Income Tax Appellate Tribunal - Mumbai
Mumbai Metroplititan Region ... vs Assessee on 10 April, 2015
आयकर अपील य अ धकरण "बी" यायपीठ मुंबई म।
IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI ी डी. म मोहन, उपा य एवं ी संजय अरोड़ा, लेखा सद य के सम ।
BEFORE SHRI D. MANMOHAN, VP AND SHRI SANJAY ARORA, AM व वध आवेदन सं./MA No. 126/Mum/2014 (Arising out of ITA No. 625/Mum/2012) & ITA No. 625/Mum/2012 ( नधारण वष / Assessment Years: 2009-10) Mumbai Metropolitan Region Director of Income Tax (Exemption), Development Authority Mumbai बनाम/ Plot No.C-14 and C-15, Bandra Kurla Complex, Bandra (E), Vs. Mumbai-400 051 थायी ले खा सं . /जीआइआर सं . /PAN/GIR No. AAATIM 7016 R (Applicant) : (Respondent) अपीलाथ क ओर से / Appellant by : Shri S. E. Dastur & Shri Madhur Agarwal यथ क ओर से/Respondent by : Shri Rajiv Panth & Shri Neil Philip सुनवाई क तार ख / : 08.08.2014 & 16.01.2015 Date of Hearing घोषणा क तार ख / : 10.04.2015 Date of Pronouncement आदे श / O R D E R Per Sanjay Arora, A. M.:
This is a Miscellaneous Petition by the Assessee, i.e., for assessment year (A.Y.) 2009-10, in respect of the order by the Tribunal dated 31.12.2013 in it's case for the said year.
2. Vide its instant application the assessee seeks a recall of its order afore-referred by the Tribunal for deciding its appeal afresh in accordance with law. In the alternative, the tribunal can, where the parties consent thereto; it having already heard the parties at 2 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) length, proceed to decide assessee's Ground #1, which it refrained to while passing the impugned order.
3.1 The assessee's case, as projected by the ld. senior counsel, Sh. S.E. Dastur, before us, was that the sole and the only reason for the Revenue in withdrawing its registration u/s. 12A of the Act as a charitable institution, granted on - 22.07.2002 (PB pg.39), with effect from assessment year (AY) 2009-10, is the invocation of section 2(15), i.e., read with proviso thereto, effective from the said assessment year, contending that the proviso to section 2(15) is applicable to it and, therefore, it is no longer a charitable institution. The assessee appealed there-against, contesting the said withdrawal (u/s.12AA(3)) on both counts. Firstly, the proposition per se that informs the withdrawal under reference, so that an application of proviso section 2(15) would itself operate to be a ground for the withdrawal of registration (per Gd. #1). Vide Ground 2, the assessee, without prejudice, disputed the applicability of the proviso to section 2(15), i.e., on facts. This was for the reason that if the assessee's case is decided in its favour on the legal plea raised per Gd.1, there would be no necessity to decide its Gd. 2. The Tribunal, however, without deciding its ground no.1, proceeded to decide Gd. 2, i.e., the alternate ground. This, despite as many as six decisions being relied upon by the assessee in its favour on that ground (Gd. # 1), which though stand duly reported at para 3.1 of its order. In fact, it does not even decide the same (Gd.2), restoring the matter back to the file of ld. DIT(E) to decide the same. It was not permissible for the tribunal to do so, i.e., without deciding Gd.1.
Continuing further, making reference to the show cause notice dated 13.12.2011 (at PB pg. 40); the assessee's reply thereto in the proceedings before the ld. DIT(E) dtd. 26.12.2011 (PB pgs. 41-55), as well as his order u/s. 12AA(3) withdrawing registration, it was argued that the tribunal in requiring the ld. DIT(E) to examine the issue of the said withdrawal with reference to the conditions of section 12AA(3), i.e., that the activities of trust or institution are genuine or are being carried out in accordance with subjects, traveled outside the scope of the appeal and, thus, exceeded its jurisdiction. The power of the tribunal u/s.254(1), howsoever wide, is not absolute and is confined to the grounds 3 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) raised, and for which reliance was placed on decision of the hon'ble Bombay High Court in the case of Pokhraj Hirachand v. CIT [1963] 49 ITR 293 (Bom) and J.B. Greaves IT v. CIT [1963] 49 ITR 107 (Bom). On his attention being drawn to the rule 11 of the Appellate Tribunal Rules, 1963, which provides for the tribunal being not confined to the grounds raised before it per the memo of appeal, so that it can, where deemed fit and proper, consider a ground deemed relevant, of course after allowing parties opportunity to state their case reference thereto, it was explained by him that the cited decisions considered the ambit of the relevant rules, i.e., rules 11,12 and 27, which are para materia to rules 11 and 27 of the Appellate Tribunal Rules, 1963. Toward the same, copy of the relevant rules (being under the 1922 Act), were also placed on record. The tribunal, he continued, can decide in the appellant's favour on any other ground. Reference was further made by him to the decisions in the case of Jasmine Commercials Ltd. vs. CIT [2011] 56 DTR 159/200 Taxman 338 (Cal) (pages 5,6); ACIT v. Saurashtra Kutch Stock Exchange Limited [2008] 305 ITR 227 (SC); and M. Visvesvaraya Industrial Research & Development Centre vs. ITAT & Others [2001] 251 ITR 852 (Bom) (pages 855 and 856) and 54 SOT 74 (at page 85). Ground not considered is also a mistake apparent from record, for which reference was made by him to the decisions in the case of CIT v. Keshav Fruit Mart [1993] 199 ITR 771 (All); Commissioner of Income Tax v. K.M. Sugar Mills (P.) Ltd. [2005] 275 ITR 247 (All); and CIT vs. Ramesh Chand Modi [2001] 249 ITR 323 (Raj.). In Kansai Nerolac Paint s. Dy. CIT (in ITA No. 1030 of 2011 dated 06.05.2014/copy on record), the hon'ble jurisdictional court held that where there was the material before the tribunal to decide the issue, it would be justified in deciding the same, rather than setting it aside to the file of a lower authority/s to decide afresh.
3.2 The ld. DR, on the other hand, did not raise any specific objection, being content in relying on the impugned order, stating that it was a considered decision by the tribunal, not liable for any modification whatsoever.
4. We have heard the parties and perused the relevant material on record. 4.1 We may, to begin with, reproduce the relevant grounds, as under:
4MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) 'GROUND I:
1. On the facts and circumstances of the case and in law, the Director of Income tax (Exemption) ("DIT(E)") erred in withdrawing the registration granted u/s. 12A with retrospective effect from A.Y. 2009-10 on the alleged ground that the activities of the assessee were not for "charitable purpose"
considering the proviso to section 2(15) of the Income Tax Act, 1961("the Act").
2. He failed to appreciate and ought to have held that the power of withdrawal u/s. 12AA(3) could only be on violation of two conditions stipulated under the said section and not otherwise.
3. The Appellant therefore, prays that in absence of such violation, the withdrawal of registration granted u/s. 12A of the Act by invoking powers u/s. 12AA(3) be held as ab-initio void and bad-in-law.
WITHOUT PREJUDICE TO GROUND I:
GROUND II:
1. On the facts and circumstances of the case and in law, the DIT(E) erred in holding that the income from the activities of the Appellant of granting loans to public bodies and the leasing activities of the Appellant are business activities and accordingly, proviso to section 2(15) applies.
2. He failed to appreciate and ought to have held that the activities carried out by the Appellant are in fulfillment of its objects as required by the statute (Mumbai Metropolitan Region Development Authority Act, 1974) and hence cannot be held that such activities amount to carrying on of business activities. .
3. The Appellant therefore prays that it be held that the provision of section 2(15) does not apply to the Appellant and accordingly the activities per se does not amount to carrying on any nature of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business.
WITHOUT PREJUDICE TO GROUND I & II GROUND III
1. On the facts and circumstances of the case and in law, the DIT(E) erred in withdrawing the registration granted u/s 12A retrospectively from A.Y. 2009-10.
5MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E)
2. The Appellant prays that even if it is held that the DIT(E) has validly withdrawn the registration granted u/s 12A of the Act, such order of Withdrawal should be applicable prospectively and not retrospectively with effect from April 1, 2009.' 4.2 The assessee's case has, in our view, two parts to it. Vide the first, the assessee makes out a case that the tribunal could not have traveled to Ground 2, the without prejudice ground, without first answering its Gd.1. It was not open for it to do so, is the assessee's case. This is for the simple reason that being a legal ground, where decided in its favour, there shall be no necessity to decide Ground 2, challenging the application of the proviso to section 2(15), i.e., on facts. It was even otherwise incumbent on the assessee to assume the said ground, lest it be argued that the assessee admits the application of proviso and, thus, section 2(15), to it. The arguments by the assessee during the hearing (of the appeal) qua this ground were toward this end, even as it was impermissible for the tribunal to proceed to decide Gd.2 without first adjudicating Gd. 1. This also broadly defines the assessee's case.
The second limb of the assessee's argument is that the tribunal has in taking up the issue of withdrawal of registration u/s.12AA(3), on the ground of either non-genuineness of its activities or not being carried out in accordance with its objects, traveled outside the scope of the appeal and, thus, acted without jurisdiction.
4.3 The decision of the tribunal is contained at para 5 of its order, which reads as under:
'5. The issue of applicability or otherwise of section 12AA(3) in the instant case being factually indeterminate, we only consider it fit and proper in the facts and circumstances of the case to restore this matter back to the ld. DIT(E) for allowing the assessee a reasonable opportunity to present its case in this regard before him, to be decided per a speaking order and in accordance with law. The ld. DIT(E), though not restricted to the facts and figures for a particular year, shall restrict his inquiry to the factual aspect of the case, i.e., qua the satisfaction of the condition/s of section 12AA(3) on facts. That is, the fact that the first proviso to section 2(15) gets attracted shall not influence or colour the ld. DIT(E)'s factual findings nor by itself be considered as a ground for considering the assessee's activities as not 6 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) genuine or not in accordance with its objects; the same being the subject matter of the legal aspect afore-noted. We do so as the assessee's case would require being examined by the tribunal thereon only if the same survives an examination on facts, i.e., satisfies the test of s. 12AA(3) on facts. We decide accordingly.' The tribunal has, as apparent, not decided Gd.1 for the reason that in its view the question as to whether the conditions for the withdrawal of registration u/s.12AA(3) stands satisfied are not, i.e., de hors section 2(15), needs to be determined first. Finding the facts on record as not leading to the said determination, it restored the matter back to file of the ld. DIT(E). It is this decision that is sought to be impugned as without jurisdiction. Firstly, therefore, it is incorrect to say that the tribunal proceeded to decide the Gd.2 without first addressing Ground 1. Both Gd. 1 & 2 relate to different aspects of section 2(15), and have not been decided by the tribunal, albeit for different reasons. It clearly states that the issue of application (or otherwise) of section 2(15) shall not influence the determination of the issue as to whether the precedent conditions of section 12AA(3) are, in facts and circumstances of the case, met or not. The assessee's first charge is, thus, without basis.
4.4 We, next, come to the second aspect of the matter, whereby with reference to scope of the powers of the tribunal, its' decision is challenged as incompetent. The tribunal's power is, again with reference to case law, pleaded as confined to the grounds of appeal before it, so that the tribunal's action in the present case in traveling outside the specific grounds raised before it, exceeded its jurisdiction. These being rectification proceedings, so that any contentious issue is precluded, we shall, even as indicated during the course of hearing, state the position of law in the matter with reference to the decisions by the apex court, settling the same. In the case of Hukumchand Mills Ltd. vs. CIT [1967] 63 ITR 232 (SC), the subject matter of appeal, in the opinion of the hon'ble apex court, was rightly discerned by the tribunal as the WDV of the building, machinery, etc. of the assessee for calculating the depreciation allowance u/s.10(2)(vi) of the Act (Income Tax Act, 1922). It was clarified that it was open for the Revenue to raise a 7 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) contention in this regard before the tribunal for the first time, supporting the finding of the Appellate Assistant Commissioner (AAC) on any ground decided against it. Even assuming rules 12 and 27 of the Appellate Tribunal Rules were not strictly applicable, the same are procedural in character and not exhaustive of the powers of the tribunal, so that they do not in any way circumscribe or control its power u/s.33(4). The tribunal was accordingly within its jurisdiction to entertain the argument as to depreciation and direct the ITO to find whether any depreciation was actually allowed under the Industrial Tax Rules and, further, whether such depreciation should be taken in the consideration for computing the WDV under the Act.
In CIT vs. S. Nelliappan [1967] 66 ITR 722 (SC), the apex court again has clarified that in deciding the appeal, the tribunal has not restricted to the grounds said forth in the memorandum of appeal or taken by the leave of the tribunal. Following the said decision, the apex court in CIT vs. Assam Travels Shipping Service [1993] 199 ITR 1 (SC) confirmed the decision of the tribunal in remanding the matter back to the file of the AAC to levy penalty in accordance with law, which the said authority found to have been levied by the AO at below the statutory minimum amount prescribed. Though the tribunal did not have power to enhance, it was certainly competent for it to remand the matter back for the purpose to the file of the AAC, who had the necessary power but had declined to exercise it on the mistaken ground that he had no such power. The penalty leviable in accordance with law was, thus, confirmed by the apex court to be issue before the tribunal.
In Martin Burn Ltd. vs. CIT [1993] 199 ITR 606 (SC), the action of the tribunal in remanding the matter back to the ACIT for passing order u/s.263 after making further investigation was upheld. The question arising before the tribunal was perceived as not limited to what had been considered by the CIT, but as also what had not been, but ought to have been, in the exercise of his power in the matter. In CIT vs. National Taj Traders [1980] 121 ITR 535 (SC), the apex court clarified that the time limit of two years prescribed for passing an order u/s.33B by the CIT (corresponding to section 263 of the 8 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) Act), is only for suo motu revision orders passed by the said authority, and not applicable to that passed on the direction by the tribunal.
The hon'ble jurisdictional high court in Ugar Sugar Works Ltd. [1983] 141 ITR 326 (Bom) explained that the power of the tribunal is not confined to the grounds of appeal raised before it but to the subject matter of the appeal. The decision, express or implied, of the AAC, is the subject matter of appeal, and to which therefore the power of the tribunal is restricted to. Subsequently, the hon'ble court, vide its full bench decision in the case of Ahmedabad Electricity Co. Ltd. vs. CIT [1993] 199 ITR 351 (Bom) (FB), upon an extensive review of precedents, clarified that the power or purview of the tribunal shall, as in the case of first appellate authority, extend to the whole assessment, and is not confined to matters raised by the assessee; the whole premise of the appellate procedure under the Act being ascertainment of the correct tax liability of the assessee, i.e., in accordance with the law. The subject matter of appeal was, in its view, to be construed as the subject matter of the assessment. Reference in this context may also be made to its decision in the case of CIT vs. Parthasarathy [1995] 125 CTR 174 (Mad).
The tribunal is, thus, fully empowered in law to frame issue/s raising different aspect/s of the matter before it, decided expressly or impliedly by the authorities below, whose orders are under challenge before it, i.e., is the subject matter of the tax proceedings.
4.5 The next question before us is whether the withdrawal u/s.12AA(3), i.e., de hors section 2(15), was or could be considered as arising out of the order under appeal before the tribunal. Toward this, we have perused the assessee's reply, to the show cause notice; the order u/s. 12AA(3), and the assessee's arguments before us; the show cause notice issued by the ld. DIT(E) (PB page 40) being not referred to during the course of hearing (of the appeal) and, thus, not a part of the tribunal's record (refer rule 18(6) of the Appellate Tribunal Rules). A fair reading of the said order; we being acutely conscious that these are rectification proceedings, reveals that the only issue arising before the tribunal was the invocation of section 12AA(3) consequent to the finding of the 9 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) application of proviso to section 2(15). The issue, which the tribunal considered as the second limb of the matter before it, i.e., the application of s. 12AA(3) independent of s. 2(15), was thus not a subject matter of appeal, and the tribunal had wrongly assumed jurisdiction in its respect. The tribunal, as it appears to us, was moved by the assessee's reply before the ld. DIT(E), stating its activities as genuine and carried out in accordance with it objects (PB pgs. 41-55) as well as its argument before it to the same effect (refer para 3.2 of the impugned order). However, notwithstanding the assessee's arguments and pleadings, the subject matter of appeal cannot exceed the very basis on which section 12AA(3) is sought to be invoked by the Revenue in the present case, i.e., attraction of section 2(15), and which shall comprise the subject matter of appeal, or the controversy attending it. Whether the same is, in fact, attracted or not, is again a part thereof - the said basis - specifically covered by the assessee's Gd. 2. No doubt, the Revenue is not barred in law from raising, and is at liberty to raise, the said issue in another proceedings, even as argued before us by the ld. AR; there being even otherwise no estoppel against law. But, on a fair look at the order u/s. 12AA(3), doing so in the instant proceedings, i.e., the appellate proceedings before the tribunal, would amount to extending the scope thereof inasmuch as the same not contemplated by the said order. The tribunal had clearly exceeded its jurisdiction in directing in the manner it does per para 5 of its order. The said directions are therefore, mistaken, and are hereby withdrawn. The impugned order is accordingly recalled for deciding the assessee's Gds. I & II. We decide accordingly.
5. The next question that confronts is as to how to proceed in the matter to decide the present appeal, i.e., given our admission of a mistake apparent from record and, consequently, the withdrawal afore-stated, which in fact constituted the Tribunals' decision, so that it is also incorrect to state that the same did not constitute a decision. Though of no consequence in view of our acceptance of a mistake by the tribunal in inferring the subject matter of appeal, the assessee having relied on Kansai Nerolac Paint (supra) toward the same, we may meet the said reliance. The said decision is distinguishable inasmuch as in that case the tribunal decided likewise, restoring the 10 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) matter back to the file of the first appellate authority, merely for the reason of the relevant issue having not been decided by the authorities below. It is in those circumstances that the hon'ble court held that the issue before the tribunal being only a legal issue, with all the facts on record, it ought to have decided the same itself rather than by restoring the matter back. By implication, even if, therefore, the two documents on which reliance was placed by the assessee in that case remained to be verified, the tribunal could have made its decision in the said case as subject to the validity, i.e., the veracity of the said documents, by the Revenue. In the present case, on the contrary, restoration by the tribunal was after consideration the facts of the case, finding the facts on record as indeterminate, so that it cannot be said that all the facts are on record or established. The said decision would thus by itself by of no consequence in the instant case.
Order u/s. 254(1)
6. Continuing further, this, therefore, leaves us to decide the assessee's, i.e., appeal grounds 1 and 2, both without prejudice to the other. The parties having during the course of the having accorded consent to our deciding the same, i.e., rather than being heard again; the appeal having been heard at length in the first instance, we proceed to decide the said grounds. The assessee in this regard claims that its Ground #1 would fall to be decided first inasmuch as if decided in its favour, Ground # 2 shall become redundant. True, but then, equally, Ground # 1 shall arise for consideration only it is found as a fact that section 2(15) is applicable thereto. It is pointless to decide Ground 1, i.e., the impact of section 2(15) on registration of an entity as a charitable institution, without first considering if section 2(15), including proviso thereto, is at all attracted in the facts of the case. We shall, therefore, proceed to decide Ground #2 first. Section 2(15) reads as under:
'Definitions.
2. In this Act, unless the context otherwise requires, -
(1) ...........
(2) ...............
(15) charitable purpose includes relief of the poor, education, medical relief, preservation of environment (including watersheds, forests and wildlife and preservation of monuments or places or objects of artistic or 11 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) historic interest, and the advancement of any other object of general public utility.
Provided that the advancement of any other object of general public utility shall not be a charitable purose, if it involves the carrying on of any activity in the nature of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity:
Provided further that the first proviso shall not apply, if the aggregate value of the receipts from the activities referred to therein is twenty-five lakh rupees or less in the previous year;'
7. The assessee's principal object is the development of the Mumbai Metropolitan Region according to the Regional Plan. The same involves a number of interrelated activities, viz. review of plans - physical, economic and financial; projects or schemes of development (including preparation thereof); their execution, supervision, financing, as well as co-coordinating the execution amongst, and rendering advise to, different authorities engaged in formulation and undertaking such schemes in different areas, viz. agricultural, horticultural, diary, fishery, cattle breeding, etc. If this is not an economic activity, carried on in an organized manner, what we wonder it is? It is also not the case that the assessee does not charge any sum for its activities. That is, generates revenue there-from.
The expression 'business' is well known in the income-tax law, being in fact defined u/s.2(13) thereof to include trade, commerce or manufacture or any adventure or concern in relation thereto. As observed by the apex court as far back as in Narain Swadeshi Weaving Mills vs. Commissioner of Excess Profits Tax [1954] 26 ITR 765 (SC), the word 'business' connotes some real, substantial and systematic or organized course of activity or conduct with a set purpose. It goes on to explain that even a single and isolated transaction is conceivably capable of falling within the definition of business as being an adventure in the nature of trade provided the transactions bears clear indicia of trade (pg. 773). The principle/s of law being clear, the determination rests on the finding/s of fact, which is to be arrived at by taking the totality of the facts and circumstances into account. As explained, 'business' is a term of wide import, 12 MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) encompassing within it the different forms and shades of transactions, viz. trade, commerce, etc., which are again terms of considerable amplitude. The import or even the common parlance meaning of all these terms is not in dispute or in doubt. Reference in this context may be made inter alia to decisions in the case of Bengal & Assam Investors Ltd. v. CIT [1966] 59 ITR 547 (SC); Khan Bahadur Ahmed Alladin & Sons v. CIT [1968] 68 ITR 573 (SC); P.M. Mohammed Meera Khan v. CIT [1969] 73 ITR 735 (SC); Karam Chand Thapar & Bros. (P) Ltd. vs. CIT [1971] 82 ITR 899); Dalmai Cement Ltd. v. CIT [1976] 105 ITR 633 (SC), besides several by the high courts, as recently in Institute of Chartered Accountants of India (ICAI) v. Director General of IT [2012] 347 ITR 99 (Del), where the term has been elucidated by the hon'ble courts.
The language of proviso to section 2(15) extends to any activity that may be in the nature of trade, commerce or business - all terms of wide amplitude, or any activity of rendering any services in relation to the same. We, accordingly, have no hesitation in holding that the assessee's activities are covered by the proviso to section 2(15); the gross receipt for the current year exceeding the minimum threshold limit which exceeds the application of the first proviso. Ground 2 of the assessee is, thus, stand decided against it.
8. We may next proceed to decide the assessee's Ground #1, raising the issue of the legal consequence/s of the applicability of proviso to section 2(15) on the registration of an entity as a charitable institution. The arguments of both the parties stand listed in detail at paras 3.1 to 3.4 of the order dated 31.12.2013, which would continue to hold, and shall therefore form part of this order, as indeed shall the other parts of this order, save as not specifically modified or withdrawn per this order. Both the parties have, as shall be evident there-from (refer paras 3.1 & 3.4) relied on several decisions by the tribunal. No doubt, the assessee has relied on one decision by the hon'ble high court [CIT v. Sarvyodaya Ilakkiya Pannai [2012] 343 ITR 300 (Mad)], but then the said decision stands also considered by the tribunal in the case of Entertainment Society of Goa v. CIT [2013] 23 ITR (Trib) 636 (Panaji), relied upon by the Revenue, holding, with reference to decision by the hon'ble jurisdictional high court in CIT v. Thane Electricity Supply Ltd.
13MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E) [1994] 206 ITR 727 (Bom), the decision by the non-jurisdictional high court as not binding. The rule of precedence, in case of conflicting views by the high courts, none of which is jurisdictional, is for the tribunal to follow that which appeals to its conscious In our considered opinion, therefore, the appropriate course under the circumstances, even as indicated during the hearing in the instant proceedings - to no objection by either party, is that the matter be referred to the hon'ble President of the Tribunal for constituting a larger bench of the tribunal to decide the highly contentious issue raised by the assessee's Ground No.1, decided differently by different coordinate benches of this tribunal, for uniform application across the tribunal, of course after hearing the parties. The statement of the case for the purpose of the said reference, is in our view as listed per para 3 of the Tribunal's order dated 31.12.2013, delineating the respective cases of both the sides. The larger bench of the tribunal, in the case the reference made hereby is accepted by the hon'ble President, shall, apart from the other arguments and case law as may be canvassed before it by the parties, consider the same. We support our decision for the reference aforesaid, apart from the clear provision of section 255(4) of the Act, on the settled law on precedence as explained by several celebrated decisions in the higher courts of law, as for example in the case of CIT v. B.R. Constructions [1993] 202 ITR 222 (AP)(FB).
9. We are unable to understand the import of the assessee's Ground III, raised without prejudice to its Grounds I & II, in-as-much as the competent authority had withdrawn the approval u/s.12AA(3) only with effect from A.Y. 2009-10, the current year. As regards the retrospective application of the said provision, the same stands decided by the tribunal vide para 4.1 of its order dated 31.12.2013 with reference to the binding decision by the hon'ble jurisdictional high court, and qua which the assessee has not raised any objection per its MA. The same shall, therefore, obtain. No ground qua the non-adjudication of its Gd. III has been taken by the assessee either per its MA or during the course of its arguments both in the appellate as well as the rectification proceedings. We hold accordingly.
14MA No. 126/Mum/2014 & ITA No. 625/Mum/2012 (A.Y. 2009-10) Mumbai Metropolitan Region Development Authority vs. DIT(E)
10. The matter is accordingly referred to the Hon'ble President for constituting a larger bench to decide the assessee's Ground I. We decide accordingly.
11. In the result, the assessee's miscellaneous application is allowed, while the assessee's appeal is disposed of on the afore-said terms.
Order pronounced in the open court on April 10, 2015
Sd/- Sd/-
(D. Manmohan) (Sanjay Arora)
उपा य / Vice President लेखा सद य / Accountant Member
मंब
ु ई Mumbai; दनांक Dated : 10.04.2015
व. न.स./Roshani, Sr. PS
आदे श क त ल प अ े षत/Copy of the Order forwarded to :
1. अपीलाथ / The Applicant
2. यथ / The Respondent
3. आयकर आयु त(अपील) / The CIT(A)
4. आयकर आयु त / CIT - concerned
5. वभागीय त न ध, आयकर अपील य अ धकरण, मंब
ु ई / DR, ITAT, Mumbai
6. गाड फाईल / Guard File
आदे शानुसार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt. Registrar)
आयकर अपील य अ धकरण, मुंबई / ITAT, Mumbai