M/s.Jubilee Hills International Centre., Hyderabad V. Income Tax Officer, Hyderabad

MA 89/HYD/2008

• Counselvise Citation: [2013] 123 COUNSELVISE.COM (IT) 9844 (ITAT-HYDERABAD)
• Duration Of Justice: 8 year(s) 1 month(s) 2 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-01-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2001-2002
• Appeal Filed On: 02-12-2004
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: V V RAMANA RAO
• Assessee Lawyers: M V R PRASAD

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER MA NO. 89/HYD/2008 ARISING OUT OF ITA NO. 1135/HYD/2004 ASSESSMENT YEAR 2001-02 M/S. JUBILEE HILLS INTERNATIONAL CENTRE, HYDERABAD PAN: AAAAJ1197L VS. THE INCOME TAX OFFICER WARD-6(3) HYDERABAD APPELLANT RESPONDENT APPELLANT BY: SRI M.V.R. PRASAD RESPONDENT BY: SRI V.V. RAMANA RAO DATE OF HEARING: 04.01.2013 DATE OF PRONOUNCEMENT: 04.01.2013 O R D E R PER CHANDRA POOJARI, AM: THIS IS THE SECOND MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE SEEKING RECALL OF THE ORDER OF THE TRIBUNA L DATED 9.8.05 IN ITA NO. 1135/HYD/2004 FOR ASSESSMENT YEAR 2001-0 2. 2. THE LEARNED AR FILED A DETAILED PETITION POINTING O UT VARIOUS MISTAKES SAID TO BE CREPT IN THE ORDER OF T HE TRIBUNAL (CITED SUPRA). ADMITTEDLY THIS IS THE SECOND MA AL LEGING THE SAME MISTAKES WHICH WAS DISPOSED OF BY THE TRIBUNAL VIDE ITS ORDER DATED 2.2.2007 IN MA NO. 119/HYD/2005 OBSERVI NG AS FOLLOWS: '5.2 IT IS TRUE THAT THERE IS A MISTAKE IN PARA 14 .2 OF THE ORDER OF THE TRIBUNAL. WE, THEREFORE, MODIF Y THE SAME AS UNDER: '14.2 REVENUE TOOK THE DISPUTE IN THE CASE OF BANKIPUR CLUB AND RANCHI CLUB TO THE HONBLE SUPREME COURT. THE APEX COURT IN THEIR JUDGEMENT MENTIONED SUPRA UPHELD THE MA NO. 89/HYD/2008 M/S. JUBILEE HILLS INTERNATIONAL CENTRE ========================== 2 DECISION OF THE HONBLE PATNA HIGH COURT TO THE EFFECT THAT ONLY INCOME FROM TRANSACTIONS WHICH SATISFIED THE CONDITION OF THE MUTUALITY ARE EXEMPT FROM TAX. IT IS CLEAR FROM THE ABOVE DECISIONS THAT AN ENTITY CAN HAVE BOTH MUTUAL AND NON-MUTUAL ACTIVITIES AND THE SURPLUS ARISING OUT OF MUTUAL ACTIVITY ALONE IS NOT TAXABLE. THE TWIN TESTS OF MUTUALITY ARE: I) THERE SHOULD BE COMPLETE IDENTITY OF THE CONTRIBUTORS TO THE COMMON FUND AND THE PARTICIPATORS TO THE SURPLUS; AND II) THE CONTRIBUTORS TO THE COMMON FUND SHOULD HAVE RIGHT OF DISPOSAL OVER THE SURPLUS. 5.3 ALSO IN PARA 15 OF THE ORDER OF THE TRIBUNAL THERE ARE CERTAIN MISTAKES. WE CORRECT THE SAME AS UNDER: 'COMING TO THE PRESENT CASE, WE FIND THAT NON- PERMANENT AND NON-LIFE MEMBERS DO NOT HAVE ANY VOTING RIGHT. THEY ARE NEITHER PART OF GENERAL BODY NOR CAN THEY PARTICIPATE AS MEMBERS OF THE GOVERNING COUNCIL. THEY, THEREFORE, CANNOT PARTICIPATE IN THE MANAGEMENT OF THE CENTRE AND HAVE NO RIGHT OF DISPOSAL OVER THE SURPLUS IN CASE OF DISSOLUTION OF THE CENTRE. IN THIS VIEW OF THE MATTER, WE HOLD THAT THE PRINCIPLE OF MUTUALITY LAID DOWN BY THE HONBLE SUPREME COURT IN THE CASE OF BANKIPUR CLUB LTD. (SUPRA) IS NOT SATISFIED WITH REFERENCE TO TRANSACTIONS ENTERED INTO BY THE CENTRE WITH THE NON- PERMANENT AND NON-LIFE MEMBERS. THE ORDER OF THE LD. CIT(A) IS CONFIRMED ON THIS ISSUE. THIS GROUND OF APPEAL IS DISMISSED.' 6. WE ARE OF THE CONSIDERED OPINION THAT THERE IS NO OTHER MISTAKE WHICH IS CAPABLE OF BEING RECTIFIED UNDER SEC. 254(2) OF THE ACT. 7. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE ASSESSEE IS ALLOWED TO THE ABOVE EXTENT.' MA NO. 89/HYD/2008 M/S. JUBILEE HILLS INTERNATIONAL CENTRE ========================== 3 3. FURTHER, AGAINST THE ORDER PASSED BY THE TRIBUNAL D ATED 9.8.2005, THE HONBLE JURISDICTIONAL HIGH COURT HAS PASSED INTERIM ORDERS AS UNDER: '17.10.2005 ITTA M P NO. 221 OF 2005 IN ITTA NO. 205 OF 2005 'THERE SHALL BE INTERIM SUSPENSION SUBJECT TO THE CONDITION OF THE PETITIONER DEPOSITING A FURTHER SUM OF RUPEES FIVE LAKHS APART FROM THE AMOUNT STATED TO HAVE BEEN ALREADY PAID, WITHIN A PERIOD OF FOUR WEEKS FAILING OF WHICH THE STAY PETITION SHALL STAND DISMISSED.' SD/- ASST. REGISTRAR' 4. AGAINST THE ORDER PASSED BY THE TRIBUNAL U/S. 254(2 ) FOR THE SAME ASST. YEAR 2001-02 THE HONBLE JURISDICTIO NAL HIGH COURT HAS PASSED THE FOLLOWING ORDER: '21.6.2007 ITTA MP NO. 141/07 IN ITTA NO. 212/07 'IN VIEW OF THE INTERIM ORDERS HAVING BEEN PASSED IN ITTA NO. 205 OF 2005 NO INTERIM ORDERS ARE NECESSARY TO BE PASSED IN THIS PETITION, WHICH IS ACCORDINGLY DISMISSED.' SD/- ASST. REGISTRAR' 5. AS SEEN FROM THE ABOVE, THE SUBJECT MATTER DISPUTED IN THIS MA IS PENDING BEFORE THE HONBLE JURISDICTIONA L HIGH COURT AND THE HIGH COURT FOR THE TIME BEING GRANTED INTER IM SUSPENSION OF THE ORDER OF THE TRIBUNAL. BEING SO, IN OUR OPINION, THE ORDER OF THE TRIBUNAL IN ITA NO. 1135/ HYD/04 IS NOT IN OPERATION AS OF NOW. HENCE, WE ARE NOT IN A POS ITION TO EXPRESS ANY OPINION ON THE MA FILED BY THE ASSESSEE AS IT IS SUB- MA NO. 89/HYD/2008 M/S. JUBILEE HILLS INTERNATIONAL CENTRE ========================== 4 JUDICE. ACCORDINGLY, WE ARE INCLINED TO DISMISS TH E MA FILED BY THE ASSESSEE. 6. IN THE RESULT, THE MA FILED BY THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 4 TH JANUARY, 2013. SD/ - (ASHA VIJAYARAGHAVAN) JUDICIAL MEMBER SD/ - (CHANDRA POOJARI) ACCOUNTANT MEMBER HYDERABAD, DATED THE 4 TH JANUARY, 2013 COPY FORWARDED TO: 1. M/S. JUBILEE HILLS INTERNATIONAL CENTRE, ROAD NO. 1 4, JUBILEE HILLS, HYDERABAD. 2. THE INCOME TAX OFFICER, WARD - 6(3), HYDERABAD. 3. THE CIT(A) - I V , HYDERABAD 4. THE CIT - I, HYDERABAD. 5. THE DR A BENCH, ITAT, HYDERABAD. TPRAO