Krishi Upaj Mandi Samiti, JETSAR V. ITO, SURATGARH

ITA 603/JODH/2013

• Counselvise Citation: 60323314 RSA 2013
• Duration Of Justice: 1 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Next Hearing Date: 24-02-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 27-12-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Assessee Lawyers: RAKESH GUPTA
• Keywords: Charitable institution; Revised return

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO.08/JODH/2014 (A.Y. 2008-09) ITO, SURATGARH. VS. M/S. KRISHI UPAJ MANDI SAMITI, GHARSANA. PAN NO. AABTK 0466 B (APPELLANT) (RESPONDENT) ITA NO.602/JODH/2013 (A.Y. 2008-09) M/S. KRISHI UPAJ MANDI SAMITI, VS. ITO, SURATGARH . GHARSANA. PAN NO. AABTK 0466 B (APPELLANT) (RESPONDENT) ITA NO.605/JODH/2013 (A.Y. 2008-09) M/S. KRISHI UPAJ MANDI SAMITI, VS. ITO, SURATGARH . ANOOPGARH. PAN NO. AABTK 0476 H (APPELLANT) (RESPONDENT) 2 ITA NO.10/JODH/2014 (A.Y. 2008-09) ITO, SURATGARH. VS. M/S. KRISHI UPAJ MANDI SAMITI, ANOOPGARH. PAN NO. AABTK 0476 H (APPELLANT) (RESPONDENT) ITA NO.604/JODH/2013 (A.Y. 2008-09) M/S. KRISHI UPAJ MANDI SAMITI VS. ITO, SURATGARH. RAWLA. PAN NO. AABTK 0437 C (APPELLANT) (RESPONDENT) ITA NO.13/JODH/2014 (A.Y. 2008-09) ITO, SURATGARH. VS. M/S. KRISHI UPAJ MANDI SAMITI, RAWLA. PAN NO. AABTK 0437 C (APPELLANT) (RESPONDENT) ITA NO.603/JODH/2013 (A.Y. 2008-09) M/S. KRISHI UPAJ MANDI SAMITI VS. ITO, SURATGARH. JETSAR. PAN NO. AABTK 0475 E (APPELLANT) (RESPONDENT) 3 ITA NO.15/JODH/2014 (A.Y. 2008-09) ITO, SURATGARH. VS. M/S. KRISHI UPAJ MANDI SAMITI, JETSAR. PAN NO. AABTK 0475 E (APPELLANT) (RESPONDENT) ITA NO.606/JODH/2013 (A.Y. 2008-09) M/S. KRISHI UPAJ MANDI SAMITI VS. ITO, SURATGARH. SRIBIJAYNAGAR. PAN NO. AABTK 0474 F (APPELLANT) (RESPONDENT) ITA NO.17/JODH/2014 (A.Y. 2008-09) ITO, SURATGARH. VS. M/S. KRISHI UPAJ MANDI SAMITI, SRIBIJAYNAGAR. PAN NO. AABTK 0474 F (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RAKESH GUPTA DEPARTMENT BY : SHRI N.A. JOSHI- D.R. DATE OF HEARING : 24/02/2014. DATE OF PRONOUNCEMENT : 24/02/2014. 4 O R D E R PER N.K. SAINI, A.M THESE CROSS APPEALS BY THE ASSESSEES AND THE DEPAR TMENT ARE DIRECTED AGAINST THE SEPARATE ORDERS EACH DATED 25/ 10/2013 OF LD. CIT(A), BIKANER. SINCE, THE APPEALS INVOLVING SIMI LAR FACTS AND IDENTICAL ISSUES WERE HEARD TOGETHER, SO, THESE ARE BEING DIS POSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2 FIRST WE WILL DEAL WITH THE CROSS APPEALS RELATING TO KRISHI UPAJ MANDI SAMITI, GHARSANA IN I.T.A.NO. 08/JODH/2014 & 602/JODH/2013. THE ONLY GROUND RAISED IN THE DEPARTMENTAL APPEAL I N I.T.A.NO. 08/JODH/2014 READS AS UNDER:- ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) HAS ERRED IN ALLOWING RELIEF OF RS. 22,61,200/- OUT OF PENALTY OF RS. 56,90,500/- IMPOSED U/S 271(1)(C) OF THE I.T. ACT, 1961. THE GROUNDS RAISED IN THE ASSESSEES APPEAL IN I.T. A.NO. 602/JODH/2013 ARE AS UNDER:- 1. THE LD. CIT(A) ERRED IN SUSTAINING THE PENALTY IMPOSED U/S 27(1)(C) OF THE I.T. ACT, 1961 EVEN WHEN THE MAIN GROUND OF QUA NTUM APPEAL ARE SET ASIDE TO THE LD. CIT(A) FOR FRESH ADJUDICATION. 2. THE APPELLANT RESERVES THE RIGHT TO ADDITION OR AMEND ANY GROUND OF APPEAL ON OR BEFORE THE HEARING OF APPEAL. 5 3. FROM THE ABOVE GROUNDS, IT IS CLEAR THAT ONLY GRIE VANCE OF THE DEPARTMENT AND THE ASSESSEE RELATES TO THE DELETION /SUSTENANCE OF THE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER SECTI ON 271(1)(C) OF THE I.T. ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT IN SHORT). 4. FACTS OF THE CASE IN BRIEF ARE THAT THE INCOME OF THE ASSESSEE WAS EXEMPTED UNDER SECTION 10(20) OF THE ACT UP TO A.Y. 2002-03. THEREAFTER, AN AMENDMENT WAS MADE IN SECTION 10(20) OF THE ACT BY THE FINANCE ACT, 2002 AND THE INCOME OF THE ASSESSEE BE CAME TAXABLE. THE ASSESSEE HAD APPLIED FOR REGISTRATION UNDER SECTION 12(A) OF THE ACT TO THE LD. CIT, BIKANER AND GOT THE SAME FROM HIM. THE AS SESSEE FILED RETURN OF INCOME ON 26/09/2008 AND REVISED RETURN ON 29/09/20 09 CLAIMING ITS STATUS AS CHARITABLE TRUST. THE ASSESSEE HAD INCUR RED EXPENDITURE OF RS. 83,56,472/- DURING THE YEAR AND CLAIMED THE SAM E AS APPLICATION OF ITS INCOME AGAINST GROSS RECEIPT OF RS. 1,84,92,278/-. THE ASSESSING OFFICER, HOWEVER, DISALLOWED A SUM OF RS. 1,11,61,214/- AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. ACCORDINGLY, INCOME OF THE ASSESSEE WAS ASSESSED AT RS. 1,11,61,214/- AS AGAINST THE NIL IN COME DECLARED. AGAINST THE SAID ADDITION MADE BY THE ASSESSING OFFICER, TH E ASSESSEE PREFERRED AN APPEAL TO THE LD. CIT(A), BIKANER, WHO HAD UPHEL D THE DECISION OF THE ASSESSING OFFICER. BEING AGGRIEVED, THE ASSESSEE P REFERRED AN APPEAL TO 6 THE ITAT, JODHPUR BENCH, JODHPUR IN I.T.A.NO. 406/J U/2011 WHEREIN FOLLOWING GROUNDS WERE RAISED:- 1) THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS. 1,01,35,806/- TO THE TOTAL INCOME OF THE ASSESSEE U/S 11(1) OF TH E INCOME TAX ACT, 1961. 2) THE LD. CIT(A) ERRED IN NOT ALLOWING EXEMPTION O F APPLICATION OF INCOME OF 15% OF GROSS RECEIPTS I.E. RS. 27,73,744/ - 3) THE LD. CIT(A) ERRED BY NOT ALLOWING SETOFF OF A CCUMULATED EXCESS OF EXPENDITURE OVER INCOME OF EARLIER YEARS AGAINST SURPLUS OF CURRENT YEAR. 4) THE LD. CIT(A) ERRED IN NOT ALLOWING AMOUNT DEEM ED TO BE APPLIED DURING THE PREVIOUS YEAR AS PER CLAUSE(2) OF THE EX PLANATION TO SECTION 11(1) RS. 28,87,708/- 5) THE LD. CIT(A) ERRED IN SUSTAINING THE ADDITION OF RS. 10,25,408/- TO THE TOTAL INCOME OF THE ASSESSEE. THE ITAT VIDE ORDER DATED 18/12/2012 ALLOWED THE A FORESAID GROUND NO.3 IN FAVOUR OF THE ASSESSEE AND THE REMAINING GR OUNDS WERE SET ASIDE TO THE FILE OF THE LD. CIT(A) FOR FRESH ADJUDICATIO N. IN THE MEANWHILE, THE ASSESSING OFFICER IMPOSED PENALTY OF RS. 56,90,500/ - UNDER SECTION 271(1)(C) OF THE ACT. 5. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER T O THE LD. CIT(A), WHO HAD ALLOWED RELIEF IN PENALTY TO THE EXTENT OF ADDITIONS DELETED BY THE ITAT IN QUANTUM APPEAL AND CONFIRMED THE PENALT Y UNDER SECTION 271(1)(C) OF THE ACT ON REMAINING ADDITIONS. NOW T HE DEPARTMENT IS IN 7 APPEAL AGAINST THE RELIEF ALLOWED TO THE ASSESSEE W HILE THE ASSESSEE IS IN APPEAL AGAINST THE CONFIRMATION OF PENALTY LEVIED B Y THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE ACT. 6 . LEARNED D.R. ALTHOUGH SUPPORTED THE ORDER OF THE ASSESSING OFFICER, BUT COULD NOT CONTROVERT THE FINDINGS GIVEN BY THE LD. CIT(A). IT WAS FURTHER STATED THAT SINCE THE ADDITIONS HAD BEEN RE STORED TO THE FILE OF THE LD. CIT(A), THE ISSUE RELATING TO DELETION OF P ENALTY MAY ALSO BE SET ASIDE TO THE LD. CIT(A). 7 . IN HIS RIVAL SUBMISSIONS, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT(A) HAS DELETED THE PENALTY ONLY TO THE EXTENT OF ADDITIONS WHICH HAD BEEN DELETED BY THE ITAT. THER EFORE, THE APPEALS OF THE DEPARTMENT DESERVE TO BE DISMISSED, PARTICULARL Y WHEN AFTER THE APPEAL EFFECT, NO ADDITION REMAINED ON THE BASIS OF WHICH THE IMPUGNED PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS LEVI ED BY THE ASSESSING OFFICER. IT WAS FURTHER STATED THAT WHEN THE ANOTH ER GROUNDS OF QUANTUM ADDITIONS ARE PENDING FOR FRESH ADJUDICATION BEFORE THE LD. CIT(A), THEN THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT ON T HE BASIS OF SAID ADDITIONS SHOULD NOT HAVE BEEN CONFIRMED BY HIM. 8 8 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PA RTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT THE LD. CIT(A) DE LETED THE PENALTY IN RESPECT OF THE ADDITION WHICH HAS BEEN DELETED BY T HE ITAT IN QUANTUM APPEAL. IT IS WELL SETTLED THAT WHEN THERE IS NO AD DITION, NO PENALTY UNDER SECTION 271(1)(C) OF THE ACT CAN BE LEVIED. WE, TH EREFORE, DO NOT SEE ANY MERIT IN THE APPEAL OF THE DEPARTMENT. 9 . AS REGARDS TO THE APPEAL OF THE ASSESSEE IS CONCE RNED, WHICH RELATES TO THE CONFIRMATION OF PENALTY UNDER SECTION 271(1) (C) OF THE ACT ON THE ADDITIONS WHICH HAD BEEN SET ASIDE TO THE LD. CIT(A ) IN QUANTUM APPEAL BY THE ITAT VIDE ORDER DATED 18/12/2012. IN OUR OP INION, WHEN THE ISSUE RELATING TO QUANTUM ADDITION IS STILL PENDING BEFOR E THE LD. CIT(A), THE ISSUE RELATING TO PENALTY ON THE SAID ADDITIONS IS ALSO TO BE SET ASIDE TO THE FILE OF THE LD. CIT(A) TO BE ADJUDICATED AFRESH AFTER CONSIDERING THE OUTCOME OF THE QUANTUM ADDITIONS WHICH HAS BEEN RES TORED TO HIS FILE. WE ORDER ACCORDINGLY. 10 . IN ALL OTHER CROSS APPEALS, THE ISSUE IS IDENTICA L HAVING SIMILAR FACTS, THE ONLY DIFFERENCE IS IN THE QUANTUM OF PENALTY AN D THE ADDITIONS 9 INVOLVED, THEREFORE, OUR FINDINGS GIVEN IN THE FORM ER PART OF THIS ORDER SHALL APPLY MUTATIS-MUTANDIS FOR ALL OTHER APPEALS. 11 . IN THE RESULT, APPEALS OF THE DEPARTMENT ARE DISM ISSED AND THE APPEALS OF THE ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE COURT ON 24 TH FEBRUARY, 2014). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 24 TH FEBRUARY, 2014. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JODHPUR.