IND/2010

• Counselvise Citation: 30822714 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-07-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 17-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Assessee Lawyers: N AGRAWAL
• Keywords: Depreciation; Charitable institution; Opportunity of being heard; Revised return
• Section: 12A; 12AA; 12; 11

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.279/IND/2010 AY: 2006-07 ASSTT. COMMR. OF INCOME TAX 5(1), INDORE ..APPELLANT V/S. KRISHI UPAJ MANDI SAMITI BARWAHA PAN AAGFK9033K ..RESPONDENT ITA NO.308/IND/2010 AY: 2006-07 KRISHI UPAJ MANDI SAMITI BARWAHA ..APPELLANT VS ASSTT. COMMR. OF INCOME TAX 5(1), INDORE ..RESPONDENT DEPARTMENT BY : SHRI ARUN DEWAN ASSESSEE BY : SHRI N. AGRAWAL ORDER PER JOGINDER SINGH, JUDICIAL MEMBER 2 THE REVENUE AS WELL AS THE ASSESSEE ARE IN CROSS APPEALS AGAINST THE ORDER OF THE LEARNED COMMISSION ER OF INCOME TAX (APPEALS) DATED 4.2.2010. THE REVENUE HA S CHALLENGED THE DELETION OF ADDITION MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ARAKSHIT NIDHI (RS. 2,65,330/-), KRISHI ANUSANDHAN NIDHI (RS. 5,32,895/ -), KISAN SADAK NIDHI (RS. 43,89,598/-) AND MANDI BOARD SHULK (RS. 3,99,391/-) WHEREAS THE ASSESSEE IS IN A PPEAL AGAINST THE SAME ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IN NOT ALLOWING DEPRECIATION AS CLAIMED BY THE ASSESSEE ON WDV AS ON 1.4.2005 BY HOLDING THAT THE ASSESSEE SAMITI IS NOT ENTITLED TO EXEMPTION U/S 11(A) TO (D) WITHOUT CONSIDERING THE REVISED RETURN FILED BY THE ASSESSEE AND ALSO IN OP INING THAT NO PROPER AND VALID CLAIM U/S 11 WAS LODGED BE FORE THE ASSESSING OFFICER. 2. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTI ES AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON THE FILE. 3 THE CRUX OF ARGUMENTS ON BEHALF OF THE REVENUE IS T HAT THE LD. FIRST APPELLATE AUTHORITY HAS MERELY RELIED UPON THE DECISION OF THE TRIBUNAL AND DECIDED ON THE BAS IS THAT THE ISSUES ARE COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF KUMS, SANAWAD. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE CONTENDED T HAT THE ASSESSEE WAS GRANTED REGISTRATION U/S 12AA OF T HE ACT FOR WHICH OUR ATTENTION WAS INVITED TO PAGE 10 OF THE PAPER BOOK. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. WE FIND THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS DECIDED TH E ISSUES BROADLY ON THE BASIS OF THE ORDER OF THE TRI BUNAL AS CLAIMED BEFORE US. HOWEVER, WE FIND THAT SINCE THE ASSESSEE WAS GRANTED REGISTRATION U/S 12A VIDE ORDE R DATED 19.7.2007 BY THE LEARNED COMMISSIONER OF INCO ME TAX, INDORE, PURSUANT TO THE DIRECTION OF THE TRIBU NAL, 4 DATED 6.6.2007 WITH EFFECT FROM THE CREATION OF THE ASSESSEE SAMITI, THEREFORE, THE WHOLE ISSUE NEEDS R E- EXAMINATION AT THE LEVEL OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS SUPPOSED TO EXAMINE WHETHER TH E INCOME HAS BEEN APPLIED FOR CHARITABLE PURPOSES AS PRESCRIBED UNDER THE ACT. AS FAR AS THE BENEFIT U/ S 11 OF THE ACT IS CONCERNED, A CONJOINT READING OF SECTION S 11, 12 AND 12A MAKES IT CLEAR THAT REGISTRATION U/S 12A IS A CONDITION PRECEDENT FOR AVAILING BENEFIT U/S 11 AND 12 OF THE ACT. THE ACCUMULATED OR SET APART INCOME SHOULD NOT BE IN EXCESS OF 15% OF THE TOTAL INCOME AND 85% OF THE INCOME SHOULD BE APPLIED FOR CHARITABLE PURPOSES. LIKEWISE, IN THE APPEAL OF THE ASSESSEE THE ASSESSE E IS AGGRIEVED BY THE DECISION OF THE LEARNED COMMISSION ER OF INCOME TAX (APPEALS) BY HOLDING THAT THE INCOME OF THE SAMITI IS NOT ENTITLED TO EXEMPTION U/S 11(A) TO (D ) OF THE ACT. THE IMPUGNED ORDER IS DATED 4.2.2010 WHEREAS THE ASSESSEE WAS GRANTED REGISTRATION U/S 12A VIDE ORDE R DATED 19.7.2007. IT SEEMS THAT THIS FACT WAS NOT BR OUGHT 5 TO THE NOTICE OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS), CONSEQUENTLY, THE IMPUGNED ORDER IS SET ASIDE AND THE ASSESSING OFFICER IS DIRECTED TO RE-EXAMINE THE ISSUES INVOLVED IN THESE APPEALS IN THE LIGHT OF TH E REGISTRATION GRANTED TO THE ASSESSEE U/S 12A/12AA O F THE ACT AND DECIDE THE ISSUES IN ACCORDANCE WITH LAW FO R WHICH DUE OPPORTUNITY OF BEING HEARD BE PROVIDED TO THE ASSESSEE. FINALLY, THE APPEAL OF THE REVENUE AS WELL AS OF T HE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF HEARING ON 4 TH JULY, 2011. (R.C. SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER 4 TH JULY, 2011 COPY TO:APPELLANT/RESPONDENT/CIT/CIT(A)/DR/GUARD FI LE DN- 6