ITO WD 12(3)(1), MUMBAI V. MAKER CHAMBER VI, PREMISES CO-OP SOC.LTD, MUMBAI

ITA 7942/MUM/2010

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8157 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 01-04-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 18-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PAVAN KUMAR BEER LA
• Assessee Lawyers: ASHOK J PATIL
• Section: 142(1); 147; 148

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B MUMBAI . . , , BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER /AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER ITA NO.7942/MUM/2010(A.Y.2002-03) ITA NO.7943/MUM/2010(A.Y. 2004-05) THE INCOME TAX OFFICER 12(3)(1) AAYKAR BHAVAN, MK ROAD, MUMBAI 400 020 (APPELLANT ) VS. M/S. MAKER CHAMBER VI, PREMISES CO-OP. SOC. LTD., JAMNALAL BAJAJ MARG, NARIMAN POINT, MUMBAI 400021 PAN: AAATM1425F (RESPONDENT) C.O. NO.56/MUM/2012(ARISING OUT OF ITA NO.7942/MUM/ 2010,A.Y.2002-03) C.O. NO.57/MUM/2012(ARISING OUT OF ITA NO.7943/MUM/ 2010,A.Y.2004-05) M/S. MAKER CHAMBER VI, PREMISES CO-OP. SOC. LTD., JAMNALAL BAJAJ MARG, NARIMAN POINT, MUMBAI 400021 PAN: AAATM1425F (CROSS OBJECTOR) VS. THE INCOME TAX OFFICER 12(3)(1) AAYKAR BHAVAN, MK ROAD, MUMBAI 400 020 (APPELLANT IN APPEAL) ASSESSEE BY : SHRI ASHOK J. PATIL REVENUE BY : SHRI PAV AN KUMAR BEERLA DATE OF HEARING : 30/09/2014 DATE OF PRONOUNCEMENT : 30 /09/2014 ORDER PER BENCH: THESE APPEALS ARE FILED BY THE REVENUE AND CROSS OBJECTIONS BY THE ASSESSEE AND ARE DIRECTED AGAINST TWO SEPARATE ORDERS PASSE D BY LD. CIT(A)-23, DATED ITA NO.7942 & 7943/MUM/2010 C.O. NO.56 & 57/MUM/2012 2 26/08/2010 FOR ASSESSMENT YEARS 2002-03 AND 2004-05 RESPECTIVELY. THE GROUNDS RAISED IN THE APPEALS AS WELL AS CROSS OBJECTIONS R EAD AS UNDER: 1. GROUNDS OF APPEAL IN ITA NO.7942/MUM/2010: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE NON OCCUPANCY CHARGES OF RS.2 4,59,560/- RELYING ON THE DECISION DTD. 17/07/2009 OF THE BOMBAY HIGH COURT IN WRIT PE TITION NO.527 OF 1996 IN ASSESSEES OWN CASE AND IN INCOME TAX APPEAL NO.999 OF 2004 IN THE CASE OF MITTAL COURT PREMISES CO-OP. SOC. LTD., IGNORING THE FACT THAT THE DEPARTMENTAL HAS NOT ACCEPTED THE SAID DECISION AND SENT A PROPOSAL FOR FILING SLP IN SUPREME COURT. 2. GROUNDS OF CROSS OBJECTION NO.56/MUM/12: 1. THE COMMISSIONER OF INCOME TAX (A) ERRED IN CONF IRMING THE REPORTING OF ASSESSMENT PROCEEDINGS U/S. 147 OF THE INCOME TAX ACT, 1961. 2. COMMISSIONER OF INCOME TAX (A) FAILED TO APPRECI ATE THE FACT THAT THE ASSESSMENT PROCEEDINGS WAS REOPENDED FOR ESCAPEMENT OF INCOME OF NOC OF RS.24,59,560/- WHICH HAVE BEEN DELETED BY HER AND YET ERRED IN HOLDING T HAT REOPENING PROCEEDINGS ARE VALID. 3. COMMISSIONER OF INCOME TAX (A) FAILED TO APPRECI ATE THE FACTS THAT THE ASSESSING OFFICER HAS TAKEN THE SHELTER AND OR PRETEXT OF THE PROVISIONS OF RE-OPENING AND MADE THE REGULAR ASSESSMENT. 3. GROUNDS OF APPEAL IN ITA NO.7943/MUM/2010: 1.ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ID. CIT(A) HAS ERRED IN DELETING THE NON OCCUPANCY CHARGES OF RS. 21,62, 617/- RELYING ON THE DECISION DTD. 17/07/2009 OF THE BOMBAY HIGH COURT IN WRIT PETITIO N NO. 527 OF 1996 IN ASSESSEES OWN CASE AND IN INCOME TAX APPEAL NO. 999 OF 2004 I N THE CASE OF MITTAL COURT PREMISES CO-OP. SOC.LTD. IGNORING THE FACT THAT THE DEPARTME NT HAS NOT ACCEPTED THE SAID DECISION AND SENT A PROPOSAL FOR FILING SLP IN SUPREME COURT . 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE ID. CIT(A) HAS ERRED IN DELETING THE TRANSFER FEES OF RS. 3,31,250/- REL YING ON THE DECISION DTD. 17/07/2009 OF THE BOMBAY HIGH COURT IN WRIT PETITION NO. 527 O F 1996 IN ASSESSEES OWN CASE AND IN INCOME TAX APPEAL NO. 999 OF 2004 IN THE CASE O F MITTAL COURT PREMISES CO-OP. SOC.LTD. IGNORING THE FACT THAT THE DEPARTMENT HAS NOT ACCEPTED THE SAID DECISION AND SENT A PROPOSAL FOR FILING SLP IN SUPREME COURT. 3, THE APPELLANT PRAYS THAT THE ORDER OF THE ORDER OF THE CIT(A) ON THE ABOVE GROUND(S) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. GROUNDS OF CROSS OBJECTION NO.57/MUM/12: 1. THE COMMISSIONER OF INCOME TAX (A) ERRED IN CONF IRMING THE REPORTING OF ASSESSMENT PROCEEDINGS U/S. 147 OF THE INCOME TAX ACT, 1961. 2. COMMISSIONER OF INCOME TAX (A) FAILED TO APPRECI ATE THE FACT THAT THE ASSESSMENT PROCEEDINGS WAS REOPENDED FOR ESCAPEMENT OF INCOME OF NOC OF RS.21,62,617/- AND ITA NO.7942 & 7943/MUM/2010 C.O. NO.56 & 57/MUM/2012 3 TRANSFER FEE OF RS.3,31,250/- WHICH HAVE BEEN DELET ED BY HER AND YET ERRED IN HOLDING THAT REOPENING PROCEEDINGS ARE VALID. 3. COMMISSIONER OF INCOME TAX (A) FAILED TO APPRECI ATE THE FACTS THAT THE ASSESSING OFFICER HAS TAKEN THE SHELTER AND OR PRETEXT OF THE PROVISIONS OF RE-OPENING AND MADE THE REGULAR ASSESSMENT. 2. AT THE OUTSET IT WAS SUBMITTED BY LD. AR THAT HO NBLE BOMBAY HIGH COURT IN ASSESSEES OWN CASE HAS DECIDED BOTH THE ISSUES IN FAVOUR OF ASSESSEE. IT WAS SUBMITTED THAT VIDE ORDER DATED 17/07/2009 IN WRIT PETITION NO.527 OF 1996 IN THE CASE OF ASSESSEE AND OTHERS HONBLE HIGH COURT HAS DECIDED THIS ISSUE AS FOLLOWS: 1. IN SO FAR AS THESE WRIT PETITIONS ARE CONCERNED WHAT IS BEING CHALLENGED ARE THE RE- OPENING OF THE ASSESSMENTS PURSUANT TO THE NOTICE I SSUED UNDER SECTION 148 OR NOTICE ISSUED UNDER SECTION 142(1) AS ALSO IN ONE CASE NOT ICE ISSUED UNDER SECTION 133(6). 2. NOTICES BASICALLY HAVE BEEN ISSUED ON THE GROUN D THAT THE TRANSFER FEES RECEIVED BY THE PETITIONERS FROM INCOMING MEMBERS WAS ASSESSABL E TO TAX CONSIDERING THE JUDGMENT OF THIS COURT IN THE CASE OF C.I.T V. THE PRESIDENC Y CO-OPERATIVE HOUSING SOCIETY, 216 ITR 321 (BOM). 3. WE HAVE IN THE JUDGMENT DELIVERED TODAY IN INCO ME TAX APPEAL NO.931 OF 2004 AND OTHER CONNECTED APPEALS DISTINGUISHED THE SAME ON THE GROUND THAT THE ISSUE OF MUTUALITY HAD NOT AT ALL BEEN IN ISSUE BEFORE THE LEARNED BENCH WHEN IT DECIDED THE REFERENCE. ONCE WE HAVE HELD THE TRANSFER FEE EVEN PAID BY INCOMING MEMBERS IS NOT ASSESSABLE TO THE TAX APPLYING THE DOCTRINE OF MUTU ALITY, THE NOTICE ISSUED WOULD BE WITHOUT JURISDICTION AND CONSEQUENTLY WILL HAVE TO BE SET ASIDE. 4. WE HAVE ALSO IN INCOME TAX APPEAL NO.999 OF 200 4 IN THE CASE OF MITTAL COURT PREMISES VS. INCOME TAX OFFICER DECIDED ON 17.7.200 9 HAVE ALSO DECIDED THAT IN RESPECT OF NON-OCCUPANCY CHARGES THAT IS ALSO SUBJECT TO TH E PRINCIPLE OF MUTUALITY AND NOT SUBJECT TO TAX. 5. RULE MADE ABSOLUTE IN TERMS OF PRAYER CLAUSE (A ) IN EACH OF THE PETITIONS. COPY OF THE ORDER HAS BEEN FILED AT PAGES 28 TO 37 OF THE PAPER BOOK. 3. IT WAS SUBMITTED THAT HONBLE BOMBAY HIGH COURT HAS HELD THAT TRANSFER FEE AS WELL AS NON-OCCUPANCY CHARGES WOULD BE GOVERNED B Y PRINCIPLE OF MUTUALITY, THEREFORE, COULD NOT BE TAXED. THUS, IT WAS SUBMIT TED BY LD. AR THAT THE DEPARTMENTAL APPEALS SHOULD BE DISMISSED AS THE REL IEF HAS BEEN GIVEN BY LD. CIT(A) FOLLOWING THE AFOREMENTIONED DECISION OF HONBLE B OMBAY HIGH COURT. ITA NO.7942 & 7943/MUM/2010 C.O. NO.56 & 57/MUM/2012 4 4. ON THE OTHER HAND, LD. DR SUBMITTED THAT SINCE D EPARTMENT HAS NOT ACCEPTED THE DECISION OF HONBLE BOMBAY HIGH COURT AND HAS F ILED SLP, THEREFORE, THESE APPEALS HAVE BEEN FILED FOR KEEPING ALIVE THE ISS UE. 5. ON DEPARTMENTAL APPEAL WE HAVE HEARD BOTH THE PA RTIES. THE APPEAL OF THE DEPARTMENT IN RESPECT OF A.Y 2002-03 IS REGARDING N ON-OCCUPANCY CHARGES AND APPEAL FOR A.Y 2004-05 IS WITH REGARD TO NON-OCCUP ANCY CHARGES AS WELL AS TRANSFER FEE. BOTH THESE RECEIPTS HAVE BEEN HELD TO BE GO VERNED BY THE PRINCIPLE OF MUTUALITY BY HONBLE BOMBAY HIGH COURT IN THE CASE OF ASSESSE E ITSELF. THEREFORE, WE HOLD THAT THERE IS NO INFIRMITY IN THE RELIEF GIVEN BY LD. CI T(A) IN RESPECT OF GROUNDS RAISED BY THE REVENUE AND THERE IS NO MERIT IN THE APPEALS FI LED BY THE REVENUE. WE DISMISS BOTH THE APPEALS FILED BY THE REVENUE. 6. NOW COMING TO THE CROSS OBJECTIONS FILED BY THE ASSESSEE, IT IS SEEN THAT THE ONLY GRIEVANCE OF THE ASSESSEE IN THE CROSS OBJECTI ONS IS REGARDING RE-OPENING OF THE ASSESSMENT AS THERE IS NO OTHER GRIEVANCE OF THE AS SESSEE. SINCE ON MERITS WE HAVE HELD THAT ADDITIONS HAVE RIGHTLY BEEN DELETED BY L D. CIT(A), THEREFORE, CONSIDERATION OF THE CROSS OBJECTIONS OF THE ASSESSEE ON MERITS W OULD BE AN ACADEMIC EXERCISE WHICH NEED NOT TO BE GONE INTO IN THE PRESENT FACT S AND CIRCUMSTANCES OF THE CASE. WE, THEREFORE, WE DISMISS THE CROSS OBJECTIONS FILE D BY THE ASSESSEE ON THE GROUND OF HAVING BECOME ACADEMIC. 7. IN THE RESULT, THE APPEALS FILED BY THE REVENUE AS WELL AS CROSS OBJECTIONS FILED BY THE ASSESSEE ARE DISMISSED IN THE MANNER AFORESA ID. ORDER PRONOUNCED IN THE OPEN COURT ON 30/09/201 4 ! ' #$ % &'( 30/09/2014 ' ) SD/- SD/- ( /SANJAY ARORA ) ( . . / I.P. BANSAL ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; &' DATED 30/09/2014 ITA NO.7942 & 7943/MUM/2010 C.O. NO.56 & 57/MUM/2012 5 ! ! ! ! ' '' ' *+, *+, *+, *+, -,$+ -,$+ -,$+ -,$+ / COPY OF THE ORDER FORWARDED TO : 1. ./ / THE APPELLANT 2. *0./ / THE RESPONDENT. 3. 1 ( ) / THE CIT(A)- 4. 1 / CIT 5. ,2) *+' , , / DR, ITAT, MUMBAI 6. )3 4 / GUARD FILE. !' !' !' !' / BY ORDER, 0,+ *+ //TRUE COPY// 5 55 5 / 6 6 6 6 (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI . ' . ./ VM , SR. PS