DCIT (E) 1(1), MUMBAI V. ADITYA BIRLA MEMORIAL TRUST, MUMBAI

ITA 6648/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8432 (ITAT-MUMBAI)
• Duration Of Justice: 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 11-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR
• Assessee Lawyers: SHREEJA GANGWAL
• Keywords: Charitable institution; Tax effect
• Section: 143(3); 12A; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B, MUMBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH , JUDICIAL MEMBER ITA NO. 6648/MUM/2016 : A.Y : 2011 - 12 DY. CIT (EXEMPTION) - 1(1), MUMBAI (APPELLANT) VS. ADITYA VIKRAM BIRLA MEMORIAL TRUST, C - 1, ADITYA BIRLA CENTRE, S.K. AHIRE MARG, WORLI, MUMBAI 400 030 (RESPONDENT) PAN : AAATA7506M APPELLANT BY : SHRI SUMAN KUMAR RESPONDENT BY : MS. AYUSHI MODANI & MS. SHREEJA GANGWAL DATE OF HEARING : 07/11/2017 DATE OF PRONOUNCEMENT : 10 /11/2017 O R D E R PER G.S. PANNU , AM : THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A), MUMBAI - 1 DATED 19.08.2016 PERTAINING TO THE ASSESSMENT YEAR 2011 - 12 , WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER, MUMBAI DATED 14.03.2014 U/S 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). 2 ADITYA VIKRAM BIRLA MEMORIAL TRUST ITA NO. 6648/MUM/2016 2. IN ITS APPEAL, REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. WHETHER ON THE FACTS OF THE CASE AND IN LAW THE ID.CLT(A) ERRED IN ALLOWING THE CARRY FORWARD OF DEFICIT OF RS. 41,60,67,623/ - (I.E. RS.27,30,42,552/ - OF THE YEAR UNDER CONSIDERATION AND RS.14,30,25,071/ - OF THE EARLIER YEARS) AND ALLOWING TO SET OFF AGAINST THE INCOME OF THE SUBSEQUENT YEARS. 2. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) ERRED IN ALLOWING THE CLAIM OF THE ASSESSEE FOR CARRY FORWARD OF THE SAID DEFICIT, IGNORING THE FACT THAT THERE WAS NO EXPRESS PROVISION IN THE I T ACT, 1961 PERMITTING ALLOWANCE OF SUCH CLAIM. 3. WHETHER, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) ERRED IN ALLOWING THE CLAIM OF THE ASSESSEE FOR CARRY FORWARD OF THE SAID DEFICIT BY RELYING UPON THE JUDGMENT OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF INSTITUTE OF BANKING PERSONNEL SELECTION, IGNORING THE FACT THAT THE DEPARTMENT HAS NOT ACCEPTED THE SAID DECISION OF THE JURISDICTIONAL HIGH COURT ON MERIT OF THE CASE, BUT DUE TO SMALLNESS OF TAX EFFECT APPEAL WAS NOT FI LED BEFORE HON'BLE SUPREME COURT. HOWEVER, ON THIS ISSUE THE DEPARTMENT HAS FILED SLP BEFORE THE APEX COURT IN THE CASE OF MIDC (SPL (CIVIL) 9891 OF 2014) AS WELL AS IN OTHER CASES AND THE MATTER IS PENDING FOR ADJUDICATION BEFORE THE HON'BLE SUPREME COURT . 4. THE APPELLANT PRAYS THAT THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - L, MUMBAI BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 3. ALTHOUGH THE REVENUE HAS RAISED MULTIPLE GROUNDS OF APPEAL, BUT THE SOLITARY DISPUTE INVOLVED IN THIS APPEAL IS AGAINST THE ACTION OF THE CIT(A) IN ALLOWING THE ASSESSEE THE BENEFIT OF CARRY FORWARD OF THE DEFICIT FOR FUTURE SET - OFF. 3 ADITYA VIKRAM BIRLA MEMORIAL TRUST ITA NO. 6648/MUM/2016 4. IN THIS BACKGROUND, NOW WE MAY REFER TO THE RELEVANT FACTS. THE RESPONDENT - ASSESSEE IS A CHARITABLE ORGANISATION REGISTERED U/S 12A OF THE ACT AND IS ENGAGED IN CARRYING ON ACTIVITIES OF CHARITABLE NATURE. THE ASSESSING OFFICER NOTICED THAT ASSESSEE HAD SHOWN RS.41,60,67,623/ - AS DEFICIT AND CLAIMED BENEFIT OF CARRY FORWARD FOR FUTURE SET - OFF. THE ASSESSING OFFICER DENIED THE BENEFIT BY OBSERVING THAT LOSS/DEFICIT CANNOT BE DETERMINED WHILE COMPUTING INCOME U/S 11 OF THE ACT. THE CIT(A) HAS SINCE ALLOWED THE CLAIM OF THE ASSESSEE FOLLOWING THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF INSTITUTE OF BA NKING PERSONNEL SELECTION, 264 ITR 110 (BOM) . 5. BEFORE US, THE PLEA OF THE DEPARTMENT IS THAT THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA) HAS NOT BEEN ACCEPTED BY THE DEPARTMENT ON MERITS AND ON A SIMILAR ISSUE, SLP (CIVIL) NO. 9891 OF 2014 HAS BEEN FILED BEFORE THE HON'BLE SUPREME COURT IN THE CASE OF MAHARASHTRA INDUSTRIAL DEVELOPMENT CORPORATION (MIDC) . SO, HOWEVER THERE IS NO CONTROVERSION BY THE REVENUE TO THE FACT THAT THE DECISION O F THE CIT(A) IS IN LINE WITH THE JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA) . 6. WE FIND THAT THE HON'BLE BOMBAY HIGH COURT SUBSEQUENT TO THE DECISION IN THE CASE OF INSTITUTE OF BANKING PERSON NEL SELECTION (SUPRA) CONSIDERED A SIMILAR ARGUMENT OF THE REVENUE IN THE CASE OF M/S. MUMBAI EDUCATION TRUST, ITA NO. 11/2014 DATED 3.5.2016 AND ALLOWED THE CLAIM OF THE ASSESSEE. IN FACT, ONE OF THE GROUNDS OF APPEAL URGED BY THE REVENUE BEFORE THE HON' BLE HIGH COURT, WHICH READ AS UNDER : - 4 ADITYA VIKRAM BIRLA MEMORIAL TRUST ITA NO. 6648/MUM/2016 ........................ (B) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE AND IN LAW, THE TRIBUNAL WAS JUSTIFIED IN CONFIRMING THE ORDER OF THE CIT(A) TO ALLOW TO CARRY FORWARD OF DEFICIT OF EARLIER YEARS RELYING ON THE DECISION OF THIS COURT IN THE CASE OF CIT V/S. INSTITUTE OF BANKING PERSONNEL SERVICES REPORTED IN 264 ITR 110 (BOM) WHILE THE REVENUE DID NOT FILE SLP AGAINST THE CASE OF CIT V/S. INSTITUTE OF BANKING PERSONNEL SERVICES REPORTED IN 26 4 ITR110 (BOM) DUE TO LOW TAX EFFECT?. STAND S ON THE SAME FOOTING AS ARE BEING CANVASSED BEFORE US IN THE INSTANT CASE. MOREOVER, AND AS WAS POINTED OUT BY THE LEARNED REPRESENTATIVE FOR THE RESPONDENT - ASSESSEE, SIMILAR ISSUE WAS DECIDED BY THE TRIBUNAL IN ASSESSMENT YEAR 2009 - 10 IN FAVOUR OF ASSESSEE VIDE ITA NO. 5923/MUM/2012 DATED 27.11.2013. THIS DECISION HAS SINCE BEEN AFFIRMED BY THE HON'BLE HIGH COURT OF BOMBAY IN ITA NO. 1087 OF 2014 DATED 16.12.2016. THUS, THERE IS NO ERROR ON THE PART OF THE CIT(A) IN FOLLOWING THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA) AND ALLOWING THE STAND OF THE ASSESSEE. THE OTHER ARGUMENT TAKEN BY THE REVENUE THAT ITS SLP FILED BEFORE THE HON'BLE SUPREME COURT IS PENDING ON A SIMILAR ISSUE IS OF NO CONSEQUENCE INASMUCH AS THE BINDING JUDGMENTS OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE S OF INSTITUTE OF BANKING PERSONNEL SELECTION (SUPRA) ; M/S. MUMBAI EDUCATION TRUST (SUPRA) AS WELL AS IN ASSESSEES OWN CASE CONTINUE TO SUBSIST. THEREFORE, IN THIS BACKGROUND, WE FIND NO MERIT IN THE GROUND RAISED BY THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. 5 ADITYA VIKRAM BIRLA MEMORIAL TRUST ITA NO. 6648/MUM/2016 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 0 T H NOVE MBER, 2017 SD/ - SD/ - ( PAWAN SINGH ) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER MUMBAI, DATE : 1 0 T H NOVEMBER , 201 7 *SSL* COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, B BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI