DCIT, Jaipur V. M/S GLOBAL INSTITUTE OF TECHNOLOGY SOCIETY, Jaipur

ITA 892/JPR/2012

• Counselvise Citation: 89223114 RSA 2012
• Duration Of Justice: 2 year(s) 3 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 27-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PURSHOTTAM KASHYAP CIT DHK
• Assessee Lawyers: RAGHAV BAJAJ
• Keywords: Depreciation; Charitable institution; Capital receipt; Benefit of exemption; Unabsorbed depreciation
• Section: 234B; 12; 11

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM VK;DJ VIHY LA-@ ITA NO. 892/JP/2012 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10 THE DCIT CIRCLE- 5 JAIPUR CUKE VS. M/S. GLOBAL INSTITUTE OF TECHNOLOGY SOCIETY, D-91, AMBA BARI, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAATG 3217 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT C.O. NO. 79/JP/2012 (ARISING OUT OF VK;DJ VIHY LA-@ ITA NO. 892/JP/2012) FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10 M/S. GLOBAL INSTITUTE OF TECHNOLOGY SOCIETY, D-91, AMBA BARI, JAIPUR CUKE VS. THE DCIT CIRCLE- 5 JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AAATG 3217 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI SANJAY JHANWAR & SHRI RAGHAV BAJAJ, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY: SHRI PURSHOTTAM KASHYAP, ADDL. CIT LQUOKBZ DH RKJH[K@ DATE OF HEARING : 11/02/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 13 /03/2015 ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 2 VKNS'K@ ORDER PER R.P. TOLANI, JM THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LD. CIT(A)-II, JAIPUR DATED 27-09-2012 FOR THE ASSESSME NT YEAR 2009-10. THE ASSESSEE HAS FILED THE CROSS OBJECTION. 2.1 THE SOLITARY GROUND RAISED BY THE REVENUE IS AS UNDER:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN:- (I) ALLOWING THE BENEFIT OF QUANTIFIED CARRIED FORW ARD LOSSES TO THE ASSESSEE AGAINST THE INCOME OF THE AS SESSEE. 2.2 THE ASSESSEE HAS RAISED FOLLOWING GROUNDS IN IT S CROSS OBJECTION. 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. C I T( APPEALS ), JAIPUR- II , JAIPUR HAS ERRED IN AFFIRMING THE ACTION OF ASSESSING OFFICER IN DENYING THE EXEMPTION U/S 11 OF THE INCOME-TAX ACT, 1961 TO THE APPELLANT SOCIETY BY INVOKING THE PROVISIONS OF SEC TION 13(2)( A ) A N D 13(1)(D) OF THE ACT. 2. UNDER THE FACTS & CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. C I T(APPEALS), JAIPUR- II , JAIPUR HAS ERRED IN AFFIRMING THE ACTION OF THE LD. ASSESSING OFFICER IN: - A. CONSIDERING THE AMOUNT TRANSFERRE D TO THE DEVELOPMENT R ESERVE TO THE TUNE OF RS.37,17,688/- AS INCOME AND ADDING THE SAME TO THE 'TOTAL INCOME' OF THE RESPONDENT SOCIETY. ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 3 B. INCLUDING THE AMOUNT RECEIVED ON ACCOUNT OF SALE OF ADMISSION FORMS TO THE TUNE OF RS.9,55,000/- IN '' T OTAL INCOME' WHEN THE AMOUNT SO RECEIVED WAS IN THE NA T URE OF CAPITAL R ECEIPT BEING ONE TIME RECEIPT, LIABLE TO BE TRANSFE RRE D TO 'GENERAL RESERVE'. C. TREATING THE AMOUNT RECEIVED ON ACCOUNT OF BOOK- BANK TO THE TUNE OF RS. 4,73,810/- AS INCOME OF THE RESPON D ENT SOCIETY WHEN THE SAME WAS CAPITAL RECEIPT FOR THE PURPOSE OF BU Y ING BOOKS FOR THE LIBRARY AND THUS TRANSFERRED TO THE ' GENERAL R ESERVE '. D. INCLUDING THE AMOUNT RECEIVED ON ACCOUNT OF FORMS AND LATE FEES TO THE TUNE OF RS. 1069625/- I N 'TOTAL INCOME' WHEN THE AMOUNT SO RECEIVED WAS IN THE NAT U RE OF CAPITAL RECEIPT BEING ONE TIME RECEIPT, LIABLE TO BE TRANSF ERRED TO 'GENE R AL RESERVE'. E. DISALLOWING THE DEPRECIATION CLAIMED BY THE RESPONDENT SOCIETY ON BUSES TO TH E E XTENT OF RS. 7,38,880/ -. F. DISALLOWING THE EXPENSE UNDER THE HEAD 'DONATION ' TO THE TUNE OF RS.24,571/- WHICH HAS ACTUALLY BEEN PAID TO AGRAWAL S AMAJ SEWA SAMITI AND OTHER CHARITABLE TRUSTS. G. DISALLOWING THE EXPENSE UNDER THE HEAD 'STUDENT WELFARE' TO THE TUNE OF RS.1,25,000/- WHICH HAS ACT UALLY BEEN PAID FOR THE WELFARE OF A STUDENT TO 'RAMAN EDUCATION SOCIETY'. H. DETERMINING THE TAXABLE INCOME OF THE RESPONDENT SOCIETY AT RS. 60 ,75,130 /- AND NOT GRANTING THE BENEFIT OF APPLICATION OF INCOME AS PER THE PROVISIONS OF SECT ION 11 OF THE ACT. 2.3 DURING THE COURSE OF HEARING, THE LD. COUNSEL F OR THE ASSESSEE CONTENDS THAT THE ISSUE IN QUESTION IS SIMILAR TO A SSESSMENT YEAR 2008-09 ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 4 IN ASSESSEE'S OWN CASE. THE LD. CIT(A) HAS PASSED T HE ORDER IN QUESTION ALLOWING SET OFF OF CARRIED FORWARD LOSSES TO THE ASSESSEE BY FOLLOWING THE ITAT JUDGEMENT WHICH IS EVIDENT FROM FOLLOWING PARA 9 OF LD. CIT(A)S ORDER. 9. FOR THE SAKE OF CLARIFICATION FOR THE YEAR UNDE R CONSIDERATION THERE WAS A POSITIVE INCOME, AND THER EFORE, ASSESSEE HAS FILED ITS RETURN SHOWING THE INCOME OF THE YEAR , EXEMPTION U/S 11 OF THE ACT HAS BEEN CLAIMED. IF THE CARRY FORWAR D LOSSES ARE ALLOWED TO BE SET OFF THEN THE INCOME WILL BECOME O F NEGATIVE FIGURE AND THEREFORE, EXEMPTION U/S 11 CANNOT BE ALLOWED. THE LD. COUNSEL OF THE ASSESSEE HAS FAIRLY AGREED THAT IF THE GROUN D NO. 8 IS ALLOWED IN ITS FAVOUR THEN OTHER GROUNDS WILL BECOM E ACADEMIC IN NATURE. SINCE WE HAVE ALLOWED THIS GROUND IN FAVOUR OF THE ASSESSEE THEREFORE, ALL OTHER GROUNDS HAVING BECOME ACADEMIC IN NATURE AND HAS BECOME INFRUCTUOUS, THEY ARE DISMISSED. RESPECTFULLY FOLLOWING HON'BLE ITAT BENCH A JAIPU R ORDER DATED 15-03-2012 IN THE CASE OF THE APPELLANT IN AS SESSMENT YEAR 2008-09, THE AO IS DIRECTED TO ALLOW SET OFF OF QU ANTIFIED CARRIED FORWARD LOSSES TO THE ASSESSEE AGAINST THE INCOME O F THE ASSESSEE. GROUND NO. 11 IS ALLOWED IN FAVOUR OF THE APPELLANT . 2.4 THIS BENCH OF ITAT IN ASSESSEE'S OWN CASE (ITA NO. 1062/JP/2011 DATED 15-03-2012) FOR THE ASSESSMENT YEAR 2008-09 HAS HELD AS UNDER:- 2. VARIOUS GROUNDS I.E. 10 IN NUMBER HAVE BEEN TAKE N BY THE ASSESSEE IN ITS APPEAL. THE LD. COUNSEL OF THE ASSESSEE STATED THAT IF GROUND NO. 8 IS TAKEN FIRST AND IF THE SAME IS ALLO WED, THEN OTHER GROUNDS WILL BECOME ACADEMIC IN NATURE AND, THEREFORE, THEY CAN BE DISMISSED AS HAVING BECOME INFRUCTUOUS IN NATURE FOR THE YEAR UN DER CONSIDERATION. ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 5 3. GROUND NO. 8 IS AGAINST IN NOT ALLOWING THE BENE FIT OF CARRY FORWARD LOSSES AND UNABSORBED DEPRECIATION UNDER SE CTION 32(2) TO THE APPELLANT SOCIETY WHILE NOT GRANTING THE BENEFIT OF EXEMPTION UNDER SECTION 11 OF THE ACT. 4. GROUND NO. 9 IS AGAINST CHARGING OF INTEREST UND ER SECTION 234B WHICH IS CONSEQUENTIAL IN NATURE. THE AO WILL GRANT CONSEQUENT RELIEF, IF ANY. 5. NOW WE WILL TAKE UP THE GROUND NOS. 8 OF THE ASS ESSEE. 6. THE LD. COUNSEL OF THE ASSESSEE STATED THAT IN E ARLIER YEAR THE ASSESSEES TOTAL INCOME WAS OF LOSS AND, THEREFORE, THE ASSESSEE HAS NOT CLAIMED ANY EXEMPTION UNDER SECTION 11 NEITHER IT W AS ALLOWED. IT WAS ALSO SUBMITTED THAT ASSESSEE APPLIED FOR EXEMPTION OF ITS INCOME UNDER SECTION 10(23C)(VI) OF THE ACT. THE LD. CHIEF COMM ISSIONER OF INCOME-TAX VIDE HIS ORDER DATED 22.3.2006 HAD REJECTED THE APP LICATION OF THE ASSESSEE AND THIS FACT HAS BEEN MENTIONED IN THE OR DER PASSED FOR THE ASSESSMENT YEAR 2004-05, COPY OF WHICH IS PLACED AT PAPER BOOK PAGES 66-70. IT WAS SUBMITTED THAT IN EARLIER YEARS ASS ESSMENT HAS BEEN COMPLETED AND DEPARTMENT ITSELF HAS ALLOWED THE LOS S TO BE CARRY FORWARD. ATTENTION OF THE BENCH WAS DRAWN ON VARIOUS ASSESSM ENT ORDERS PLACED IN THE PAPER BOOK. 7. ON THE OTHER HAND, THE LD. D/R STATED THAT THE I SSUE MAY BE DECIDED ON MERIT. 8. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING T HE MATERIAL ON RECORD, WE FIND THAT ASSESSEE DESERVES TO SUCCEED I N THIS GROUND. WE HAVE SEEM VARIOUS ASSESSMENT ORDERS FOR EARLIER YEARS, C OPIES OF WHICH ARE PLACED ON RECORD AND FOUND THAT THE RESPECTIVE ASSE SSING OFFICERS HAD ALLOWED THE NET DEFICIT TO BE CARRIED FORWARD IN TH E RESPECTIVE ASSESSMENT ORDER. THEREFORE, THERE IS NO REASON IN NOT ALLOWIN G THE BENEFIT OF CARRY FORWARD LOSSES/DEFICIT. ACCORDINGLY, WE DIRECT THE AO TO ALLOW THE BENEFIT OF QUANTIFIED CARRY FORWARD LOSSES TO THE ASSESSEE AGAINST THE INCOME OF THE ASSESSEE. ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 6 9. FOR THE SAKE OF CLARIFICATION, FOR THE YEAR UNDE R CONSIDERATION THERE WAS A POSITIVE INCOME AND, THEREFORE, ASSESSEE HAS FILED ITS RETURN SHOWING THE INCOME OF THE YEAR, EXEMPTION UNDER SEC TION 11 OF THE ACT HAS ALSO BEEN CLAIMED. IF THE CARRY FORWARD LOSSES ARE ALLOWED TO BE SET OFF THEN THE INCOME WILL BECOME OF NEGATIVE FIGURE AND, THEREFORE, EXEMPTION UNDER SECTION 11 CANNOT BE ALLOWED. THE LD. COUNSEL OF THE ASSESSEE HAS FAIRLY AGREED THAT IF THE GROUND NO. 8 IS ALLOWED IN ITS FAVOUR THEN OTHER GROUNDS WILL BECOME ACADEMIC IN NATURE. SINCE WE HAVE ALLOWED THIS GROUND IN FAVOUR OF THE ASSESSEE, THER EFORE, ALL OTHER GROUNDS HAVING BECOME ACADEMIC IN NATURE AND HAS BECOME INF RUCTUOUS, THEY ARE DISMISSED. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D IN PART. 2.5 IT IS PLEADED BY THE LD. AR OF THE ASSESSEE TH AT SINCE THE LD. CIT(A) HAS PASSED THE ORDER FOLLOWING THE JUDGMENT OF ITAT , THEREFORE, THERE IS NO INFIRMITY IN THE ORDER OF THE SAME. IF THE CARRI ED FORWARD LOSSES ARE ALLOWED TO THE ASSESSEE THEN THE INCOME WILL REMAIN NEGATIVE AND THE ISSUE IN QUESTION AS TO SECTION 11 AND 12 WILL NOT ARISE. IF THE ORDER PASSED BY THE LD. CIT(A) IS UPHELD THEN THE C.O. OF THE ASSESSEE BECOMES INFRUCTUOUS. 2.6 THE LD. DR IS HEARD. 2.7 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. WE FIND NO INFIRMITY IN THE OR DER OF THE LD. CIT(A) WHO HAS FOLLOWED THE ORDER OF THIS BENCH IN ASSESSE E'S OWN CASE FOR THE ASSESSMENT YEAR 2008-09 (ITA NO. 1062/JP/2011 DATED 15-03-2012) ITA NO. 892//JP/2012 DCIT CIRCLE- 5, JAIPUR VS. GLOBAL INSTITUTE OF TECH NOLOGY . 7 HOLDING THAT THE ASSESSEE IS ELIGIBLE TO BENEFITS O F SET OFF OF CARRIED FORWARD LOSSES. RESPECTFULLY FOLLOWING THE DECISION OF THIS BENCH (SUPRA), WE DISMISS THE APPEAL OF THE REVENUE. SINCE THE APP EAL OF THE REVENUE IS DISMISSED, THEREFORE, THE GROUNDS OF THE ASSESSEE W ILL BECOME INFRUCTUOUS AS CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEE. 3.0 IN THE RESULT, THE APPEAL OF THE REVENUE AS WEL L AS C.O. OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 /03/ 2015. SD/- SD/- VH-VKJ-EHUK VKJ-IH-RKSYKUH (T.R. MEENA) (R.P.TOLANI) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 13 /03/ 2015 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE DCIT, CIRCLE- 5, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- M/S. GLOBAL INSTITUTE OF TECHNOLOG Y, JAIPUR 3. VK;DJ VK;QDRVIHY ) @ CIT(A), JAIPUR 3. VK;DJ VK;QDR@ CIT, JAIPUR 4. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 5. XKMZ QKBZY@ GUARD FILE (ITA NO.892/JP/2012) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR