Income Tax Appellate Tribunal - Mumbai
Ito 19(3)(3), Mumbai vs Sea Face Park Co Operative Housing ... on 10 January, 2017
आयकर अपीलीय अिधकरण, अिधकरण, मुब ं ई "ई " खंडपीठ Income-tax Appellate Tribunal "E"Bench Mumbai सव ी राजे , लेखा सद य एवं पवन सह, याियक सद य Before S/Sh. Rajendra,Accountant Member & Pawan Singh, Judicial Member आयकर अपील सं./I.T.A./7146/Mum/2014, िनधा रण वष /Assessment Year: 2011-12 Income tax Officer-19(3)(3) M/s. Sea Face Park Co-op Hsg. Society Room No.202, 2nd Floor, Matru Mandir, Ltd., 50, Bhulabhai Desai Road Tardeo Rd. Vs. Mumbai-400 026.
Mumbai-400 007. PAN:AAAAS 3577 R
(अपीलाथ /Appellant) ( यथ / Respondent)
Revenue by: Ms. Beena Santosh -DR
Assessee by: Shri R. Murlidhar
सुनवाई क तारीख / Date of Hearing: 10.01.2017
घोषणा क तारीख / Date of Pronouncement: 10.01.2017
आयकर अिधिनयम ,1961 क धारा 254(1) के अ
तग त आदे श
Order u/s.254(1)of the Income-tax Act,1961(Act )
लेखा सद य राजे
के अनुसार PER RAJENDRA, AM-
Challenging the order dated 25/09/2014, of the CIT(A)-27, Mumbai the Assessing Officer (AO) has filed the present appeal.Assessee is a Cooperative Housing Society (CHS). It filed its return of income on 29/09/2011,declaring NIL income.The AO completed the assessment, u/s.143 (3) of the Act, on 08/10/2013, determining its income at Rs. 1.16 Crores.
2.The first ground of appeal deals with deleting the addition of Rs. 99.50 lakhs under the head premium collected from outgoing members on transfer of flat to the society building repair fund. The second ground of appeal is about deleting the addition of Rs. 13.55 lakhs received by the assessee under the head non-occupancy charges from the members.
3.During the course of hearing before us,the Representatives of both the sides agreed that identical issues had arisen in the earlier year in assessee's own case and that the Tribunal had decided the issue while adjudicating the appeal for the AY.2009-10 (ITA/5886/Mum/2013, dated 21/08/2015). We find that both the issues, raised by the AO, have been deliberated upon and have been decided by the Tribunal in its order dated 21/08/2015. We would like to reproduce the relevant portion of the said order and it reads as under:
"2. The revenue has raised the following grounds:
"1. Whether on the facts and circumstances of the case and in law, the ld.CIT(A) has erred in allowing the exemption to tax the common amenities funds and non-occupancy charges receives by assessee co-op. housing society under the principle of mutuality without appreciating the fact that the reliance placed on decision of High Court of Bombay in case of M/s.Mittal Court 7146/M/14-M/s. Sea Face Premises Co-op,Hsg.Society Ltd. vs. ITO (320 ITR 414) has not been accepted by Revenue and SLP has been filed before Hon'ble Supreme Court of India against the same.
2. The appellant craves leave to amend or alter any round or add a new ground which may be necessary?"
3. At the time of hearing, nobody appeared on behalf of the assessee-respondent despite notice by RPAD. However, since an identical issue has been considered by us in another appeal bearing ITA No.5888/Mum/2013 in the case of M/s.Shyam CHS Ltd. we propose to dispose of this appeal of the revenue ex-parte.
4. We have heard the learned DR and also considered the relevant material on record. At the outset, we note that an identical issue has been considered by us in the case of M/s.Shyam CHS Ltd. in ITA No.5888/Mum/2013. The relevant part of the even dated order is as under:
6. Having considered the rival submissions and careful perusal of the record, at the outset we note that an identical issue has been considered and decided by this Tribunal in assessee's own case for assessment year 2007-08 as well as for assessment year 2008-09. For the earlier assessment year i.e. 1999-2000 to 2001-02, the matter was carried to the Hon'ble jurisdictional High Court and the Hon'ble jurisdictional High Court vide order dated 17/7/2009 in ITA Nos.92, 93 & 206 of 2003 has decided the question as under:
"Whether on the facts and in the circumstances of the case any part of transfer fees received by the assessee societies - whether from outgoing or incoming members - is not liable to tax on the ground of mutuality?"
Thus, it is clear that the issue of transfer fee received from outgoing or incoming persons was considered and decided in favour of the assessee by holding that the principle of mutuality is applicable on such receipt/contribution by the outgoing and incoming persons and accordingly the same is not taxable. For the assessment year 2003-04 again, this issue was considered by the Hon'ble jurisdictional High Court in Income-tax Appeal No.85 of 2013 wherein the question of law in revenue's appeal was same and decided as under:
"Whether on the facts and in the circumstances of the case and in law, the Tribunal, was justified in upholding the CIT(A)'s order and dismissing the revenue's appeal and accepting the assessee's plea that the contribution of Rs.42 lakhs paid towards the transfer fees and principleRs.23,250/- being non occupancy charges are covered by the principle of mutuality and is not chargeable to tax?"
............................
7. We find that so far as non occupancy charges are concerned the same has not been admitted by this Court in M/s Panchratna Co Housing Society Ltd. (supra). No order has been shown to the issue on non-occupancy charges. However there are two appeals admitted on the issue of transfer fees on 14th June 2012 and 18th February 2013 as relied by the revenue. The very grievance raised by the r e v e n u e i n t h i s a p p e a l i n r e s p e c t o f w a s r a i s e d b y t h e revenue in respect o f trans fer fees was raised by the revenue be fore this Court in Darbhanga Mansion Co-op . Housing Socie ty Ltd. (supra). This Court by order dated 18th December 2013 did not accept an identical grievance by observing thus:
"While it may be true that it is occasioned by transfer of a flat and garage , ye t , we do not see how merely because there was cap or re s t ri c tion pla ced on the t ran s f e r f e e s or the quantum thereof, in this case the principle of mutuality cannot be applied. The underlying principle and of a co-operative movement has been completely overlooked by the Counsel for the Revenue. The Revenue seems to be of the view that a C o - o p e r a t i 2 7146/M/14-M/s. Sea Face veHousingSocietymakesprofit,ifitreceivessomethingbeyond t h i s a m o u n t o f Rs.25,000/-. There has to be material brought and which will have a definite bearing on this issue. If the amount is received on account of transfer of a flat and which is not restricted to Rs.25,000/- but much more, then different c o n s i d e r a t i o n m a y a p p l y . H o w e v e r , i n t h e p r e s e n t c a s e , what has been argued and vehemently is the amount was received by the Society when the flat and the garage were transferred. Therefore, it must be presumed to be nothing but transfer fees. It may have been credited to the fund and with a view to d em o n s t r a te that it is nothing but a voluntarily contribution or donation to the Society, but still it constitutes its income. However, for rendering such a conclusive finding there has to be material brought by the Revenue on record. Beyond urging that it has been received at the time of a transfer of the flat and credited to such fund will not be enough to displace the principle laid down in the decision of Sind Co-operative Housing Society. The attempt of the Revenue therefore is nothing but overcoming the binding judgment of this Court. In the present case, the Commissioner and the Tribunal both have held that the receipt may have been occasioned by the transfer but the principle of mutuality will still apply..................... In the present case, there fore, the Tribunal following its earlier views and applying the ratio o f this judgment, di smissed the R e venue' s appeal and confirmed the Commissioner's finding. The concurrent findings, therefore, in this case are in consonance with the factual materials brought on record. There is substance in the argument of Mr.Irani that the Assessing Officer be fore him the material in the form of the bye-laws o f the S o c i e t y . T h e bye-laws also are in consonance with the Government Resolution and stipulate a sum of Rs.25,000/- towards transfer fees. The Assessee in this case is presumed to have received nothing but transfer fees and it is that underlying presumption which has prevailed upon the Assessing Officer to take a particular view.
12. We find that the Assessing Officer has been therefore, rightly corrected by the Commissioner. Without any material, cogent and satisfactory, being produced, the sum and in its entirety as credited could not be assumed to be t r an s f e r f e e s . The receipt thereof may have be en occasioned by the transfer of the flat and garage."
8. In this case also, nothing has been brought on record to indicate that the respondent had received more amounts than allowed/permitted in the State Government Circular dated 9th August 2001. Further in the respondent-assessee's own case, this Court has decided the issue in its favour and in the absence of any distinguishing feature, the Tribunal was obliged to follow the same. This is precisely what the impugned order has done. Thus, as the issue is covered in favour of the respondent-assessee by order of this Court dated 17th July 2009(Income Tax Appeal No .92 ,93 and 208/2008) no substantia1 question o f law arises in this case ."
Thus it is clear that the issue raised by the revenue in the present appeal is squarely covered by the judgment of the Hon'ble jurisdictional High Court in the assessee's own case. Though the revenue has contended that it has not accepted the judgment of the Hon'ble jurisdictional High Court and filed a SLP before the Hon'ble Supreme Court, however, in the absence of any stay or revision of the decision of the Hon'ble jurisdictional High Court, it is a binding precedent for this Tribunal. Respectfully following the judgment of the Hon'ble jurisdictional High Court, we do not find any error or illegality in the impugned order of the CIT(A).
In view of the above, we do not find any error or illegality in the order of the CIT(A) and is therefore upheld.
5. In the result, the appeal of the revenue is dismissed."
37146/M/14-M/s. Sea Face Respectfully following the above order of the Tribunal for the AY. 2009-10, we decide both the grounds against the AO and confirmed the order of the First Appellate Authority (FAA).
As a result, appeal filed by the AO stands dismissed.
फलतः िनधा रती अिधकारी ारा दािखल क गई अपील नामंजूर क जाती है.
Order pronounced in the open court on 10th January, 2017. आदेश क घोषणा खुले यायालय म दनांक 10 जनवरी, 2017 को क गई ।
Sd/- Sd/-
( पवन सह /Pawan Singh) (राजे / RAJENDRA)
याियक सद य / JUDICIAL MEMBER लेखा सद य / ACCOUNTANT MEMBER
मुंबई Mumbai; दनांकDated : 10.01.2017.
Jv.Sr.PS.
आदेश क ितिलिप अ ेिषत/Copy of the Order forwarded to :
1.Appellant /अपीलाथ 2. Respondent /
यथ
3.The concerned CIT(A)/संब अपीलीय आयकर आयु , 4.The concerned CIT /संब आयकर आयु
5.DR "G " Bench, ITAT, Mumbai /िवभागीय ितिनिध, खंडपीठ,आ.अिध.मुंबई
6.Guard File/गाड फाईल स यािपत ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुंबई /ITAT, Mumbai.
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