M/s. Council of Handicrafts Development Corporation, Delhi V. ITO (E), New Delhi

ITA 6454/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96887 (ITAT-DELHI)
• Duration Of Justice: 8 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 16-07-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 26-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEVI SHARAN SINGH
• Assessee Lawyers: VIRENDER CHAUHAN
• Keywords: Capital asset; Depreciation; Charitable institution; Principle of natural justice
• Section: 80G; 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH SMC SMC SMC SMC : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA BEFORE SHRI G.C. GUPTA, VICE , VICE , VICE , VICE PRESIDENT PRESIDENT PRESIDENT PRESIDENT ITA NO ITA NO ITA NO ITA NO . .. . 6454/DEL/2014 6454/DEL/2014 6454/DEL/2014 6454/DEL/2014 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2010 2010 2010 2010 - -- - 11 1111 11 M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS DEVELOPMENT CORPORATION, DEVELOPMENT CORPORATION, DEVELOPMENT CORPORATION, DEVELOPMENT CORPORATION, WEST BLOCK NO.07, WEST BLOCK NO.07, WEST BLOCK NO.07, WEST BLOCK NO.07, R.K. PURAM, R.K. PURAM, R.K. PURAM, R.K. PURAM, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 1 11 110 066. 10 066. 10 066. 10 066. PAN : AAATC5655R. PAN : AAATC5655R. PAN : AAATC5655R. PAN : AAATC5655R. VS. VS. VS. VS. INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, TRUST WARD TRUST WARD TRUST WARD TRUST WARD- -- -III, III,III, III, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIRENDER CHAUHAN, CA. RESPONDENT BY : SHRI DEVI SHARAN SINGH, SR.DR. DATE OF HEARING : 16.07.2 16.07.2 16.07.2 16.07.2015 015 015 015 DATE OF PRONOUNCEMENT : 11.08.2015 11.08.2015 11.08.2015 11.08.2015 ORDER ORDER ORDER ORDER THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2010-1 1 IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-XXI, NE W DELHI DATED 26 TH SEPTEMBER, 2014. 2. THE GROUNDS OF APPEAL OF THE ASSESSEE ARE AS UNDER:- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCES OF THE CASE, LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF LD.AO WHILE MAKING ADDITIO NS OF RS.4,89,225/- ON ACCOUNT OF SHORTFALL OF APPLICATION OF INCOME BY RECORDING INCORRECT FACTS AND MAKING IRREL EVANT OBSERVATIONS AND WITHOUT PROVIDING ANY ADVERSE MATERIA L ON RECORD AND WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND WITHOUT CROSS EXAMINATION AND IN VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. T HEREFORE, THE ADDITIONS MADE AS SUCH MAY BE LIABLE TO BE DELETED . ITA-6454/DEL/2014 2 2. THAT IN ANY CASE AND ANY VIEW OF THE MATTER, ACTI ON OF LD.CIT(A) IN CONFIRMING THE ACTION OF LD.AO IN M AKING THE IMPUGNED ADDITION AND FRAMING THE IMPUGNED ASSESSMENT ORDER IS CONTRARY TO LAW AND FACTS, VOID AB-INITIO, B EYOND JURISDICTION, AND WITHOUT GIVING ADEQUATE OPPORTUNIT Y OF HEARING, BY RECORDING INCORRECT FACTS AND FINDINGS AN D THE SAME IS NOT SUSTAINABLE ON VARIOUS LEGAL AND FACTUAL GROUNDS. 3. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCES O F THE CASE, LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN N OT REVERSING THE ACTION OF LD.AO IN CHARGING INTEREST U/ S 234A, 234B, 234D AND OF THE INCOME TAX ACT, 1961. 3. LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSE SSEE IS A CHARITABLE TRUST REGISTERED U/S 12A AS WELL AS 80G OF THE INCOME-TAX ACT, 1961. HE SUBMITTED THAT THE DEPRECIATION ON CA PITAL ASSETS WHICH HAVE BEEN TAKEN AS APPLICATION OF INCOME IN THE EARL IER YEARS WAS DISALLOWED. HE SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF DIRECTOR OF INCOME-TAX (EXEMPTIONS) VS. INDRAP RASTHA CANCER SOCIETY [2015] 229 TAXMAN 93 (DELHI). 4. LEARNED DR HAS RELIED ON THE ORDER OF THE ASSESSING O FFICER AND THE LEARNED CIT(A). 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND HAVE PERU SED THE ORDER OF THE ASSESSING OFFICER AND THE LEARNED CIT(A). I FIND THAT THE ISSUE IN THE GROUNDS OF APPEAL OF THE ASSESSEE IS COVERED I N FAVOUR OF THE ASSESSEE WITH THE DECISION OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF INDRAPRASTHA CANCER SOCIETY (SUPRA). IN T HIS CASE, IT WAS HELD BY THE HONBLE HIGH COURT THAT WHERE THE CHARI TABLE INSTITUTION HAS PURCHASED CAPITAL ASSET AND TREATED AMOUNTS SPENT ON PURCHASE OF CAPITAL ASSET AS APPLICATION OF INCOME, IT IS ENTITLED TO CLAIM ITA-6454/DEL/2014 3 DEPRECIATION ON THE SAME CAPITAL ASSET UTILIZED BY THE ASSESSEE. IN THIS VIEW OF THE MATTER AND KEEPING IN VIEW THE FACT THA T THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE WITH THE DECISION OF H ONBLE JURISDICTIONAL HIGH COURT CITED SUPRA, THE GROUNDS OF APPEAL OF THE ASSESSEE ARE ALLOWED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 11 TH AUGUST, 2015. SD/- (G. (G. (G. (G. C. GUPT C. GUPT C. GUPT C. GUPT A AA A ) )) ) VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. COPY FORWARDED TO: - 1. APPELLANT : M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS M/S COUNCIL OF HANDICRAFTS DEVELOPMENT CORPORATION, WEST BLOCK NO.07, DEVELOPMENT CORPORATION, WEST BLOCK NO.07, DEVELOPMENT CORPORATION, WEST BLOCK NO.07, DEVELOPMENT CORPORATION, WEST BLOCK NO.07, R.K. PURAM, NEW DELHI R.K. PURAM, NEW DELHI R.K. PURAM, NEW DELHI R.K. PURAM, NEW DELHI 110 066. 110 066. 110 066. 110 066. 2. RESPONDENT : INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, INCOME TAX OFFICER, TRUST WARD TRUST WARD TRUST WARD TRUST WARD- -- -III, NEW DELHI. III, NEW DELHI. III, NEW DELHI. III, NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR