ASST CIT (E) I(1), MUMBAI V. GOREGAON SPORTS CLUB, MUMBAI

ITA 3809/MUM/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 101118 (ITAT-MUMBAI)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 18-08-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 22-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 12A

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN ,AM AND LALIT KUMAR, JM ./ I.T.A. NO . 3809 / MUM/20 1 5 ( / ASSESSMENT YEA R : 20 10 - 11 ) ASST T.COMMISSIONER OF INCOME TAX, (EXEMPTION) - I(1), ROOM NO.506, 5 TH FLOOR,PIRAMAL CHAMBERS, PAREL, MUMBAI - 400012 / VS. GOREGAON SPORTS CLUB, OPP SWAGAT PARK, CHINCHOLI BUNDER, LINK ROAD, MALAD (W), MUMBAI - 400064 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN : AA AT G 0279P / APPELLANT BY SHRI AIRIJU JAIKARAN / RSPONDENT BY SHRI HARESH P SHAH / DATE OF HEARING : 1 8 .8 . 201 5 / DATE OF PRONOUNCEMENT: . 9 . 201 5 / O R D E R P ER LALITKUMAR : THE REVENUE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 13.2.2015 PASSED BY THE LD. CIT(A) - 7 , MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 20 10 - 11 . 2. THE EFFECTIVE GROUNDS OF APPEAL URGED BY THE REVENUE READ AS UNDER: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) WAS RIGHT IN HOLDING THAT THE ASSESSEE PERFORMS A CHARITABLE PURPOSES WITHIN THE MEANING OF SECTI ON 2(15) OF THE INCOME TAX ACT, 1961. ITA NO. 3809 / MUM/20 1 5 2 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN IGNORING THE DECISION, BEING THE FACTS ARE SAME, THE HONBLE ITAT BBENCH MUMBAI IN THE CASE OF NAVI MUMBAI MERCHANTS GYMK HAN A , VIDE ORDER NO.ITA NO.196/MUM/2013 DATED 21.5.2014, IN WHICH IT HAS BEEN HELD THAT THE CLUB IS NOT A CHAR I T A BLE ORGANIZATION WITHIN T HE MEANING OF SECTION 2(15) OF THE INCOME TAX ACT, 1961 3. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN ALLOWING THE CLAIM OF THE ASSESSEE FOR SET OFF AND CARRY FORWARD OF DEFICIT OF EARLIER YEARS, IGNORING THE F A CT THAT THERE WAS NO EXPRESS PROVISION IN THE INCOME TAX ACT, 1961 PERMITTING ALLOWANCE OF SUCH CLAIM 3 . WE HEARD THE PARTIES AND PERUSED THE RECORDS. THE ASSESSEE IS A TRUST , FORMED WITH THE OBJECT IVE OF ENCOURAGING PHYSICAL EDUCATION BY TRAINING AND COACHING IN VARIOUS SPORTS DISCIPLINES. THE TRUST WA S RE GISTERED U/S 12A OF THE ACT BY THE DIRECTOR OF INCOME TAX (EXEMPTION), MUMBAI. IT IS ALSO REGISTERED WITH CHARITY COMMISSIONER, MUMBAI. THE AO , BY FOLLOWING THE ASSESSMENT ORDER PASSED BY HIM FOR THE ASSESSMENT YEAR 2009 - 10, HELD THAT THE ACTIVITIES CARRIED ON BY THE ASSESSEE TRUST SHOULD BE TREATED AS BUSINESS /PROFESSIONAL ACTIVITIES AND ACCORDINGLY THE INCOME DERIVED THERE FROM WAS TREATED AS BUSINESS/PROFESSIONAL INCOME. ACCORDINGLY, HE DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT RS.4.64 CRORES . 4. IN THE APPELLATE PROCEEDINGS, THE LD.CIT(A) NOTICED TH AT THE HONBLE BOMBAY HIGH COURT HAS CONSIDERED THE NATURE OF ACTIVITIES CARRIED ON BY THE ASSESSEE IN THE APPEAL FILED BY IT FOR ASSESSMENT YEAR 2003 - 04 AND THE HONBLE JURISDICTIONAL HIGH COURT , VIDE ITS ORDER REPORTED IN (2012) 347 ITR 338 (BOM) , HELD THAT THE ASSESSEE IS A C HARITABLE INSTITUTION. THE LD. CIT(A) ALSO NOTICED THAT THE TRIBUNAL HAS FOLLOWED THE DECISION OF HONBLE HIGH COURT IN THE ASSESSMENT YEAR 2003 - 04 WHILE ADJUDICATING THE APPEAL S FILED BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2007 - 08 TO 2009 - 10. ITA NO. 3809 / MUM/20 1 5 3 ACCORDINGLY, THE LD. CIT(A) HELD THAT THE ASSESSEE IS A C HARITABLE INSTITUTION AND IT S INCOME HAS TO BE COMPUTED U/S 11 TO 13 OF THE ACT . THE LD. CIT(A) ALSO HELD THAT THE ASSESSEE IS ENTITLED TO CARRY FORWARD AND CLAIM SET OFF OF THE DE FICIT (EXCESS APPLICATION OF INCOME MADE) ARISING IN THE EARLIER YEARS AGAINST CURRENT YEARS INCOME U/S 11 OF THE ACT. F OR TH IS PURPOSE, THE LD. CIT(A) PLACED RELIANCE ON THE DECISION RENDERED BY THE HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE O F CIT V S . INSTITUTE OF BANKING PERSONNEL SELECTION REPORTED IN 264 ITR 110 (BOM) . AGGRIEVED BY THE ORDER OF LD. CIT(A), THE REVENUE HAS FILED THIS APPEAL BEFORE US. 5. WE HEARD THE PARTIES AND PERUSED THE RECORDS. WITH REGARD TO THE FIRST ISSUE, WE NO TICE THAT THE SAME IS COVERED BY THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE ASSESSEES OWN CASE REFERRED SUPRA. FURTHER THE CO - ORDINATE BENCH OF TRIBUNAL HAS ALSO FOLLOWED THE SAID DECISION IN ORDER TO DECIDE AN IDENTICAL ISSUE IN FAVOUR OF THE ASSES SEE IN ASSESSMENT YEAR S 2007 - 08 TO 2009 - 10. WE ALSO NOTICE THAT IT IS NOT THE CASE OF THE AO THAT THE ASSESSEE IS HIT BY THE PROVISO TO SEC. 2(15) OF THE ACT. HENCE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT(A) WITH REGARD TO THE FIRST ISSUE. 6 . WITH REGARD TO THE SECOND ISSUE, WE NOTICE THAT THE LD. CIT(A) HAS FOLLOWED THE DECISION RENDERED BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V S . INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA). HENCE, WE DO NOT FIND ANY RE ASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A) ON THIS ISSUE ALSO. ITA NO. 3809 / MUM/20 1 5 4 7 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED . PRONOUNCED ACCORDINGLY ON 23RD SEPT 2015. 23RD SEPT , 2015 SD SD ( B.R.BASKARAN) ( LALIT KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI: 23RD SEPT , 2015 . . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CON CERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI