Mercedes-Benz Education Academy, Pune V. Income-tax Officer,

MA 48/PUN/2016

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6810 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 4 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 05-06-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-02-2018
• Assessment Year: 2004-2005
• Appeal Filed On: 31-08-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 12AA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E , , , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM M.A. NOS. 46 TO 49 /PUN/2016 (ARISING OUT OF ITA NOS.1913 TO 1916/PUN/2013) / ASSESSMENT YEARS : 2002-03 TO 2004-05 & 2007-08 MERCEDES BENZ EDUCATION ACADEMY, PLOT NO.26, RAJIV GANDHI INFOTECH PARK, MIDC PHASE-I, HINJEWADI, PUNE-411 057 PAN : AAATM1757A .. /APPLICANT / V/S. THE INCOME TAX OFFICER, WARD 11 (1), PUNE. / RESPONDENT ASSESSEE BY : SHRI KISHORE PHADKE REVENUE BY : SHRI ACHAL SHARMA / DATE OF HEARING : 04.05.2018 / DATE OF PRONOUNCEMENT : 05.06.2018 / ORDER PER SUSHMA CHOWLA, JM THIS BUNCH OF MISCELLANEOUS APPLICATIONS HAVE BEEN FILED BY THE APPLICANT AGAINST THE ORDER OF TRIBUNAL DATED 30.11.2015. 2 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 2. THE TRIBUNAL HAD DECIDED THE ISSUE OF DEEMED APP ROVAL OF THE ENTITY UNDER SECTION 10(23C)(VI) OF THE ACT, VIDE PARA 23 ONWARD S OF THE SAID ORDER. THE TRIBUNAL WHILE DECIDING THE ISSUE OF DEEMED APPROVAL, HAD RE LIED ON THE FULL BENCH DECISION OF HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. MUZAFAR NAGAR DEVELOPMENT AUTHORITY, 372 ITR 90. REFERENCE WAS MADE VIDE PARA 24 OF THE ORDER OF TRIBUNAL. FURTHER, VIDE PARA 26 RELYING ON THE RATIO LAID DOW N BY THE LARGER BENCH OF THE HON'BLE ALLAHABAD HIGH COURT (SUPRA.), THE ISSUE OF DEEMED APPROVAL WAS DENIED TO THE ASSESSEE AND ASSESSEE WAS HELD TO BE NOT ENTITLED T O THE AFORESAID DEDUCTION CLAIMED UNDER SECTION 10(23C)(VI) OF THE ACT, IN THE ABSENC E OF APPROVAL BEING GRANTED BY PRESCRIBED AUTHORITY. THE TRIBUNAL ALSO UPHELD THE ORDER OF ASSESSING OFFICER IN TREATING THE ASSESSEE AS AOP INSTEAD OF AN INSTITUT ION SOLELY EXISTING FOR IMPARTING EDUCATION. 3. THE PLEA OF THE APPLICANT BEFORE US, VIDE PRESEN T MISCELLANEOUS APPLICATION IS THAT THE VERY SAME ISSUE OF DEEMED APPROVAL HAS BEE N RECENTLY DECIDED BY THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. SOCIET Y FOR THE PROMOTION OF EDUCATION, 382 ITR 6. THE APPLICANT THUS, CONTENDED THAT THE F ULL BENCH DECISION IN THE CASE OF CIT VS. MUZAFAR NAGAR DEVELOPMENT AUTHORITY (SUPRA) WAS IMPLIEDLY OVERRULED AND THE EARLIER DECISION OF THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF SOCIETY FOR THE PROMOTION OF EDUCATION ADVENTURE SPORT AND CONSERVA TION OF ENVIRONMENT VS. CIT, 261 CTR (ALL) 167 IS CONFIRMED. THE APPLICANT FURTH ER SUBMITTED THAT THE ISSUE OF DEEMED APPROVAL HAS BEEN FINALLY DECIDED IN FAVOUR OF ASSESSEE CONSIDERING THE ABOVE REFERRED APEX COURT DECISION. APPLICANT FURTH ER CONTENTED THAT A PARTICULAR ISSUE GETS DECIDED AT AN ANTERIOR STAGE AND THE VERY SAME ISSUE GETS DECIDED IN A CONTRARY MANNER, SUBSEQUENTLY, EITHER BY THE JURISDICTIONAL HIGH COURT OR BY THE SUPREME COURT, A MISTAKE APPARENT FROM RECORD ARISES. IT IS A SETTLED PROPOSITION THAT A DECISION OF THE APEX COURT LEADS TO DECLARATION OF LAW AS IT WAS FROM THE VERY BEGINNING. AS SUCH, A SUBSEQUENT DECISION OF THE SUPREME COURT, O N THE VERY SAME ISSUE DECIDED 3 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 OTHERWISE IN ANY ASSESSMENT/ APPEAL EARLIER, GIVE R ISES TO AN APPARENT /PRIMA FACIE MISTAKE AND THE SAME CAN BE RECTIFIED AS PER THE SC HEME OF THE INCOME TAX ACT, 1961. IN THIS REGARD, THE DECISION OF HON'BLE SUPRE ME COURT IN THE CASE ACIT VS. SAURASHTRA KUTCH STOCK EXCHANGE LIMITED, 305 ITR 22 7 IS RELEVANT. THE APPLICANT THUS SUBMITTED THAT AN APPARENT ERROR HAS CREPT IN THE APPELLATE ORDER OF THE TRIBUNAL DATED 30.11.2015. AS SUCH, IT IS A SINCERE PRAYER O F THE APPLICANT THAT THE ORDER DATED 30.11.2015 MAY PLEASE BE RECALLED ON THIS LIMITED I SSUE OF DEEMED APPROVAL. 4. DURING THE COURSE OF HEARING OF MISCELLANEOUS AP PLICATION, THE LD. AR FOR THE APPLICANT TOOK US THROUGH THE CONTENTS OF MISCELLAN EOUS APPLICATION AND POINTED OUT THAT EARLIER APPLICATION FOR APPROVAL UNDER SECTION 10(23C)(VI) OF THE ACT WAS FILED ON 22.10L.2002 ALONG WITH RETURN OF INCOME FOR ASSESSM ENT YEAR 2002-03. THIS PLEA OF THE APPLICANT IS NOTED AT PARA 20 OF THE ORDER OF TRIBU NAL. HE FURTHER POINTED OUT THAT AUTHORITIES BEFORE WHOM APPLICATION IN FORM-56D WAS TO BE FILED, WAS BEFORE CCIT THROUGH COMMISSIONER. HE FURTHER POINTED THAT APPL ICANT, FOR THE FIRST TIME, FILED APPLICATION BEFORE CIT-V, AKURDI FOR ALL EARLIER YE ARS ON 14.03.2006. THE COPY OF WHICH IS PLACED AT PAGES 101 TO 104 OF THE PAPER BOOK. TH E LD. AR FOR THE APPLICANT REFERRED THE DECISION OF HON'BLE SUPREME COURT IN THE CASE O F CIT VS. SOCIETY FOR THE PROMOTION OF EDUCATION (SUPRA.) AND POINTED OUT THA T IT HAS BEEN HELD SIX MONTHS THEREAFTER I.E. FROM THE DATE OF FILING OF APPLICAT ION, REGISTRATION IS DEEMED TO BE GRANTED TO THE APPLICANT. HE FAIRLY ADMITTED THAT PRESENT M ISCELLANEOUS APPLICATIONS RELATING TO ASSESSMENT YEAR 2002-03 TO 2004-05 WERE TAX NEUTRAL . THE APPLICANT WAS AGGRIEVED BY DENIAL OF DEDUCTION UNDER SECTION 10(23C)(VI) OF THE ACT FOR THE ASSESSMENT YEAR 2007-08. 5. THE LD. DR FOR THE REVENUE REFERRING TO THE DEC ISION OF HON'BLE SUPREME COURT AND FULL BENCH DECISION OF HON'BLE ALLAHABAD HIGH COURT POINTED OUT THAT THE 4 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 ISSUE ARISING IN THE PRESENT MISCELLANEOUS APPLICAT ION WAS WHETHER BY DECISIONS OF HON'BLE SUPREME COURT, FULL BENCH DECISION OF HON' BLE ALLAHABAD HIGH COURT WAS OVERRULED. 6. THE LD. AR FOR THE APPLICANT IN REJOINDER REFERR ED TO THE COMPUTATION OF INCOME IN THE HANDS OF THE APPLICANT BY THE ASSESSING OFFI CER WHEREIN THE DEDUCTION CLAIMED ON CAPITAL OUTLAY/ ASSET WAS DENIED TO THE ASSESSEE . 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORD. THE TRIBUNAL VIDE ORDER DATED 30.11.2015, IN THE BUNCH OF APPEALS FIL ED BY ASSESSEE HAD DECIDED THE ISSUE OF GRANTING APPROVAL UNDER SECTION 10(23C)(VI ) OF THE ACT. FACTUAL ASPECTS OF THE CASE OF ASSESSEE WERE NOTED BY THE TRIBUNAL IN PARA 9 ONWARDS. THE TRIBUNAL FIRST DEALT WITH THE ISSUE OF REASSESSMENT UNDER SECTION 147/148 OF THE ACT. THEREAFTER, THE ISSUE OF DEEMED APPROVAL WAS TAKEN UP BY THE TRIBUN AL VIDE PARA 23. THE ASSESSEE HAD FILED APPLICATION BEFORE COMMISSIONER FOR GRANT ING APPROVAL UNDER SECTION 10(23C)(VI) OF THE ACT VIDE APPLICATION DATED 31.03 .2006. THE PLEA OF THE APPLICANT BEFORE TRIBUNAL WAS THAT SINCE THE COMMISSIONER HAD FAILED TO PASS AN ORDER WITHIN A PERIOD OF SIX MONTHS FROM THE DATE OF FILING OF THE APPLICATION THEN DEEMED APPROVAL IS GRANTED UNDER SECTION 10(23C)(VI) OF THE ACT. 8. THE LD. DR FOR THE REVENUE RELIED ON THE DECISIO N OF LARGER BENCH OF HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. MUZAFAR NAGAR DEVELOPMENT AUTHORITY (SUPRA.). THE TRIBUNAL RELYING ON THE SAID RATIO LA ID DOWN BY LARGER BENCH OF HON'BLE ALLAHABAD HIGH COURT HELD AS UNDER: 26. IN VIEW OF THE RATIO LAID DOWN BY THE LARGER BE NCH OF THE HONBLE ALLAHABAD HIGH COURT (SUPRA) AND IN THE FACTS OF THE PRESENT CASE, WHERE ADMITTEDLY, THE ASSESSEE HAD NOT RECEIVED THE APPROVAL FROM THE PRE SCRIBED AUTHORITY UNDER SECTION 10(23C)(VI) OF THE ACT, IT COULD NOT BE SAID THAT N ON-DISPOSAL OF AN APPLICATION UNDER SECTION 10(23C)(VI) OF THE ACT WOULD RESULT IN DEEM ED GRANT OF APPROVAL TO THE ASSESSEE, ENABLING IT TO CLAIM DEDUCTION UNDER SECT ION 10(23C)(VI) OF THE ACT. WE ARE NOT GOING INTO THE MERITS OF VARIOUS APPLICATIONS F ILED BY THE ASSESSEE EITHER ALONG WITH RETURN OF INCOME AND / OR NOT BEFORE THE CCIT, PUNE , IN VIEW OF OUR RELIANCE ON THE RATIO 5 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 LAID DOWN BY LARGER BENCH OF HONBLE ALLAHABAD HIGH COURT (SUPRA). THUS, WE FIND NO MERIT IN THE PLEA OF THE ASSESSEE IN THIS REGARD AN D UPHOLDING THE ORDER OF CIT(A), WE HOLD THAT THE ASSESSEE IS NOT ENTITLED TO THE AFORE SAID DEDUCTION UNDER SECTION 10(23C)(VI) OF THE ACT, IN THE ABSENCE OF A APPROVA L BEING GRANTED BY THE PRESCRIBED AUTHORITY. WE ALSO UPHOLD THE ORDER OF ASSESSING OF FICER IN TREATING THE ASSESSEE AS AOP INSTEAD OF AN INSTITUTION SOLELY EXISTING FOR I MPARTING EDUCATION. 9. THE CASE OF THE APPLICANT VIDE PRESENT MISCELLAN EOUS APPLICATIONS IS THAT THE SAID DECISION OF THE LARGER BENCH OF THE ALLAHABAD HIGH COURT STANDS OVERRULED BY THE HON'BLE SUPREME COURT OF INDIA VIDE DECISION IN THE CASE OF CIT VS. SOCIETY FOR THE PROMOTION OF EDUCATION(SUPRA.). THE RELEVANT FINDIN GS OF THE HON'BLE SUPREME COURT ARE AS UNDER: 3. THE SHORT ISSUE IS WITH REGARD TO THE DEEMED REGIST RATION OF AN APPLICATION UNDER SECTION 12AA OF THE INCOME TAX ACT. THE HIGH COURT HAS TAKEN THE VIEW THAT ONCE AN APPLICATION IS MADE UNDER THE SAID PRO VISION AND IN CASE THE SAME IS NOT RESPONDED TO WITHIN SIX MONTHS, IT WOULD BE TAKEN THAT THE APPLICATION IS REGISTERED UNDER THE PROVISION. 4. THE LEARNED ADDITIONAL SOLICITOR GENERAL APPEARI NG FOR THE APPELLANTS , HAS RAISED AN APPREHENSION THAT I N THE CASE OF THE RESPONDENT, SINCE THE DATE OF APPLICATION WAS OF 24 . 02 . 2003, AT T HE WORST, THE SAME WOULD OPERATE ONLY AFTER SIX MONTHS FROM THE DATE OF THE APPLICATION . 5 . WE SEE NO BASIS FOR SUCH AN APPREHENSION SINCE THAT IS THE ONLY LOGICAL SENSE IN WHICH THE JUDGMENT COULD BE UNDERSTOOD . THEREFORE, IN ORDER TO DISABUSE ANY APPREHENSION, WE MAKE IT CLEAR THAT TH E REGISTRATION OF THE APPLICATION UNDER SECTION 12AA OF THE INCOME TAX AC T IN THE CASE OF THE RESPONDENT SHALL TAKE EFFECT FROM 24.08.2003. 6. SUBJECT TO THE ABOVE CLARIFICATION AND LEAVING A LL OTHER QUESTIONS OF THE LAW OPEN, THE APPEAL IS DISPOSED OF WITH NO ORDER AS TO COSTS. 10. SINCE THE ISSUE, NOW HAS BEEN DECIDED BY THE HO N'BLE SUPREME COURT. THEN IN SUCH CIRCUMSTANCES, CONTRARY VIEW TAKEN BY THE TRIB UNAL IS TO BE RECTIFIED SINCE THE MISTAKE APPARENT FROM RECORD ARISES IN THE CASE OF APPLICANT. SUCH IS A VIEW TAKEN BY THE HON'BLE SUPREME COURT IN THE CASE OF ACIT VS. S AURASHTRA KUTCH STOCK EXCHANGE LIMITED (SUPRA.). ACCORDINGLY, THERE IS MERIT IN TH E MISCELLANEOUS APPLICATION FILED BY ASSESSEE FOR ASSESSMENT YEAR 2007-08 WHEREIN THE AS SESSEE HAD FILED APPLICATION BEFORE THE COMMISSIONER FOR GRANTING APPROVAL UNDER SECTION 10(23C) (VI) OF THE ACT ON 31.03.2006. IN VIEW OF THE DICTATE OF THE HON'BL E SUPREME COURT IN CIT VS. SOCIETY 6 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 FOR THE PROMOTION OF EDUCATION (SUPRA.) WHICH IS IN RESPECT OF APPLICATION MADE UNDER SECTION 12AA OF THE ACT WHICH IS PARAMETERIA TO PRO VISIONS OF SECTION 10(23C)(VI) OF THE ACT, WE HOLD THAT SINCE THE COMMISSIONER HAS NO T DISPOSED OFF APPLICATION DATED 31.03.2006 WITHIN PERIOD OF SIX MONTHS, THE REGISTR ATION IS DEEMED TO BE GRANTED TO THE ASSESSEE W.E.F. 30.09.2006 I.E. AFTER EXPIRY OF SIX MONTHS FROM THE DATE OF MAKING APPLICATION. HENCE, APPLICANT IS ENTITLED TO GRANT DEDUCTION UNDER SECTION 10(23C)(VI) OF THE ACT W.E.F 30.09.2006 WHICH FALLS WITHIN ASSESSM ENT YEAR 2007-08. THUS, MISCELLANEOUS APPLICATION NO. 49/PUN/2016 IS ALLOWE D. 11. HOWEVER, MISCELLANEOUS APPLICATIONS NO. 46 TO 4 8/PUN/2016 RELATING TO ASSESSMENT YEAR 2002-03 TO 2004-05 ARE DISMISSED, S INCE THE APPLICATION BEFORE COMMISSION WAS FILED FOR THE FIRST TIME ON 31.03.20 06; EARLIER APPLICATION MOVED BEFORE ASSESSING OFFICER ALONG WITH RETURN OF INCOM E OR OTHERWISE ARE NOT AS PER REQUIREMENTS OF THE ACT AND HENCE, APPLICANT WAS NO T ENTITLED TO GRANT OF ANY APPROVAL IN ASSESSMENT YEAR 2002-03 TO 2004-05. THE LD. AR F OR THE ASSESSEE HAS POINTED OUT THAT IN THE MISCELLANEOUS APPLICATIONS RELATING TO ASSESSMENT YEAR 2002-03 TO 2004-05 WERE TAX NEUTRAL, HENCE ARE DISMISSED. 12. IN THE RESULT, MISCELLANEOUS APPLICATIONS NO. 46 TO 48/PUN/2016 ARE DISMISSED AND MISCELLANEOUS APPLICATION NO. 49/PUN/2016 IS AL LOWED. ORDER PRONOUNCED ON THIS 05TH DAY OF JUNE, 2018. SD/- SD/- (ANIL CHATURVEDI) (SUSHMA CHOWLA) /ACCOUNTANT MEMBER /JUDICIAL MEMBER / PUNE; / DATED : 05 TH JUNE, 2018. SB 7 MA NOS.46 TO 49/PUN/2016 A.YS. 2002-03 TO 2004-05 & 2007-08 ! '! / COPY OF THE ORDER FORWARDED TO : 1. !' / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(A)-1, PUNE. 4. THE CIT-1, PUNE. 5. #$%' &' , !' !&' , (' ()* , / DR, ITAT, B BENCH, PUNE. 6. %+, -. / GUARD FILE. // TRUE COPY // / / BY ORDER, 0' &* / PRIVATE SECRETARY !' !&' , / ITAT, PUNE.