Income Tax Appellate Tribunal - Chandigarh
M/S Patiala Urban Planning And ... vs Ito, Patiala on 13 November, 2017
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IN THE INCOME TAX APPELLATE TRIBUNAL
CHANDIGARH BENCHES, 'B' CHANDIGARH
BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER &
MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER
M.A. No. 73/Chd/2016
(in ITA No. 674/Chd/2014)
(Assessment Year: 2007-08)
M/s Patiala Urban Planning & Vs. The ITO, Ward-2,
Development Authority, Patiala
Patiala.
PAN No. AAALP0095J
M.A. No. 74/Chd/2016
(in ITA No. 675/Chd/2014)
(Assessment Year: 2008-09)
M/s Patiala Urban Planning & Vs. The ITO, Ward-2,
Development Authority, Patiala
Patiala.
PAN No. AAALP0095J
M.A. No. 75/Chd/2016
(in ITA No. 839/Chd/2014)
(Assessment Year: 2010-11)
M/s Patiala Urban Planning & Vs. The ITO, Ward-2,
Development Authority, Patiala
Patiala.
PAN No. AAALP0095J
&
M.A. No. 76/Chd/2016
(in ITA No. 840/Chd/2014)
(Assessment Year: 2011-12)
M/s Patiala Urban Planning & Vs. The ITO, Ward-2,
Development Authority, Patiala
Patiala.
PAN No. AAALP0095J
(Appellant) (Respondent)
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Appellant By : Sh. Tej Mohan Singh
Respondent By : Sh. K.S. Bains
Date of hearing : 27.10.2017
Date of Pronouncement : 13.11.2017
ORDER
Per Sanjay Garg, Judicial Member:
The captioned Misc. Applications with identical pleadings made therein have been moved by the assessee stating therein that a mistake apparent on record has crept in the common order dated 6.5.2015 of this Tribunal passed in ITA Nos. 674 & 675/Chd/2014 and ITA Nos. 839 & 840/Chd/2014 dismissing the aforesaid appeals.
2. Para Nos. 1 to 3 of the applications are a matter of record. In Para 4 of the application, it has been pleaded that though an adjournment application was moved by the assessee on the ground that the appeal u/s 12AA of the Act was fixed on 25.5.2015, however, the said application of the assessee was rejected by the Tribunal and the matter was heard on merits on 30.04.2015. It has been pleaded that the appeal was decided on merits on the basis of material on record without any arguments having been advanced by the counsel for the assessee In paras 5 & 6 of the application, the relevant part i.e. paras 18 to 21 of the order of the Tribunal has been reproduced. In para 7 of the Application, it has been pleaded that Tribunal has recorded a wrong finding that no amount was spent by the assessee on charitable purposes; that the Bench had failed to consider that there was a valid registration u/s 12 A of the Act was subsisting in favour of the assesse and that the assessing officer could not 3 have disregarded the same. That the Tribunal has also failed to take notice that the assessee had specifically informed the AO that Form 10 has been filed by the assessee with the return as per the provisions of section 11(2) of the Act. It has been further pleaded in the subsequent paras of the application that the Assessing officer in his order relied on the decision of the Hon'ble Uttrakhad High Court which has been overruled by the Hon'ble Supreme Court and yet the Tribunal has concluded, "the authorities below have correctly analyzed the facts and material on record before giving adverse findings against the assessee denying exemption under Section11 of the I.T. Act", which is a mistake apparent on record. It has been further pleaded that the authorities below had relied upon the decision of the High Court in the case of 'Queens Educational Society', which stood reversed by the Supreme Court, but the Tribunal failed to take note of the decision of the Supreme Court reported in 372 ITR 699 (SC). Further, a subsequent event has been pleaded that the registration u/s 12AA, which was cancelled by the lower authorities, has been restored by the Tribunal vide order dt 4.12.2015. It has, therefore, been pleaded that in view of the aforesaid factual and legal aspects, grave injustice has been caused to the assessee and therefore recalling of the order dated 6.5.2011 has been prayed for.
3. We have heard the contentions and have also gone through the record.
4. We have gone through the impugned order. We find that the Tribunal (presided over by our predecessor Members) in paras 2 & 3 has thoroughly discussed that despite giving sufficient opportunities, the counsel for the assessee had neither filed paper book nor written 4 submissions but consistently sought adjournments. Ultimately, last opportunity was also granted. However, again adjournments applications had been moved. In the last adjournment application, moved on 30.04.2015, it was requested that the appeal u/s 12AA of the Act was fixed on 25.5.2015, therefore, the captioned appeals should be adjourned. The Bench found the request improper as the appeals under consideration had no connection with the appeals fixed for 25.5.2015. The Ld. Counsel for the assessee was given opportunity to argue the appeals but he did not argue the same. Hence, the appeals were decided after hearing the Ld. DRs and pursuing the material on record.
5. Paras 2 & 3 of the order dated 6.5.2015 of this Tribunal, for the purpose of ready reference is reproduced as under:-
"2. It may be no ted here that during the hearing of appe als, ld. counsel f or the assessee did no t argue all the appe als. The record revealed that two appe als f or assess men t ye ars 2007-08 and 2008-09 were f iled in July, 2014 and these were taken up f or hearing on 30.09.2014. On 30.09.2014, ld. counsel f or the assess ee sought adjournment on the ground that in these cases, Paper Book and writte n submiss ions are required to be f iled, theref ore, on his reques t, appe als were adjourned to 20.01.2015. On 20.01.2015, again ld. counsel f or the assessee made a similar reques t f or adjournmen t on the s imilar ground that Paper Book and wr itte n submiss io ns are required to be f iled. The appe als were adjourned to 09.04.2015. The appe als were take n up f or hearing on 09.04.2015 and ag ain a reque s t was made f or adjournmen t on the ground that arguing counsel has gone abro ad f or a short v is it. On his reque s t, the appeals were adjourned to 30.04.2015 and it was direc te d that it would be las t o pportunity to the assessee.5
3. The remaining two appe als f or assess ment ye ars 2010-11 and 2011-12 were also later on taken up toge ther f or the purpose of hearing, be ing the issues co mmon. On 30.04.2014 the ld. counsel f or the assessee ins te ad of arguing the appe als on merits, ag ain made a reques t f or adjournmen t on the ground that the appe al under section 12AA of the Ac t is f ixed on 25.05.2015, theref ore, these appeals may be adjo urned. The request of assessee was f ound improper as it has no connectio n with such appe al. The assessee, till date has no t f ile d any Paper Book or writte n submiss io ns on which e arlie r adjournmen ts were sought. The reques t f or adjo urnmen t was according ly re jected. The ld. counsel f or the assessee was g iv en opportunity to argue the appe als, ho wever he has no t argued any of the appe als. Theref ore, we proceed to decide all the appe als on merits on the bas is of the mate rial av ailable on record."
6. The Ld counsel for the applicant could not bring out as to which of the fact recoded above in paras 2 & 3 of the impugned order was wrong or not as per record. We, therefore, do not find any mistake apparent on record in this respect. Merely because the application for adjournment has bene rejected for the justifiable reasons, as reproduced above, that itself, does not constitute any mistake calling for any rectification.
7. So far as the contention that the assessee was having a valid registration u/s 12A of the Act and that the said fact has been ignored by the Assessing officer and that the Bench has also failed to take note of the fact the assessee had furnished Form 10 to the Assessing officer is concerned, we find that the effect of registration u/s 12AA has been thoroughly discussed by the Tribunal in para 21 of the Order, wherein it has been observed that there is no quarrel about the legal position that even if registration is existing u/s 12AA in favour of the assessee, still Assessing officer is empowered to examine the applicability of provisions 6 of sections 11 to 13 of the Act at the assessment stage to see whether income is applied by the assessee for charitable purpose to achieve its aims and objects. The Tribunal in the impugned order has discussed the factual aspects of the case and held that the authorities below have correctly analysed the facts and material on record. The Tribunal after analyzing the facts has given the factual findings that the assessee had not spent the amount on charitable activities, rather the assessee was involved in commercial activities. The relevant para 21 of the order dated 6.5.2015, for the purpose of ready reference, is reproduced as under:-
"21. We do no t f ind any quarre l with the leg al propos ition argued by the ld. DR because even if regis tration is ex is ting under section 12AA in f avour of the assessee, s till Assess ing Of f icer is e mpo wered to examine the applicability of provis ions of Sectio n 11 to 13 at the assess men t s tage to see whe ther inco me is applied by the assessee f or charitable purpose to achieve its aims and objects. In the present case, the Assess ing Of f icer on the bas is of the f inding g iven in subsequent assess men t ye ar 2009-10 and examining the record of th is assess ment year f ound that assessee has been carrying on bus ine ss of sale of plo ts and e arned huge prof its as well as entered into agree ment with M/s Omaxe Ltd. and earned 15% of the prof it f rom such activ ity. No amo unt is spen t on charitable pur poses. Theref ore, Assess ing Off icer rig htly f ound that assessee's activ ity does not f all within the me aning of "The adv ance men t of any o ther obje ct of general public util ity under sectio n 2(15) of the Inco me Tax Ac t". The ld. CIT(Appe als) also no ted in the impugned order that f acts of the case of the assessee are iden tical to that of PUDA as was conte nded by the as sessee bef ore him. The ld. CIT( Appe als) was theref ore, jus tif ied in f ollo wing the decis ion of ITAT Chandig arh Bench in the case of PUDA (supra). It was also f ound that when inco me of M/s Omaxe Ltd. was tax able which earned 85% of the 7 inco me, then ho w the inco me of the as sessee at 15% f rom the same Jo int Agree ment with M/s Omaxe Ltd. would be exe mpt and ho w the assessee could claim exe mption of inco me under section 11 of the Ac t. The au thorities belo w have correctl y analyzed the f acts and material on record bef ore giv ing adverse f inding agains t the assessee denying exemption u/s 11 of IT Act. The assessee has no t been able to rebut the f inding of f acts recorded by the authorities be lo w and in the abse nce of any material on record in f avour of the assessee, we do no t f ind any jus tif ication to inte rf ere with the orders of the au thorities belo w. Ground of appe al Nos. 2 & 3 of the appe al of the assessee are, according ly dis missed."
8. We find from the impugned order that it is not a case where any proposition of law which has been reversed by the Supreme Court has been applied or any proposition of law laid down by the Hon'ble Supreme Court has been ignored, though cited before the Tribunal. The earlier counsel of the assessee had himself chosen not to argue the case before the Tribunal and now at this stage by citing certain case laws in the rectification application and stating that a mistake has occurred in the order of the Tribunal, cannot be held to be justifiable. Moreover, as observed above, the appeals of the assessee have been decided on factual aspects and not on the basis of any legal proposition by the Tribunal. The counsel for the assessee has been specifically asked to show which of the case law cited by the assessee has not been taken note of and which of the case laws have been wrongly applied by the Tribunal in the impugned order but he could not show or demonstrate any such aspect in the impugned order of the Tribunal. The Tribunal, as the facts were available before it, has given a factual findings. With due respect to all the case laws relied upon by the counsel for the assessee, we find no mistake apparent on record in this 8 case. So far as reliance of the Ld. counsel on the subsequent decision of the Tribunal is concerned, in our view, any finding arrived by a Coordinate Bench of the Tribunal in a subsequent decision, cannot be held to be a reason enough to hold that there was any mistake in the earlier order of the Tribunal. Moreover, we deem it fit to mention further here that this Tribunal has no power to review. If the assessee has any grievance against the impugned order, proper course is to agitate the same before the next appellate authority. The Hon'ble Bombay High Court in the case of 'Commissioner Of Income-Tax vs Ramesh Electric And Trading Co.' 1993 203 ITR 497 (Bom.), while relying upon the decision of the Hon'ble Supreme Court in the case of 'T. S. Balaram, ITO v. Volkart Brothers' [1971] 82 ITR 50 and further relying upon the decisions of the various High Courts has categorically held that the power of rectification under section 254(2) of the Income-tax Act can be exercised only when the mistake which is sought to be rectified is an obvious and patent; mistake which is apparent from the record, and not a mistake which requires to be established by arguments and a long drawn process of reasoning on points on which there may conceivably be two opinions. Failure by the Tribunal to consider an argument advanced by either party for arriving at a conclusion is not an error apparent on the record, although it may be an error of judgment and under such circumstances the Tribunal has no jurisdiction under section 254(2) to pass the second order.
9. In view of our above observations and the legal position as stated above, we do not find any merit in this application and the same is accordingly hereby dismissed.
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10. In view of the above, all the captioned Misc. applications are hereby dismissed.
Order pronounced in the Open Court on 13.11.2017 Sd/- Sd/-
(ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 13.11.2017 Rkk Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR