ITO 12(3)(2), MUMBAI V. NEW MAKER CHAMBER IV PREMISES CO-OP SOC. LTD, MUMBAI

ITA 4125/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1960 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2003-2004
• Appeal Filed On: 03-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANADR V ANJANEYULU
• Assessee Lawyers: M SUBRAMANIAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, MUMBAI. BEFORE S/SHRI S.V.MEHROTRA, AM & VIJAY PAL RAO,JM I.T.A NO. 4125/MUM/2009 ASSESSMENT YEAR: 2003-04 THE I.T.O. 12(3)(2), V. NEW MAKER CHAMBER IV PRE MISES AAYAKAR BHAVAN, M.K. ROAD, CO-OPERATIVE SOCIETY LTD., 222, MUMBAI. NARIMAN POINT, MUMBAI-21. PA NO.AAAN 2428 A (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI S.S.RANA/DR V. ANJANEYULU RESPONDENT BY : SHRI M.SUBRAMANIAN O R D E R PER S.V.MEHROTRA, AM THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER DATED 17.4.2009 OF LD CIT (A)-XII, MUMBAI CANCELING THE PENALTY OF RS. 8,39,856/- LEVIED BY THE AO U/S.271(1)(C) FOR THE ASSESSMENT YEAR 2003-04. 2. FACTS ARE THAT THE ASSESSEE IS A CO-OPERATIVE SO CIETY. THE AO HAD LEVIED THE PENALTY U/S.271(1)(C) IN REGARD TO ADDITION OF RS.2 7,90,898/- ON ACCOUNT OF NON- OCCUPANCY CHARGES. LD CIT (A) DELETED THE PENALTY ON THE GROUND THAT THE AO HIMSELF HAD ALLOWED PART OF THE NON-OCCUPANCY CHARGES I.E. 10% OF THE SERVICE/MAINTENANCE CHARGES AS BEING EXEMPT FROM TAX WHICH SHOWED THAT THE NON-OCCUPANCY CHARGES RECEIVED WERE COVERED BY THE PRINCIPLE OF MUTUALITY . HE ALSO REFERRED TO THE DECISION OF ITAT MUMBAI IN THE CASE OF CCI CHAMBERS CO.OP.HSG. SOC. LTD V. ITO, 16 DTR (MUM)334, WHEREIN, IT WAS HELD THAT NON-OCCUPANCY C HARGES SATISFIED THE TEST OF MUTUALITY AND AS SUCH, THE EXCESS AMOUNT COULD NOT BE BROUGHT TO TAX. 2 3. AT THE TIME OF HEARING, LD COUNSEL FOR THE ASSES SEE FILED BEFORE US A COPY OF TRIBUNAL ORDER DATED 23 RD MARCH, 2010 IN ASSESSEES OWN CASE FOR THE ASSESSM ENT YEAR 2003-04 IN QUANTUM APPEAL, WHEREIN, THE TRIBUNAL FO LLOWING THE DECISION IN ITS OWN CASE FOR THE ASSESSMENT YEARS 2002-03 AND 2004-05, HELD THAT NON-OCCUPANCY CHARGES ARE NOT EXIGIBLE TO TAX AND CONSEQUENTLY NON-OCCUPANCY CHAR GES IN EXCESS OF 10% OF THE SERVICE CHARGES CANNOT BE REGARDED AS INCOME CHARGEABLE TO TAX. 4. WE HAVE HEARD BOTH THE SIDES AND HAVE PERUSED TH E RECORD OF THE CASE AS WELL AS THE ORDER OF THE TRIBUNAL DATED 23.3.2010 IN QUANTU M APPEAL (SUPRA). SINCE THE ADDITION IN QUANTUM APPEAL, WHICH WAS THE VERY BASIS OF LEVY ING THE PENALTY, HAS BEEN DELETED BY THE TRIBUNAL, THEREFORE, THE PENALTY ORDER OF ASSES SING OFFICER HAS NO LEGS TO STAND. IN VIEW OF THIS, WE UPHOLD THE ORDER OF LEARNED CIT(A) DELETING THE PENALTY. 5. IN THE RESULT, APPEAL FILED BY THE REVENUE STAND S DISMISSED. PRONOUNCED ON 30 TH APRIL, 2010 SD/- (VIJAY PAL RAO) (JUDICIAL MEMBER) SD/- (S.V. MEHROTRA) (ACCOUNTANT MEMBER) MUMBAI, DATED 30 TH APRIL, 2010 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)XII-, MUMBA I 4. COMMISSIONER OF INCOME TAX, XII-, MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH B, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI 3 DATE INITIALS 1. DRAFT DICTATED ON 28.4.2010 PS 2. DRAFT PLACED BEFORE AUTHOR 28.4.2010 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER AM/JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/J M 5. APPROVED DRAFT COMES TO THE SR. PS PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER 4