Cane Development Council (Ganna Vikas Parishad), GONDA V. Income Tax Officer, GONDA

ITA 567/LKW/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1129 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 4 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 21-09-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: BHARAT AWASTHI
• Keywords: Condonation of delay
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW SMC BENCH, LUCKNOW BEFORE SHRI S UNIL KUMAR YADAV , JUDICIAL MEMBER ITA NO. 567/LKW/2016 ASSESSMENT YEAR: 2010 - 11 CANE DEVELOPMENT COUNCIL (GANNA VIKAS PARISHAD) MANKAPUR, GONDA V. INCOME TAX OFFICER GOND A PAN: AAALC0566B (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SHRI BHARAT AWASTHI, D.R. DATE OF HEARING: 15 02 2018 DATE OF PRONOUNCEMENT: 16 02 2018 O R D E R THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A), INTER ALIA, ON THE FOLLOWING GROUNDS: - 1. THAT THE COMMISSIONER OF INCOME TAX APPEAL - II, LUCKNOW COMMITTED MANIFEST ERROR OF LAW IN REJECTING THE FIRST APPEAL OF THE APPELLANT WITHOUT APPRECIATING FACTS AND CIRCUMSTANCES OF THE CASE OF THE APPELLANT. 2. THAT THE APPELLANT IS A ARTIFICIAL JUDICIAL PERSON AND FILED THE RETURN, TOTAL INCOME NIL A S IT HAS NO INCOME IT IS A SEMI GOVERNMENT BODY OF THE STATE GOVERNMENT FUNCTIONING UNDER ITS GANNA VIBHAG. THE APPELLANT IS NOT DOING ANY BUSI NESS OF ACTIVITY WITH PROFIT EARNING MOTIVE. IT HAS BEEN FORMED FOR CARRYING OUT SUGAR CANE DEVELOPMENT PROGRAMMES /SCHEMES OF THE STATE GOVERNMENT LIKE, CONSTRUCTION OF ROAD, CULVERT ETC IN THE ASSIGNED AREA/ZONE, TO WORK FOR PRODUCTION OF BETTER QUALITY OF SUGAR CANE, SEEDS AND ALSO TO PROVIDE NECESSARY INFRASTRUCTURE TO THE SUGAR CANE GROWERS, ETC. THE APPELLANT IS A SERVICE ORGAN OF THE STATE GOVERNMENT FORMED FOR CARRYING OUT THE DESIRED DEVELOPMENT PRORARRIM.ES OF : - 2 - : THE STATE GOVER NMENT FOR AND ON ITS BENEFIT FOR EXECUTING THE SAID DEVELOPMENT PROGRAMME, THE APPELLANT RECEIVED FUND BY WAY OF GRANT FROM THE STATE GOVERNMENT AND BY WAY OF DEVELOPMENT COMMISSION FROM THE SUGAR MILL ON ORDER AND DIRECTION OF THE STATE GOVERNMENT , THESE FUNDS RECEIVED ARE ONLY THE 'RECEIPT' AND NOT THE IN COME OF APPELLANT, THESE FUND A RE RECEIVED FROM FOR AND ON BEHALF OF THE STATE GOVERNMENT FOR INCURRING EXPENDITURE ON DE VELOPMENT PROGRAMMES AS DESIRED BY THE STATE GOVERNMENT IN THE ASSIGNE D AREA/ZONE. THESE FUND ARE SPENT FOR THE ABOVE MENTIONED ACTIVITIES DURING THE YEAR AND IF ANY AMOUNT REMAINS; UNSPENT DURI NG THE YEAR DUE TO THE REASON T HAT THE PROJECT UNDER TAKEN IS STILL I N PROGRESS, IT IS SPENT IN THE NEXT YEAR(S) ON THAT PROJECT . TH E