ITO, Panchkula V. M/s Panchkula Golf Club, Panchkula

ITA 533/CHANDI/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5143 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 09-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Capital receipt

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO.533/CHD/2016 (ASSESSMENT YEAR : 2012-13) THE INCOME TAX OFFICER, VS. M/S PANCHKULA GOLF CLUB, WARD-3, PANCHKULA. SECTOR-3, PANCHKULA. PAN: AAAAP5757C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANJIT SINGH RESPONDENT BY : SHRI MANOJ KUMAR DATE OF HEARING : 27.04.2017 DATE OF PRONOUNCEMENT : 19.05.2017 O R D E R PER SANJAY GARG, JUDICIAL MEMBER : THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENUE AGAINST THE ORDER DATED 17.2.2016 OF COMMIS SIONER OF INCOME TAX (APPEALS)-2, GURGAON (HEREINAFTER REF ERRED TO AS CIT (A)) RELATING TO ASSESSMENT YEAR 2012-13. 2. THE APPEAL IS TIME BARRED BY SIX DAYS. AN APPLICATION ON BEHALF OF THE DEPARTMENT HAS BEEN MO VED FOR CONDONATION OF DELAY. IN VIEW OF THE REASONS MENTI ONED IN THE APPLICATION AND ALSO CONSIDERING THE SHORTNESS OF THE PERIOD OF DELAY, THE DELAY IN FILING THE PRESENT AP PEAL IS HEREBY CONDONED. 3. NOW COMING TO THE MERITS OF THE APPEAL, THE REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPEAL: 2 ON THE FACTS IN THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN HOLDING THAT THE ASSESSEE C LUB IS A MUTUAL CONCERN DISREGARDING THE FINDINGS OF THE AO THAT THE FINANCIAL AND ADMINISTRATIVE CONTROL OVER T HE ASSESSEE CLUB IS IN THE HAND OF HUDA AND THAT THERE IS NO COMPLETE EQUALITY BETWEEN THE CONTRIBUTORS OF THE CLUB. IT IS PRAYED THAT THE ORDER OF THE LD. CIT (APPEAL) BE SET-ASIDE AND THAT OF THE A.O. BE RESTORED. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROU NDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED O FF. 4. THE SOLE ISSUE RAISED IN THIS APPEAL IS AS TO WHETHER THE ASSESSEE IS TO BE TREATED AS MUTUAL CON CERN OR NOT. BRIEF FACTS RELATING TO THE ISSUE ARE THAT TH E ASSESSEE CLUB IS A SOCIETY REGISTERED UNDER THE SOCIETY REGI STRATION ACT 21 OF 1860 WITH THE REGISTRAR OF THE SOCIETY HA RYANA. THE ASSESSEE HAD FILED ITS RETURN IN THE STATUS AS AOP. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESS ING OFFICER NOTED THAT THE ASSESSEE HAD RECEIVED A SUM OF RS.93,22,412/- AS CONTRIBUTION FROM THE MEMBERS WHI CH WAS CLAIMED BY THE ASSESSEE AS A CAPITAL RECEIPT ON THE BASIS OF MUTUALITY. THE ASSESSING OFFICER HELD THAT THE ASSE SSEE DID NOT FULL FILL THE OBJECTIVE OF THE MUTUAL CONCERN A ND, THEREFORE, COULD NOT BE ACCEPTED AS MUTUAL CONCERN. THE CONTRIBUTION OF RS.93,22,412/- WAS HELD TO BE INCOM E OF THE ASSESSEE. AGAINST THIS INCOME, THE APPLICATION OF INCOME WAS ALLOWED AND THE TOTAL INCOME WAS COMPUTED AT NI L. 5. BEING AGGRIEVED BY THE ABOVE ACTION OF THE ASSESSING OFFICER IN NOT TREATING THE ASSESSEE AS A MUTUAL 3 CONCERN, THE ASSESSEE PREFERRED APPEAL BEFORE THE L D. CIT(A). THE LD. CIT(A) ALLOWED THE APPEAL OF THE ASSESSEE B Y OBSERVING THAT THE ISSUE HAS ALREADY BEEN DEALT BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR ASSESSMENT YEAR 2008-09 IN ITA NO.813/CHD/2013 VIDE ORDER DATED 6.5.2015. THE LD. CIT(A) REPRODUCING T HE CONCLUSION PART OF THE ORDER, OBSERVED THAT THE TRI BUNAL HAS ALREADY CONSIDERED THE ISSUE AND HELD THAT THE ASSE SSEE WAS ENTITLED TO EXEMPTION UNDER THE CONCEPT OF MUTUALIT Y AND THE ENTRANCE FREE HAS TO BE TREATED AS CAPITAL FEE RECE IVED FROM THE MEMBERS AND HAS TO BE ALLOWED FOR EXEMPTION UND ER THE CONCEPT OF MUTUALITY. 6. THE LD. AR HAS FURTHER PRODUCED BEFORE US COPY OF THE ORDER DATED 19.1.2017 PASSED IN ITA NO.1190/CHD /2016 FOR ASSESSMENT YEAR 2010-11 AND SUBMITTED THAT THE ORDER DATED 6.5.2015 OF THE TRIBUNAL PASSED IN ITA NO.813/CHD/2013 (SUPRA) HAS BEEN FURTHER FOLLOWED B Y THE TRIBUNAL IN THE SAID ITA NO.1190/CHD/2016 (SUPRA). 7. WE FIND THAT THE ISSUE HAS ALREADY BEEN DECIDED IN THE OWN CASE OF THE ASSESSEE FOR ASSESSMENT YEAR 20 08-09. THE LD. CIT(A) HAS FOLLOWED THE ORDER OF THE TRIBUN AL WHILE ALLOWING THE APPEAL OF THE ASSESSEE. THE LD. DR C OULD NOT BRING ANY CONTRARY DECISION TO THE SAID FINDINGS OF THE TRIBUNAL ARRIVED AT IN THE OWN CASE OF THE ASSESSEE . THE SAID ORDER OF THE TRIBUNAL DATED 6.5.2015 ON THIS I SSUE HAS BEEN FURTHER FOLLOWED IN THE OWN CASE OF THE ASSESS EE FOR ASSESSMENT YEAR 2010-11 ALSO, AS DISCUSSED ABOVE. WE DO 4 NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT( A) IN FOLLOWING THE ORDER OF THE TRIBUNAL ON THIS ISSUE. UNDER THESE CIRCUMSTANCES, THERE IS NO MERIT IN THE APPEA L OF THE REVENUE AND THE SAME IS ACCORDINGLY, DISMISSED. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 19.5.2017. SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 19 TH MAY, 2017 *RATI* COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. THE CIT 5. THE DR ASSISTANT REGISTRAR, ITAT, CHANDIGARH