M/s.Thalassery Range Kallu Chethu Vyavasaya Thozhilali Co-op Society Ltd, Kannur V. The ITO, Kannur

ITA 328/COCH/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96702 (ITAT-COCHIN)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-09-2015
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 01-09-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 04-06-2015
• Court: TRIBUNAL
• Department Lawyers: V R GOPAKUMAR
• Assessee Lawyers: T M SREEDHARAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH C OCHIN BEFORE S/SHRI B.P. JAIN, AM AND GEORGE GEOR GE K., JM I.T.A. NO. 328/COCH/2015 ASSESSMENT YEAR : 2010-11 M/S. THALASSERY RANGE KALLU CHETHU VYVASAYA THOZHILALI CO- OPERATIVE SOCIETY LTD., C.H. MANDIRAM, T.C. ROAD, THALASSERY , KANNUR-670 104. [PAN: AABTT 3822G] VS. THE INCOME TAX OFFICER, WARD-2, KANNUR. (ASSESSEE -APPELLANT) (REVENUE-RESPONDENT) ASSESSEE BY SHRI T.M. SREEDHARAN, SR. ADV. REVENUE BY SHRI V.R. GOPAKUMAR, SR. DR DATE OF HEARING 01 /09/2015 DATE OF PRONOUNCEMENT 03/09/2015 O R D E R PER B.P.JAIN, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS ARISING FROM THE ORDER OF THE CIT(A), MANANCHIRA, KOZHIKODE DATED 30/03/2015 FOR THE ASSESSMENT YEAR 2010-11. 2. THE ASSESSEE HAS RAISED AS MANY AS 12 GROUNDS OF APPEAL MAINLY FOR DISALLOWANCE MADE U/S. 80P(2)(A)(VI) AND 80P(2)(A)( III) OF THE ACT. I.T.A. NO.328/COCH/2015 2 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS ENGAGED IN THE BUSINESS OF SALE OF TODDY AND HAS CLAIMED DEDUCTION U/S. 80P OF THE ACT IN THE RETURN OF INCOME WHICH WAS REJECTED BY THE ASSE SSING OFFICER. 4. WITH REGARD TO THE DEDUCTION U/S. 80P(2)(A )(VI), THE CIT(A) REJECTED THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE BY FOL LOWING THE DECISION OF THE ITAT, COCHIN BENCH IN AN IDENTICAL ISSUE IN THE CASE OF ITO, WARD-2, KANNUR VS. M/S. PERAVOOR RANGE KALLU CHETHU VYAVASA YA THOZHILALI SAHAKARANA SANGAM IN I.T.A. NO. 399/COCH/2013 DATED 17/01/2014 FOR THE ASSESSMENT YEAR 2009-10. 5. AS REGARDS THE ALTERNATIVE CLAIM OF THE ASSE SSEE RELATING TO DEDUCTION U/S. 80P(2)(A)(III) OF THE ACT THAT THE CO-OPERATIV E SOCIETY IS ENGAGED IN MARKETING OF AGRICULTURAL PRODUCE GROWN BY ITS MEMB ERS, THIS ISSUE WAS REMANDED TO THE ASSESSING OFFICER WHO FURNISHED HIS REMAND REPORT ON 20/03/2015 WHICH IS REPRODUCED IN THE ORDER OF THE CIT(A). AFTER CONSIDERING THE ARGUMENTS OF THE ASSESSEE AND THE R EMAND REPORT OF THE ASSESSING OFFICER, THE CIT(A) REJECTED THE GROUNDS OF APPEAL OF THE ASSESSEE AND DISMISSED THE APPEAL. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THE LD. COUNSEL FOR THE ASSESSEE ARGUED THAT THE ASSESSEE IS I.T.A. NO.328/COCH/2015 3 MARKETING TODDY TAPPED BY THE MEMBERS FROM THEIR OW N LAND. BUT SUCH ARGUMENT ADVANCED BY THE LD. COUNSEL FOR THE ASSESS EE IS NOT SUPPORTED BY ANY DOCUMENTARY EVIDENCE EITHER BEFORE US OR BEFORE ANY OF THE AUTHORITIES BELOW. IN THE REMAND REPORT, THE ASSESSING OFFICER HAS CLEARLY MENTIONED THAT AS PER THE DETAILS AND ACCOUNTS FILED, THE ASS ESSEE HAS NOT CARRIED OUT ANY SUCH ACTIVITY AS DEFINED U/S. 2(1A) OF THE ACT AND ACCORDINGLY, THE INCOME FROM EXTRACTION AND SALE OF TODDY CANNOT BE TREATED AS AGRICULTURAL INCOME. THE ASSESSEE IS NOT IN POSSESSION OF EITHE R OWN AGRICULTURAL LAND OR LAND TAKEN ON LEASE. THE ONLY RIGHT OF THE ASSESSE E HAS ON THE COCONUT TREE TO EXTRACT TODDY WHICH IS OBTAINED FROM THE OWNER O F THE TREE ON PAYMENT OF PATTAM(A FIXED AMOUNT PER TREE). NO INTEREST IN THE LAND IS TRANSFERRED TO THE SOCIETY OR TO THE MEMBERS. A LEASE IS PERMIS SIBLE ONLY ON AN IMMOVABLE PROPERTY AND WHAT THE ASSESSEE HAS OBTAIN ED IS A MERE LICENSE TO TAP THE TREES AND TAPPING OF THE TREE ARE NOT AC TIVITIES WHEREBY THE AGRICULTURAL PRODUCE HAS BEEN RAISED. IN THE DECIS ION RENDERED BY THE FULL BENCH OF THE HONBLE MADRAS HIGH COURT IN CIT VS. Y AGAPPA NADAR AIR 1927 (MAD.) 923, IT WAS HELD HAS UNDER: INCOME DERIVED FROM TODDY IS AGRICULTURAL INCOME W HEN IT IS RECEIVED BY THE ACTUAL CULTIVATOR, WHETHER OWNER OR LESSEE OF T HE LAND ON WHICH THE TREE GROW. IF THE INCOME IS OBTAINED BY A PERSON W HO HAS NOT PRODUCED THE TREES FROM WHICH THE TODDY IS TAPPED; OR HAS NO T DONE ANY AGRICULTURAL OPERATION WHEREBY THOSE TREES HAVE BEE N RAISED, IT IS NOT AGRICULTURAL INCOME WITHIN THE MEANING OF THE ACT. I.T.A. NO.328/COCH/2015 4 THEREFORE, THE ASSESSEE HAS NOT SATISFIED THE CONDI TIONS LAID DOWN IN SECTION 80P(2)(A)(VI) AND 80P(2)(A)(III) AND HENCE THE ASSE SSEE IS NOT ELIGIBLE FOR CLAIM OF DEDUCTION U/S. 80P OF THE ACT. 7. AS REGARDS DISALLOWANCE OF DEDUCTION U/S. 8 0P(2)(A)(VI) OF THE ACT, WE CONFIRM THE ORDER OF THE CIT(A) WHO HAS RIGHTLY FOL LOWED THE DECISION OF THE COCHIN BENCH OF THE TRIBUNAL IN THE CASE OF M/S. PE RAVOOR RANGE KALLU CHETHU VYAVASAYA THOZHILALI SAHAKARANA SANGAM (CITE D SUPRA) ON AN IDENTICAL ISSUE. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A) WHO HAS RI GHTLY DISMISSED ALL THE GROUNDS OF APPEAL OF THE ASSESSEE. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 03 -09-2015. SD/- SD/- (GEORGE GEORGE K.) (B.P. JAIN) JUDICIAL MEMBER ACC OUNTANT MEMBER PLACE: KOCHI DATED: 3RD SEPTEMBER, 2015 GJ COPY TO: 1. M/S. THALASSERY RANGE KALLU CHETHU VYVASAYA THOZ HILALI CO-OPERATIVE SOCIETY LTD., C.H. MANDIRAM, T.C. ROAD, THALASSERY , KANNUR-670 104. 2. THE INCOME TAX OFFICER, WARD-2, KANNUR. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS), KOZHIKO DE. I.T.A. NO.328/COCH/2015 5 4. THE COMMISSIONER OF INCOME-TAX, KOZHIKODE. 5. D.R., I.T.A.T.,COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I. T.A.T., COCHIN