THE JUTE CORPORATION OF INDIA LTD. CONTRIBUTORY PROVIDENT FUND,KOLKATA. V. COMMISSIONER OF INCOME TAX, APPEAL, ADDL/JCIT (A) JODHPUR

SA 5/KOL/2025

AI Insights

The Jute Corporation of India Ltd. Contributory Provident Fund filed stay petitions against the demands raised for three assessment years, totaling approximately Rs. 13.41 crores. The primary contention was that the assessee, being a mutual fund for the employees of a public sector undertaking, does not generate taxable income, and thus, the demands are unjustified. The Income Tax Department had initially processed the returns and raised the demands, which were contested in the appeals. The Tribunal, considering the nature of the assessee and the pending appeals, decided to grant a stay on the demands, subject to the payment of 20% of the demands or equivalent securities.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 36403 (ITAT-KOLKATA)
• Appeal Type: Stay Application
• Pronouncement Date: 26-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2014-2015
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Application of stay
• Section: 143(1)

Judgement Text

"आयकर अपीलीय अधिकरण कोलकाता 'ए' पीठ, कोलकाता में IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA ‘A’ BENCH, KOLKATA श्री प्रदीप क ुमार चौबे, न्याधयक सदस्य एवं श्री राक ेश धमश्रा, लेखा सदस्य क े समक्ष Before SHRI PRADIP KUMAR CHOUBEY, JUDICIAL MEMBER & SHRI RAKESH MISHRA, ACCOUNTANT MEMBER S.A. Nos.: 4, 5 & 6/KOL/2025 In I.T.A. No.: 953, 856 & 2287/KOL/2024 Assessment Years: 2013-14, 2014-15 & 2018-19 The Jute Corporation of India Ltd. Contributory Provident Fund Vs. Addl./JCIT(A)-Jodhpur, Assessment Unit, Income Tax Department, Kolkata (Appellant) (Respondent) PAN: AAATT2503R Appearances: Assessee represented by : Hiran Das, AR. Department represented by : Sailen Samadder, Addl. CIT, Sr. DR Date of concluding the hearing : February 21st, 2025 Date of pronouncing the order : February 26th, 2025 ORDER PER BENCH: The assessee has filed the present Stay Petitions SA Nos. 4, 5 & 6/KOL/2025 in I.T.A. No.: 953, 856 & 2287/KOL/2024 for the Assessment Years: 2013-14, 2014-15 & 2018-19 respectively requesting for stay of demand of Rs. 4,46,06,910/-, Rs. 4,71,24,710/- and Rs. 4,23,76,604/- respectively. All the petitions were heard together Page | 2 S.A. Nos: 4,5,6/KOL/2025 The Jute Corporation of India Ltd. Contributory Provident Fund. and are being decided vide this common order for the sake of convenience and brevity. 2. We will take up the case of A.Y. 2013-14 first. Brief facts of the case are that the return of income for the A.Y. 2013-14 was originally filed on 26.03.2015, which was considered as defective by the Ld. AO under section 139(9) of the Act. It was processed under section 143(1) on 16/03/2016 and a rectified return was filed on 31st March, 2017. The assessee preferred an appeal before the Ld. Addl./Joint CIT(A), Jodhpur on 26/12/2023. This appeal was disposed of on the ground that the same was not in conformity with the provisions of section 249 (2) of the Act and there was no sufficient cause for condonation of the delay in filing the appeal; hence the appeal was not maintainable. The merits of the case have not been decided. The assessee challenged the order of the Ld. CIT(A) before the Hon'ble Tribunal vide ITA No. 953/Kolkata/2024 on 16.04.2024 and the demand of Rs. 4,46,06,910/- in its entirety is disputed in the said pending appeal. He has been advised that all the additions/disallowances made in the impugned intimation dated 16/03/2016 would be wholly deleted when the appeal is finally heard and disposed of by the Hon'ble Tribunal. It is stated that the assessee is an intermediary vehicle for the protection of the interests of the employees of the Jute Corporation of India, which is a Public Sector Undertaking of the Government of India and does not have any profit/income objectives. The receipts and payments of the assessee company are covered by the concept of mutuality under the provisions of the Act and there cannot be any scope of income as such. Therefore, any collection of impugned demand will be a forceful and unnecessary exercise and against the provisions of law. It is submitted Page | 3 S.A. Nos: 4,5,6/KOL/2025 The Jute Corporation of India Ltd. Contributory Provident Fund. that the entire income of the assessee is exempt in view of the provisions of the Act. The assessee has therefore, prayed to stay the operation of the said impugned assessment order, including the demand raised in pursuant thereto, and also keep the whole of the said disputed demand raised by the Ld. AO in abeyance till the disposal of the said appeal. The assessee has also mentioned that it is a fit case where the stay should be granted. 3. We have heard the rival contentions and examined the facts of the case. As regards the request for setting aside the order dated 09.02.2024 of the Ld. CIT(A), the same cannot be decided while considering the stay petition as the assessee has filed an appeal against the same before the Hon'ble Tribunal which is pending. Further, as regards the stay of demand till the appeal of the assessee is decided by the Tribunal, the relevant provisions of the first proviso to section 254(2A) were brought to the notice of the Ld. AR and the Bench enquired whether the assessee was willing to pay 20% of the outstanding demand for which the Ld. AR expressed his inability to do so. Therefore, the stay petition is allowed subject to the following conditions: (i) The assessee shall pay 20% of the outstanding demand of Rs.4,46,06,910/- (i.e. Rs. 89,21,382/-) for A.Y. 2013-14 within a period of one month from the date of receipt of this order or furnish the required security of an equal amount. Similarly, Rs. 94,24,942/- and Rs.84,75,321/- being 20% of the outstanding demand for A.Y. 2014-15 and A.Y. 2018-19 respectively shall also be paid within a period of one month from the date of receipt of this order or the securities for equal amounts shall be furnished. Page | 4 S.A. Nos: 4,5,6/KOL/2025 The Jute Corporation of India Ltd. Contributory Provident Fund. (ii) Subject to the payment of the demand as at (i), the rest of the demands for all the three assessment years shall be stayed for a period of 180 days or till the disposal of the appeals, whichever is earlier. (iii) No adjournment shall be sought by the assessee in the appeals before the Tribunal for any of these three assessment years unless it is absolutely necessary on account of any exigency or unavoidable circumstances. 4. In the result, all the three Stay Applications filed by the assessee are allowed as above. Order pronounced in the open Court on 26th February, 2025. Sd/- Sd/- [Pradip Kumar Choubey] [Rakesh Mishra] Judicial Member Accountant Member Dated: 26.02.2025 Bidhan (P.S.) Page | 5 S.A. Nos: 4,5,6/KOL/2025 The Jute Corporation of India Ltd. Contributory Provident Fund. Copy of the order forwarded to: 1. The Jute Corporation of India Ltd., 7th Floor, Hudco Building, 15N, Nellie Sengupta Sarani, Kolkata, West Bengal, 700087. 2. The Jute Corporation of India Ltd. Contributory Provident Fund, 15N, Nellie Sengupta Sarani, New Market S.O., Kolkata, West Bengal, 700087. 3. DCIT, Circle-1(2), Kolkata 4. Addl./JCIT(A)-Jodhpur 5. Assessment Unit, Income Tax Department, Kolkata. 6. CIT(A)- 7. CIT- 8. CIT(DR), Kolkata Benches, Kolkata. 9. Guard File. //True copy // By order Assistant Registrar ITAT, Kolkata Benches Kolkata "