Vidyananda Educational Society, Hyderabad V. Dy.Director of Income Tax (Exemptions)-I, Hyderabad

MA 116/HYD/2014

• Counselvise Citation: [2014] 124 COUNSELVISE.COM (IT) 2314 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 24-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 07-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S RAMA RAO
• Section: 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER MISC. APPLN. NO.116/HYD/14 (IN ITA NO.131/HYD/14 : ASSESSMENT YEAR 2010 - 11 M/S. VIDYANANDA EDUCATIONAL SOCIETY, HYDERABAD ( PAN - AAATV 3962 G ) V/S. DY. DIRECTOR OF INCOME - TAX(EXEMPTION) I, HYDERABAD (APPLICANT) (RESPONDENT) APPLICANT BY : S HRI S.RAMA RAO RESPONDENT BY : SHRI SOLGY JOSE T.KOTTARAM DR DATE OF HEARING 01 .0 8 .2014 DATE OF PRONOUNCEMENT 24.09.2014 O R D E R PER SAKTIJIT DEY, JUDICIAL MEMBER: BY THIS APPLICATION UNDER S.254(2) OF THE INCOME TAX ACT,1961, THE APPLICANT - ASSESSEE SEEKS RECTIFICATION/RECALL OF THE ORDER OF THIS TRIBUNAL DATED 23 RD MAY, 2014 IN ITA NO.131/HYD/2014 FOR THE ASSESSMENT YEAR 2010 - 11, ON THE GROUND THAT CERTAIN MISTAKES APPARENT FROM RECORD HAVE CREPT INTO THE SAME. 2. THE LEARNED COUNSEL FOR THE ASSESSEE, AFTER NARRATING THE FACTUAL BACKGROUND OF THE CASE, REITERATING THE AVERMENTS MADE IN THE PRESENT APPLICATION TOOK US THROUGH PARA 10 OF THE ORDER OF THE T RIBUNAL DATED 23 RD MAY, 2014, AND SUMMARIZED THE OBSERVATIONS/FINDINGS OF THE TRIBUNAL THEREIN AS FOLLOWS - ( A ) THE ASSESSING OFFICER DENIED EXEMPTION UNDER S.11 ON THE G R OUND THAT THE ASSESSEE HAD NO APPROVAL UNDER S.10(23C ) (VI) MA NO.116/HYD/20114( ITA NO. 131 /HYD/201 4) M/S. VIDYANANDA EDUCATIONAL SOCIETY, HYDERABAD 2 OF THE I.T. AC T AND NO T BECAU S E OF THE CONCESSIO N GRANTED TO THE PERSON S SPECIFIED U/S. 13(3) OF THE I.T. ACT. ( B ) THERE IS VIOLATION OF SECTIONS 11 AND 13 OF THE ACT ON ACCOUNT OF CONCESSION S GI V EN TO THE P E RSONS MENTIONED THEREIN AND TH E R E FORE, THE EXEMPTION UN D ER S.11 OF THE ACT C ANNOT B E GRANTED. OUR SP E CIFIC ATTENTION IS INVITED TO THE PROVISIONS OF S.13(6) OF THE ACT, WHICH READS AS FOL L O W S - N OTWI T HSTAN D ING ANYTHING CONTAINED IN SUB - SECTION (1) OF SUB - SECTION (2), BUT WITHOUT PREJU D I C E TO THE P R O V I S IONS CONTAINED IN SUB - SE C TION (2) OF SECTION 12, IN THE CA S E OF A C H ARITABLE OR RELIGIOUS TRUST RUNNING A N EDUCATIONAL INSTITUTION OR A MEDICAL INSTITUTION OR A HOSPITAL THE EXEMPTION UNDER SECTION 11 OR SECTION 12 SHALL NO T BE DENIED IN RELATION TO ANY INCOME OTHER THAN THE INCOME REFERRED TO IN SUB - SEC TION (2) OF SECTION 12, BY R E ASON ONLY TH A T SUCH TRUST HAS PROVIDED EDUCATION OR ME D I C AL FACILI TI ES TO PERSONS REFERRED TO IN CLAUSE ( A) OR CLAUSE (B) OR CL A USE (C) OR CLAUSE (CC) OR CLAUSE ( D ) OF SUB - SECTION (3). IN VIEW OF THE ABOVE PROVISION, IT IS S UBMITTE D THAT WHEN A FREE EDUCATION I S PROVIDED TO THE SPECI F IED P ERSONS, THE ONLY COU R SE IS TO TAX THE FEE IN THE ASSESSMENT OF THE SO C IETY AND NO T REJECTING THE EXEMPTION UNDER S.11 OF THE ACT. IT IS THEREFORE, SUBMI T TED THAT THE CIT(A) HAS CORRECTLY DIRE C TED THE ASSESSING OFFICER TO GRANT EXEMPTION UNDER S.11 OF THE ACT AND TAX RS.4,08,500 . IN ANY EVENT, IT IS SUBMITTED THAT TH E RE IS NO GROUND RAISED BY THE ASSESSING OFFICER AGAINST THE SAID DIRECTION OF THE CIT(A) IN THE APPEAL UNDER ADJUDICATION BE FORE THE TRIBUNAL , WHICH INDICATES THAT THE ASSESSING OFFICER WAS VERY MUCH SATISFIED WITH THE SAME AND CONSEQUENTLY NO GROUND HAS BEEN RAISED IN THAT BEHALF. T HAT BEING SO, IT IS PLEADED THAT THE ADJUDICATION BY THE TRIBUNAL IN THE ABSENCE OF ANY GROUND R AISED BY THE REVENUE ON THAT ASPECT IS NOT JUSTIFIED AND NOT IN ACCORDANCE WITH THE PROVIS I ON S O F THE ACT. MA NO.116/HYD/20114( ITA NO. 131 /HYD/201 4) M/S. VIDYANANDA EDUCATIONAL SOCIETY, HYDERABAD 3 3. LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE CONTRARY, SUBMITTED THAT IT IS NO T CORRECT TO SAY THAT THE R E VENUE HAS NOT RAISED ANY GROUND CONTESTING THE DIRECTION GIVEN BY THE CIT(A) AND SUBMITTED THAT GROUND NO.5 IN THE APPEAL OF THE REVENUE COVERS THE GRIEVANCE OF THE REVENUE ARISING OUT OF THE DIRECTION GIVEN BY THE CIT(A) AS WELL . HE SUBMITTED THAT THERE IS NO MISTAKE APPARENT FROM RECOR D IN THE ORDER OF THE TRIBUNAL, AND CONSEQUENTLY THE APPLICATION OF THE ASSESSEE IS LIABLE TO BE REJECTED. 4. WE HAVE CON S I D ERED THE RIVAL SUBMI S SION S AND PERUSED THE MATERIAL AVAILABLE ON RECORD IN THE LIGHT OF THE ORDER OF THE TRIBUNAL DATED 23.5.20 14 AND THE AVERMENTS MADE BY THE ASSESSEE IN THE PRESENT APPLICATION. AS CAN BE SEEN, THE SPECIFIC GRIEVANCE OF THE ASSESSEE IS IN RESPECT OF DECISION RENDERED BY THE TRIBUNAL WHILE DECIDING GROUND NO.5 RAISED BY THE DEPARTMENT. THE GROUND NO.5 RAISED BY THE DEPARTMENT READS AS UNDER - 5. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE AND WHEN THE ASSESSEE HAS GOT INCOME FROM DEVELOPMENT FEES, SPECIAL FEES AND OTHER FEES ETC., MENTIONED IN PARA 7.1 OF THE ASSESSMENT ORDER AND WHEN IT HAS BEEN HELD BY THE HO NBLE INCOME TAX APPELLATE TRIBUNAL, HYDERABAD IN THEIR ORDER IN THE CASE OF VASAVI ACADEMY OF EDUCATION, HYDERABAD IN ITA NO.1120/HYD/2009, THAT THE ASSESSEE WOULD NOT BE ENTITLED FOR EXEMPTION EITHER U/S 11 OR U/S 10(23C) IN CASE IT COLLECTED ANY MONEY BY WHATEVER NAME IT IS CALLED I.E., DONATION, BUILDING FUND, AUDITORIUM FUND ETC., OVER AND ABOVE THE PRESCRIBED FEES FOR ADMISSION OF STUDENTS, UNDER THAT CIRCUMSTANCE, THE CIT(A) IS NOT JUSTIFIED IN DIRECTING THE AO TO ALLOW EXEMPTION U/S 11 OF THE IT AC T, 1961, TO THE ASSESSEE IN THIS CASE. A PERUSAL OF THE AFORESAID GROUND MAKES IT CLEAR THAT REVENUE IN THIS GROUND HAS RAISED THE ISSUE OF ELIGIBILITY OF CLAIM OF DEDUCTION EITHER UNDER S.10(23C) OR UNDER S.11, IF THE ASSESSEE HAS COLLECTED ANY MONEY, BY WHATEVER NAME CALLED, OVER AND ABOVE THE PRESCRIBED FEE. HOWEVER, ON PERUSAL OF THE OBSERVATIONS MADE BY TRIBUNAL IN PARAS 6 TO 9 AND ITS FINDING IN PARA 10, IT APPEARS, THE ITAT HAS CONSIDERED THE ISSUE OF DENIAL OF EXEMPTION UNDER S. 11 ON THE GROUND OF VIOLATION OF SEC.13(1)(C) READ WITH S.13(3) OF THE ACT, RELATING TO CHARGING OF CONCESSIONAL FEE FROM SOME MA NO.116/HYD/20114( ITA NO. 131 /HYD/201 4) M/S. VIDYANANDA EDUCATIONAL SOCIETY, HYDERABAD 4 OF THE STUDENTS. THIS PARTICULAR ISSUE HAS NOT BEE N AGITATED IN ANY OF THE GROUNDS RAISED BY THE DEPARTMENT. AS IT APPEARS, MISTAKENLY TAKING INTO CONSIDERATION GROUND NO.5 RAISED BEFORE CIT(A), TRIBUNAL HAS VENTURED INTO DECIDE THIS ISSUE. AS THERE IS MISTAKE APPARENT IN THE ORDER OF THE TRIBUNAL ON ACCO UNT OF IMPROPER CONSIDERATION OF GROUND NO.5 RAISED BY THE DEPARTMENT, WE ARE INCLINED TO RECALL THE APPELLATE ORDER DATED 23.5.2014 OF THE TRIBUNAL FOR THE LIMITED PURPOSE OF DECIDING GROUND NO.5 RAISED BY THE DEPARTMENT. THE REGISTRY IS DIRECTED TO FIX THE DATE OF HEARING ON GROUND NO.5 OF THE APPEAL ITA NO.131/HYD/2014, IN REGULAR COURSE AND INFORM THE PARTIES ACCORDINGLY. 5. IN THE RESULT, MISCELLANEOUS APP LICAT ION OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 24.09.2014 SD/ - SD/ - ( B.RAMAKOTAIAH ) ( SAKTIJIT DEY ) ACCOUNTANT MEMBER JUDICIAL MEMBER DT/ - 24 TH SEPTEMBER , 2014 COPY FORWARDED TO: 1. M/S. VIDYANANDA EDUCATIONAL SOCIETY, KHAJAGUDA VILLAGE, GOLCONDA POST, HYDERABAD 2 . DY. DIRECTOR OF INCOME - TAX(EXEMPTION) I, HYDERABAD 3. COMMISSIONER OF INCOME - TAX(APPEALS) I V HYDERABAD 4. COMMISSIONER OF INCOME - TAX III , HYDERABAD 5 DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S