ITO 5(2)(3), MUMBAI V. MALABAR HILLS CLUB LTD, MUMBAI

MA 112/MUM/2021

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3492 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 8 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 06-10-2021
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2010-2011
• Appeal Filed On: 28-04-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Earning of tax free income; Tax effect; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , D BENCH MUMBAI BEFORE : SHRI PRAMOD KUMAR, VICE PRESIDENT & SHRI AMARJIT SINGH, JUDICIAL MEMBER MA NO.112/MUM/2021 (ARISING OUT OF ITA NO. 3592 /MUM/ 20 15) ( ASSESSMENT YEAR : 2010 - 11 ) ITO - 5(2)(3) R.NO.566, 5 TH FLOOR AAYAKAR BHAVAN MUMBAI 400 020 MAHARASHTRA VS. M/S. MALABAR HILLS CLUB LTD., B.G. KHER MARG MALABAR HILL MUMBAI 400 006 PAN/GIR NO. AAACW3868M (APPELLANT ) .. (RESPONDENT ) REVENUE BY SHRI VIJAYKUMAR SUBRAMANYAM ASSESSEE BY SHRI NIRAJ SHET H DATE OF HEARING 23 /0 7 /2021 DATE OF PRONOUNCEMENT 06 /10 /202 1 / O R D E R PER AMARJIT SINGH (JM): THE REVENUE HAS FILED THE PRESENT MISCELLANEOUS APPLICATION BEARING MA NO. 112/MUM/2021 ARISING OUT OF ITA NO.3592/MUM/2015 DATED 24/08/2020 FOR A.Y.2010 - 11. 2. BRIEF FACTS OF THE MISCELLANEOUS APPLICATION ARE THAT THE HONBLE ITAT HAS DISMISSED THE APPEAL OF THE REVENUE BEARING ITA NO.3592/MUM/2015 DATED 24/08/2020 ON ACCOUNT OF TAX EFFECT IN VIEW OF THE CIRCULAR NO.17/2019. IT IS STATED THAT THE TAX EFFECT WAS MORE THAN RS.50 LAKHS I.E. RS.1.47 CRORE, THEREFORE, THE ORDER IS LIABLE TO BE RECALLED IN THE INTEREST OF JUSTICE. M A NO . 112/MUM/2021 M/S. MALABAR HILLS CLUB LTD., 2 3. NOTICE GIVEN. 4. WE HAVE HEARD THE ARGUMENT ADVANCED BY THE LD. REPRESENTATIVE OF THE PARTIES AND PERUSE D THE RECORD. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS: - 1(I) 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. C I T(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO TREAT THE EQUIVALENT AMOUNT OF ENTRANCE FEES OF ORDINARY MEMBER AS CAPITA L RECEIPT IN THE CASE OF LIFE MEMBERS AND TAX THE REMAINING AMOUNT AS REVENUE RECEIPT WITHOUT APPRECIATING THE RATIO OF 20:80 AS IS DONE IN ASSESSMENT ORDER ? II) THE LD.CI T(A) FURTHER ERRED IN IGNORING THAT THE HON'BLE JURISDICTIONAL HIGH COURT DECIDED THE SAID ISSUE IN FAVOUR OF THE REVENUE FOR EARLIER YEARS IN ASSESSEE'S OWN CASE?' 2. 'ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.C I T(A) ERRED IN DELETING THE ENTIRE ADDITION OF RS.26,94,000 / - ON ACCOUNT OF LUMP - SUM ENTRANCE FEES REC EIVED FROM CORPORATE MEMBERS BY IGNORING THE ASSESSING OFFICER'S DETAILED FINDINGS GIVEN IN ASSESSMENT ORDER. THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT (APPEALS) BE SET ASIDE AND THE ORDER OF THE AO BE RESTORED. THE APPELLANT CRAVES LEAVE TO AMEN D OR ALTER ANY GROUND OR ADD ANY OTHER GROUNDS WHICH MAY BE NECESSARY. 5. UNDER THE ISSUE NO.1 & 2, REVENUE HAS CHALLENGED CLAIM OF THE ASSESSEE RAISED TOWARDS ENTRANCE FEES RECEIVED FROM HONORARY MEMBERS , RS.2,68,00,960/ - IN WHICH CLAIM OF RS.1,38,13,10 0/ - WAS ALLOWED AND TOWARDS ENTRANCE FEES RECEIVED FROM CORPORATE MEMBER OF RS.2,69,400/ - . THE CLAIM OF THE EXPENSES INCURRED FOR THE EXEMPT INCOME IN SUM OF RS.7,76,777/ - WAS ALSO ALLOWED. ALL THESE ISSUES ARE UNDER CHALLENGE AND TAX EFFECT SEEMS TO BE RS .1.47 CRORES WHICH NOWHERE COVERED BY VIRTUE OF CIRCULAR NO. 17/2019 DATED 08/08/2019. THEREFORE, IN THE SAID CIRCUMSTANCES, WE RECALL THE ORDER IN ITA NO.3592/MUM/2015 DATED 24/08/2020 AND THE REGISTRY IS DIRECTED TO REFIX THE MATTER IN DUE COURSE OF TIME . M A NO . 112/MUM/2021 M/S. MALABAR HILLS CLUB LTD., 3 6. IN THE RESULT, MISCELLANEOUS APPLICATION OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 06 /10 /202 1 BY WAY OF PROPER MENTIONING IN THE NOTICE BOARD. SD/ - ( PRAMOD KUMAR ) SD/ - ( AMARJIT SINGH ) VICE PRESID ENT JUDICIAL MEMBER MUMBAI ; DATED 06 / 10 / 2021 KARUNA , SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//