APPELLANT HOLD THE FUNDS RECEIVED FOR AND ON THE BEHALF OF STATE GOVERNMENT FOR THE SAID SPECIFIC PURPOSE, THE APPELLANT SIMPLY ADMINISTERS THE FUNDS PLACED AT ITS DISPOSAL AND DISCHARGES IT DUTIES WITH REGARD TO IT AS DIREC T ED BY THE STATE GOVERNMENT IT CANNOT UTILIZE THE FUNDS ACCORDING TO ITS SWEET WILL OR ANY HEAD OR ANY ITEM NOT DIRECTED OR DESIRED BY THE STATE GOVERNMENT. THE EXCESS OF THE RECEI PTS OVER EXPENDITURE DURING PARTICULAR YEAR ALSO DOES NOT BELONG TO THE APPE LLANT OR TO ANY OTHER PERSONS AS OWNER BUT IT IS HELD BY THE APPELLANT FOR EXPENDITURE ON CARRYING OUT THE SAME DEVELOPMENT PROGRAMM E IN THE NEXT YEAR/YEARS FOR AND ON THE BEHALF OF THE STATE GOVERNMENT. IN THE CASE THE APPELLANT IS BOUND UP THE, SURPLUS A MOUNT ALONG WITH ! ALL THE ASSETS ETC WILL REVER T BACK TO THE STATE 'GOVERNMENT AND TO ANY OTHER PERSON/PERSONS AS OWNER, HENCE THE FUNDS WHICH THE APPELLANT RECEIVES ARE NOT INCOME OF THE APPELLANT BUT THESE A RE THE RECEIPTS HELD FOR AND ON BEHALF OF THE STATE GOVERNMENT. IN FACT THESE RECEIPTS OR ANY SURPLUS OUT OF IT AFTER THE EXPENDITURE DURING A PARTICULAR YEAR IS UNDERCHARGED LIABILITY OF THE APPELLANT WHICH IS DISCHARGED IN THE NEXT YEAR. MOR E OVER, AS PER R ECEIPT AND EXPENDITURE STATEMENT FILED DURING COURSE OF HEARING OF ASSESSMENT PROCEEDINGS FOR THE YEAR, THERE HAS BEEN NO SURPLUS BUT A DEFICIT (LOSS) OF R S. 1353614/ - BUT THE LEARNED A.O. HAS WRONGLY TREATED IT AS A SURPLUS (PROFIT) OVER EXPENDITURE DURING THE YEAR AND HAS ADDED IT IN THE DISCLOSED TOTAL INCOME TREATING IT AS INCOME OF THE APPELLANT, IN THIS WAY, HE HAS WRONGLY : - 3 - : COMPLETED THE ASSESSMENT ON TOTAL INCOME OF RS. 1353614/ - BEING AGGRIEVED BY THE ORDER THE APPEAL IS PREFERRED BEFORE THE CIT, APPE AL, MEERUT ON 30.01.2009 FROM THE ORDER OF RTO WARD 2(1), MEERUT. BUT THE CIT APPEAL IS REJECTED. 3. THE APPELLANT PLACED THE RELIANCE ON THE JUDGMENT ON THE HON'BLE ITAT, DELHI 'C BENCH DELHI (ORDER DATED 04.04.2012) IN ITA NO. 1541/DEL/2008 FOR AY 06 - 07 IN THE CASE OF N.S. COMMITTEE, THANABHUWAN DISTT. MUZAFFAR NAGAR, DISTRICT MUZAFFAR NAGAR WHICH WAS ALSO ESTABLISHED UNDER SECTION 5 OF THE U.P. SUGAR CANE (REGULATION OF SUPPLY & PURCHASE) ACT, 1953 MADE AS EXPENDITURE OUT OF THE SAID GROSS RECEIPTS OF COMMISSION SHOULD BE ALLOWED AS DEDUCTION WHILE WORKING OUT THE PROFIT AND ANOTHER CASE RELIANCE IS PLACED ON THE JUDGMENT OF THE HON'BLE TAT IN THE CASE OF ADDL. CIT VS. N.S. COMMITTEE MUZAFFAR NAGAR ITA NO.L541/DEL/2008 AY - 2006 - 07 (ORDER DATED 04.04.2012) IN WHICH IT HAS BEEN HELD THAT WE HAVE HEARD THE SECTION 2(24) OF THE ACT IT IS DECLARE THAT 'INCOME INCLUDES' VARIOUS ITEM WHICH ARE ENUMERATED THER E IN CLAUSE (I) TO (XV), IN THE SAID SECTION 2(24) SUCH A GRANT - IN - AID HAS NOT BEEN SPECIF ICALLY INCLUDED AS AN INCOME OR A REVENUE RECEIPT. 4. THAT THE TOTAL RECEIPTS AND ANY SURPLUS OUT OF IT DURING THE YEAR IS NOT THE RECEIPT OF 'INCOME' NATURE OF THE APPELLANT HENCE IT IS NOT CHARGEABLE TO TAX UNDER INCOME TAX ACT, 1961. 5. THAT TH E ADDITIONAL MADE TO DISCLOSED T.I. IS BASELESS, ARBITRARY AND UNJUSTIFIED. 6. THAT, CONSIDERING THE WHOLE FACTS AND CIRCUMSTANCES OF THE CASE, THE ADDITION MADE AT RS. 40,21,760/ - DESERVES TO BE DELETED. 7. THAT THE LEVY OF INTEREST U/S 234A, 234 B ARID 234C IS ILLEGAL AND UNJUSTIFIED. THE APPELLANT IS NOT LIABLE TO THESE INTEREST. 8. THAT THE ORDER OF COMMISSIONER INCOME TAX (APPEAL - II), LUCKNOW DATED 08.10.2013 PASSED IN APPEAL NO.08/132/ITO/GONDA/2012/13 IS LIABLE TO BE QUASHED AND FURTHER DEMAND OF RS. 18,00,700/ - UNDER SECTION 144 ISSUED BY ITO, GONDA MAY ALSO BE QUASHED OTHERWISE THE APPELLANT SHALL SUFFER IRREPARABLE LOSS AND INJURY. : - 4 - : 09. THAT THE ORDER OF CIT (APPEAL - II) LUCKNOW DATED 08.10.2013 WAS SERVED ON THE APPELLANT ON 07. 09.201 6 AND AS SUCH TH E PRESENT APPEAL IS LATE BY 1000 = DAY. 10. THAT THE APPELLANT CRAVES LEAVES TO AID OR AMEND THE GROUND OF APPEAL DURING THE COURT OF HEARING BEFORE HON'BLE IT APPELLATE TRIBUNAL. 2 . IN THIS APPEAL THERE IS A DELAY OF 953 DAYS IN FILING OF APPEAL, FOR WHICH APPLICATION FOR CONDONATION OF DELAY IS ALSO FILED STATING THEREIN THAT THE ORDER OF THE LD. CIT(A) WAS MISPLACED AND LATER ON IT WAS TRANSPIRED FROM THE INCOME TAX DEPARTMENT THAT A DEMAND PENDING AGAINST THE SAID ORDER WAS ADJUSTED AGAI NST THE REFUND OF THE ASSESSEE. IN SUPPORT OF THESE CONTENTIONS, NO EVIDENCE IS PLACED ON RECORD. 3 . THIS APPEAL CAME UP FOR HEARING ON 15/2/2018 BUT NONE APPEARED ON BEHALF OF THE ASSESSEE. ON A CAREFUL PERUSAL OF THE APPLICATION FOR CONDONATION OF DELAY, WE FIND THAT ADMITTEDLY THE ORDER OF THE LD. CIT(A) WAS SERVED UPON THE ASSESSEE AND ASSESSEE OUGHT TO H AVE VIGILANT ABOUT ITS RIGHTS AND THE APPEAL WAS NOT FILED IN TIME. THE REASONS STATED IN THE CONDONATION APPLICATION ARE NOT PLAUSIBLE AND I DO NOT FI ND MERIT THEREIN. ACCORDINGLY, I REJECT THE APPLICATION FOR CONDONATION OF DELAY AND THEREFORE THE APPEAL IS BARRED BY LIMITATION AND IS DISMISSED BEING NOT ADMITTED. 4 . IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISSED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION ED PAGE. SD/ - [ S UNIL KUMAR Y ADAV ] JUDICIAL MEMBER DATED: 16 TH FEBRUARY , 201 8 JJ: 1502 : - 5 - : COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR