Software Technology Park of India, New Delhi V. DCIT, New Delhi

ITA 4003/DEL/2015

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 5103 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2010-2011
• Appeal Filed On: 16-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Charitable institution; Opportunity of being heard; Earning of tax free income; Revised return; Capital expenditure; Set aside
• Section: 14A; 37(1); 13; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DELHI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER & SHRI DR. B.R.R. KUMAR, ACCOUNTANT MEMBER I.T.A. NO.4003/DEL/2015 ASSESSMENT YEAR 2010-11 SOFTWARE TECHNOLOGY PARKS OF INDIA, DIRECTOR GENERAL, SOFTWARE TECHNOLOGY PARK OF INDIA, 9 TH FLOOR, NDCC-II BUILDING, OPPOSITE JANTAR MANTAR, NEW DELHI. V. DCIT, CIRCLE-31(1), NEW DELHI. TAN/PAN: AAATS 2468J (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI ATUL NINAWAT, ADV. RESPONDENT BY: SHRI SANJAY GUPTA, CIT-D.R. DATE OF HEARING: 10 02 2020 DATE OF PRONOUNCEMENT: 17 02 2020 O R D E R PER AMIT SHUKLA, J.M.: THE AFORESAID APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE IMPUGNED ORDER DATED 31.03.2015 PASSED BY COMMISSIONER OF INCOME TAX (APPEALS)-XVIII, NEW DEL HI FOR THE QUANTUM OF ASSESSMENT PASSED U/S.143(3) FOR THE ASS ESSMENT YEAR 2010-11. IN THE GROUNDS OF APPEAL, THE ASSESSE E HAS RAISED FOLLOWING GROUNDS:- 1. THE ASSESSMENT ORDER IS BAD IN LAW AND ERRONEO US AND SHOULD THEREFORE BE SET ASIDE. 2. THE CIT(A) IS UNJUST IN DENYING THE EXEMPTION A ND BENEFIT OF SECTION 11 TO 13 OF THE INCOME TAX ACT, 1961 AND TR EATING THE I.T.AS. NO.4003/DEL/2015 2 ASSESSEE AS THE CHARITABLE TRUST. 3. THE CIT(A) HAS ERRED IN UPHOLDING THE ASSESSING OFFICERS CALCULATION AND TAXING THE GAINS FROM SALE OF PROPE RTY BY THE ASSESSEE AS BUSINESS INCOME INSTEAD OF CAPITAL GAIN S. 4. THE CIT(A) HAS ERRED IN UPHOLDING THE ADDITION OF RS. 74106972/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF PROFIT FROM STPI BANGALORE. 5. THE CIT(A) HAS ERRED IN UPHOLDING THE DISALLOWA NCE ON ACCOUNT OF THE DEDUCTION UNDER SECTION 35ABB OF RS. 2245000/-. 6. THE CIT(A) HAS ERRED IN UPHOLDING THE ADDITION ON ACCOUNT OF THE CAPITAL EXPENDITURE UNDER SECTION 37 OF RS. 135 90804/-. 7. THE CIT(A) HAS ERRED IN UPHOLDING THE DISALLOWA NCE UNDER SECTION 14A OF RS. 188532/-. 8. THE C1T(A) HAS ERRED IN UPHOLDING THE DISALLOWA NCE ON ACCOUNT OF THE PRIOR PERIOD EXPENSES TWICE UNDER SE CTION 37(1) THE INCOME TAX ACT, 1961 OF RS. 4382454/-. 9. THE CIT(A) HAS ERRED IN UPHOLDING THE DISALLOWA NCE OF THE EXPENDITURE TWICE UNDER SECTION 40(1)(IA) OF THE IN COME TAX ACT, 1961 OF RS. 584181/-. 10. THE APPELLANT PRAYS FOR LEAVE TO ADD, ALTER OR AMEND THE GROUNDS OF APPEALS. 2. AT THE OUTSET, IT WAS SUBMITTED BY THE LD. COUNS EL THAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009-10 MAT TER HAS BEEN REMANDED BACK BY THE TRIBUNAL TO DECIDE ALL TH ESE ISSUE AFRESH AND ON MERITS. 3. LD. DR HAS ALSO ADMITTED THAT MATTER CAN BE REST ORED BACK TO THE FILE OF THE ASSESSING OFFICER TO BE DECIDED IN LINE OF THE DIRECTION OF THE TRIBUNAL. I.T.AS. NO.4003/DEL/2015 3 4. THE FACTS IN BRIEF ARE THAT THE ASSESSEE-SOCIETY IS CARRYING OUT ACTIVITIES ON THE MANDATE OF GOVERNMENT OF INDI A, FOR THE DEVELOPMENT OF THE INFORMATION TECHNOLOGY ENVIRONME NT, TRADE AND INFRASTRUCTURE IN INDIA. LOOKING TO ITS CHARITA BLE ACTIVITIES, IT WAS REGISTERED U/S.12A. THE LD. ASSESSING OFFICER H ELD THAT ASSESSEE IS NOT ENTITLED TO SEEK RELIEF OR CLAIM EX EMPTION U/S.11 TO 13 AS IT WAS NOT PRODUCED ANY CERTIFICATE U/S.12 AA; AND FURTHER, ASSESSEE CANNOT BE ENTITLED FOR RELIEF, SI MPLY BECAUSE IT IS INDULGED IN CARRYING OUT THE SCHEME OF GOVERNMEN T IN PROMOTION OF BUSINESS AND EXPORT, ETC. HE OBSERVED THAT THE ASSESSEE SOCIETY HAS NOT BEEN FORMED BY AN ACT OF P ARLIAMENT AND THERE IS NO PROVISION IN THE ACT UNDER WHICH TH E INCOME OF THE ASSESSEE IS EXEMPTED. AFTER DETAILED DISCUSSION , HE HAS MADE VARIOUS DISALLOWANCES AND ADDITIONS AND THE IN COME OF THE ASSESSEE WAS ASSESSED AT RS.125,06,25,920/- AS AGAINST REVISED RETURN OF INCOME OF RS.94,77,92,579/-. 5. THE LD. CIT (A) HAS CONFIRMED ALL THE ADDITIONS INCLUDING THE CLAIM OF BENEFIT U/S.11 TO 13. 6. ON PERUSAL OF THE ORDER OF THE TRIBUNAL FOR ASSE SSMENT YEAR 2009-10, WE FIND THAT SIMILAR ISSUES WERE INVO LVED IN THAT YEAR ALSO INCLUDING THE CLAIM OF EXEMPTION U/S.11 T O 13. THE TRIBUNAL HAS REMANDED BACK THESE ISSUES TO THE FILE OF THE ASSESSING OFFICER AFTER OBSERVING AND HOLDING AS UN DER: 14. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF TH E AUTHORITIES BELOW AND HAVE ALSO GONE THROUGH THE DECISION OF TH E COORDINATE BENCH AND THAT OF THE HONBLE HIGH COURT. IT IS AN UNDISPUTED FACT THAT THE PROVISO TO SECTION 2 (15) HAS BEEN MA DE APPLICABLE FROM A.Y. 2009-10. IT IS ALSO NOT IN DISPUTE THAT T HE ASSESSING I.T.AS. NO.4003/DEL/2015 4 OFFICER HAS NOT EXAMINED THIS ISSUE FOR THE YEAR UN DER CONSIDERATION WHILE FRAMING THE ASSESSMENT ORDER. I T IS EQUALLY TRUE THAT THIS ISSUE WAS RAISED FOR THE FIRST TIME BEFORE THE CIT(A) AND IN THE ORDER CIT(A) HAS SIMPLY DRAWN SUPPORT FR OM THE FINDINGS GIVEN IN A.Y. 2007-08 WITHOUT EXAMINING TH E FACTS OF THE ASSESSEE IN THE LIGHT OF THE PROVISO TO SECTION 2 ( 15) OF THE ACT. 15. WE ARE OF THE CONSIDERED VIEW THAT SINCE THE FA CTS ARE NOT CLEARLY COMING OUT FROM THE ORDERS OF THE AUTHORITI ES BELOW, THEREFORE, THE ASSESSMENT HAS TO BE RESTORED TO THE FILES OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION. WE ACCORD INGLY SET ASIDE THE ASSESSMENT TO THE FILES OF THE ASSESSING OFFICER. THE ASSESSING OFFICER IS DIRECTED TO EXAMINE THE ISSUE AFRESH IN THE LIGHT OF THE PROVISO TO SECTION 2 (15) OF THE ACT A FTER GIVING A REASONABLE AND SUFFICIENT OPPORTUNITY OF BEING HEAR D TO THE ASSESSEE. GROUND NO.1 OF ASSESSEES APPEAL IS ALLOW ED FOR STATISTICAL PURPOSE. 16. IN SO FAR AS THE GROUND NO.2 IS CONCERNED THE COUNSEL STATED THAT NO EXEMPT INCOME HAS BEEN EARNED BY THE ASSESSEE, THEREFORE, THERE CANNOT BE ANY DISALLOWANCE U/S. 14 A OF THE ACT. 17. WE FIND THAT WHETHER OR NOT THE ASSESSEE HAS D ERIVED ANY EXEMPT INCOME IS NOT CLEAR FROM THE ASSESSMENT AS W ELL AS THE ORDER OF THE CIT(A), THEREFORE, IN THE INTEREST OF JUSTICE THIS ISSUE IS ALSO SET ASIDE TO THE FILES OF THE ASSESSING OFF ICER. THE ASSESSING OFFICER IS DIRECTED TO EXAMINE THE ISSUE AFRESH AFTER GIVING A REASONABLE OPPORTUNITY OF BEING HEARD TO T HE ASSESSEE. 18. COMING TO THE APPEAL BY THE REVENUE WE FIND THA T THE ISSUES NEED FRESH ADJUDICATION AS DETAILS WERE NEIT HER FURNISHED BY THE ASSESSEE NOR EXAMINED BY THE ASSESSING OFFIC ER, WE ACCORDINGLY SET ASIDE THE ISSUES INVOLVED IN REVENU ES APPEAL TO THE FILES OF THE ASSESSING OFFICER. THE ASSESSEE IS DIRECTED TO I.T.AS. NO.4003/DEL/2015 5 FURNISH ALL THE DETAILS OF EXPENSES AND THE ASSESSI NG OFFICER IS DIRECTED TO EXAMINE THE SAME AND DECIDE THE ISSUES AFRESH. 7. ACCORDINGLY, WE ARE ALSO REMANDING THE ISSUE RAI SED BEFORE US INCLUDING THE CLAIM OF BENEFIT U/S.11 TO 13, AND ALL THE ISSUES ARE KEPT OPEN AND ASSESSEE MAY SUBSTANTIATE ITS CAS E BEFORE THE ASSESSING OFFICER AND FILE ANY DETAILS, EVIDENCES E TC. LD. ASSESSING OFFICER SHALL DECIDE THE ISSUE AFRESH AND IN ACCORDANCE WITH LAW AFTER GIVING DUE AND EFFECTIVE OPPORTUNITY OF HEARING TO THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH FEBRUARY, 2020. SD/- SD/- [DR. B.R.R. KUMAR] [AMIT SHUKLA] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17 TH FEBRUARY, 2020 PKK: