Muzaffarnagar Development Authority (MDA), Muzaffarnagar V. DCIT, Muzaffarnagar

ITA 4016/DEL/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2824 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 1 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2011-2012
• Appeal Filed On: 13-07-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 40(a)(ia); 12A; 12AA; 251; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E: DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI B.R.R. KUMAR, ACCOUNTANT MEMBER ITA.NO.4016/DEL./2016 ASSESSMENT YEAR 2011-2012 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY [MDA], MEERUT ROAD, MUZAFFARNAGAR. [U.P.] PIN 251 002. PAN AAALM0437D VS., THE DCIT, CIRCLE -1 MUZAFFARNAGAR. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI C.S. ANAND, C.A. FOR REVENUE : MS. RINKU SINGH, SR. D.R. DATE OF HEARING : 14.08.2019 DATE OF PRONOUNCEMENT : 02.09.2019 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A), MUZAFFARNAGAR, DATED 15.03.2016 FOR THE A.Y. 2011-2012, ON THE FOLLOWING GROUNDS : 2 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . 1. HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT (A) HAS ERRED BOTH, IN LAW AN D ON FACTS, IN NOT ADMITTING AND ADJUDICATING THE FOLLOWING ADDITIONAL GROUND OF APPEAL - HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF TH E CASE AND UNDER LAW, THE ASSESSEE IS ENTITLED TO CLA IM THE BENEFIT/EXEMPTION UNDER SECTION 11 OF THE INCOME TA X ACT,1961 BECAUSE THE HONBLE ITAT-DELHI, VIDE ITS ORDER DATED 12.01.2015 IN ITA NO. 4231/DEL/2013, HA S RESTORED THE REGISTRATION GRANTED TO THE ASSESSEE U NDER SECTION 12AA OF THE ACT. 2. IN ANY VIEW OF THE MATTER AND IN ANY CASE, THE DECISION OF THE LEARNED CIT (A), IN NOT ADMITTING A ND ADJUDICATING THE ADDITIONAL GROUND OF APPEAL RAISED BEFORE HIM DURING THE APPELLATE PROCEEDINGS, IS BAD IN LAW AND IS AGAINST THE FACTS AND CIRCUMSTANCES O F THE CASE BECAUSE IT IS NECESSARY TO BE ADJUDICATED IN ORDER TO ASSESS THE CORRECT INCOME OF THE ASSESSEE. 3 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . 3. THE ASSESSEE PRAYS TO BE ALLOWED THE PERMISSION TO SUBMIT FURTHER EVIDENCE / JUDGMENTS / WRITTEN SUBMISSIONS AT THE TIME OF HEARING BEFORE THE HONB LE BENCH OF ITAT. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT AS PER ASSESSMENT ORDER ASSESSEE IS A LOCAL AUTHORITY AND NATURE OF BUSINESS IS PLANNING, DEVELOPMENT AND IMPROVEMEN T OF CITY ETC., THE ASSESSEE FILED RETURN OF INCOME DECL ARING INCOME OF RS.2.39 CRORES. AT THE ASSESSMENT PROCEED INGS, A.O. DISALLOWED RS.7,11,765/- UNDER SECTION 40(A)(I A) OF THE INCOME TAX ACT FOR NOT DEDUCTING THE TAX AT SOURCE. THE A.O. ALSO ADDED RS.4,81,115/- BECAUSE IMPUGNED AMOU NT WAS OUTSTANDING SINCE LAST THREE YEARS OR MORE AND THERE WAS NO CHANCE OF REFUND OF THE AMOUNT. THEREFORE, I T WAS TREATED AS INCOME OF THE CURRENT YEAR. THE ADDITION WAS ACCORDINGLY MADE. 3. THE ASSESSEE CHALLENGED BOTH THE ADDITIONS BEFO RE THE LD. CIT(A). THE LD. CIT(A) CONFIRMED THE ADDITI ON OF RS.80,890/- UNDER SECTION 40(A)(IA) OF THE INCOME T AX ACT. 4 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . THIS GROUND WAS PARTLY ALLOWED. THE LD. CIT(A), HOW EVER, DELETED THE ADDITION OF RS.4,81,115/-. THE ASSESSEE ALSO FILED APPLICATION FOR ADMISSION OF THE ADDITIONAL G ROUND OF APPEAL SUBMITTING THEREIN THAT ASSESSEE GRANTED REG ISTRATION UNDER SECTION 12AA OF THE I.T. ACT WHICH WAS SUBSEQ UENTLY CANCELLED BY THE LD. CIT, AGAINST WHICH, ASSESSEE P REFERRED AN APPEAL BEFORE THE TRIBUNAL IN ITA.NO.4231/DEL./2 013 WHICH IS DECIDED VIDE ORDER DATED 12.01.2015 AND AP PEAL OF ASSESSEE HAS BEEN ALLOWED, MEANING THEREBY, REGISTR ATION OF ASSESSEE HAVE BEEN RESTORED. THE LD. CIT(A), HOWEVE R, DID NOT ADMIT THE ADDITIONAL GROUND OF APPEAL BECAUSE T HE ISSUE OF CLAIM OF EXEMPTION WAS NOT ORIGINATING FROM THE ORDER OF THE A.O. THE ADDITIONAL GROUND, THEREFORE, WAS NOT ADMITTED AND APPEAL OF ASSESSEE WAS PARTLY ALLOWED. 4. LEARNED COUNSEL FOR THE ASSESSEE APART FROM RAISING THE ABOVE GROUNDS OF APPEAL ALSO RAISED ADD ITIONAL GROUND OF APPEAL BEFORE THE TRIBUNAL WHICH READS AS UNDER: ON THE FACTS OF THE CASE AND UNDER THE LAW, THE BE NEFIT /EXEMPTION UNDER SECTION 11/12 OF THE I.T. ACT 1961 BE 5 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . ALLOWED TO THE ASSESSEE AND ACCORDINGLY, THE TOTAL INCOME OF THE ASSESSEE FOR A.Y. 2011-12 BE RECOMPUT ED AT NIL (AS PER REVISED COMPUTATION OF INCOME READ W ITH ITS VARIOUS ENCLOSURES, WHICH WERE FILED DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE THE COMMISSIONER APPEALS). 4.1. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED TH AT SINCE REGISTRATION UNDER SECTION 12A EXIST IN FAVOU R OF THE ASSESSEE AND IS IN OPERATION, THEREFORE, INCOME OF ASSESSEE IS TO BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF SECTIONS 11 AND 12 OF THE I.T. ACT, 1961. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT ADDITIONAL GROUND IS LEGAL IN NATURE AND SHALL HAVE TO BE ADMITTED. WE, THEREFORE, ADMIT THE ADDIT IONAL GROUND OF APPEAL. 6. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT THE MATTER REQUIRES RECONSIDERATION A T THE LEVEL OF THE LD. CIT(A), MUZAFFARNAGAR. IN THE AFOR ESAID CASE REGISTRATION UNDER SECTION 12AA WAS GRANTED TO THE ASSESSEE 6 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . WHICH WAS SUBSEQUENTLY CANCELLED UNDER SECTION 12AA (3) OF THE I.T. ACT. THE ITAT, HOWEVER, ALLOWED THE APPEAL OF ASSESSEE CANCELLING THE ORDER UNDER SECTION 12AA(3) OF THE I.T. ACT. THE TRIBUNAL RESTORED THE REGISTRATION UN DER SECTION 12AA OF THE I.T. ACT. IT, THEREFORE, STANDS PROVE ON RECORD THAT REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT EXIST AND CONTINUE IN FAVOUR OF THE ASSESSEE. SINCE REGISTRATION UNDER SECTION 12AA OF THE I.T. ACT EXI ST IN THE CASE OF ASSESSEE, THEREFORE, INCOME OF THE ASSESSEE SHALL HAVE TO BE COMPUTED WITH REFERENCE TO THE PROVISION S OF SECTIONS 11 AND 12 OF THE I.T. ACT. THEREFORE, THER E WAS NO JUSTIFICATION FOR THE LD. CIT(A) TO REJECT THE ADDI TIONAL GROUND OF APPEAL RAISED BEFORE HIM. IN VIEW OF THE ABOVE, WE SET ASIDE THE ORDER OF THE LD. CIT(A) IN REFUSING T O ADMIT THE ADDITIONAL GROUND OF APPEAL. THE ADDITIONAL GROUND RAISED BEFORE THE TRIBUNAL IS, THEREFORE, ADMITTED. 6.1. IN VIEW OF THE FACTS AND CIRCUMSTANCES, WE SE T ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTO RE THE MATTER IN ISSUE TO THE FILE OF THE LD. CIT(A) WITH A DIRECTION TO RE-DECIDE THE ADDITIONAL GROUND RAISED BEFORE HI M AS WELL 7 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . AS ADDITIONAL GROUND OF APPEAL ADMITTED BY US AT TH IS STAGE. THE LD. CIT(A) SHALL GIVE REASONABLE, SUFFICIENT OP PORTUNITY OF BEING HEARD TO THE ASSESSEE. 7. IN THE RESULT, APPEAL OF ASSESSEE ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (B.R.R. KUMAR) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 02 SEPTEMBER, 2019 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT E BENCH 6. GUARD FILE //BY ORDER// ASST. REGISTRAR : ITAT : DELHI BENCHES : DELHI. 8 ITA.NO.4016/DEL./2016 MUZZAFFARNAGAR DEVELOPMENT AUTHORITY, MUZAFFARNAGAR. . DATE OF DICTATION 14.08.2019 DATE ON WHICH THE TYPED DRAFT ORDER IS PLACED BEFOR E THE DICTATION MEMBER 14.08.2019 DATE ON WHICH THE APPROVAL DRAFT COMES TO THE SR. P S 02.09.2019 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATION MEMBER FOR PRONOUNCEMENT 02.09.2019 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S. 02.09.2019 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 02.09.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 02. 09.2019 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER.