Income Tax Appellate Tribunal - Pune
D.Y. Patil Pratishtan,, Kolhapur vs Department Of Income Tax on 27 September, 2013
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE BENCHES "B", PUNE
BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER
AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER
ITA No.1747/PN/2012
(Assessment Year : 2009-10)
Dy. Commissioner of Income Tax,
(Central) Circle, Kolhapur .... Appellant
Vs.
Dr. D. Y. Patil Pratishtan,
2126/E, Tarabai Park,
Kolhapur
PAN : AAATD5311R .... Respondent
Department by : Mr. A. K. Modi
Assessee by : Mr. Nikhil Pathak
Date of hearing : 27-09-2013
Date of pronouncement : 30-09-2013
ORDER
PER G. S. PANNU, AM
The captioned appeal has been preferred by the Revenue which is directed against the order of the Commissioner of Income Tax (Appeals), Kolhapur dated 29.06.2012 which, in turn, has arisen from an order dated 29.12.2011 passed by the Assessing Officer, under Section 143(3) of the Income-tax Act, 1961 (in short "the Act"), pertaining to the assessment year 2009-10.
2. In this appeal, the Revenue has raised following main issues :-
"1. Whether on the facts & in the circumstances of the case and in law the Ld. CIT(A) was justified in allowing exemption u/s.11 of the I.T. Act to the assessee ignoring the fact that activities of the assessee are not genuine and are not being carried out in accordance with the objects of the trust.
2. Whether on the facts & in the circumstances of the case and in law the Ld. CIT(A) was justified in allowing exemption u/s.11 wherein registration u/s.12A was cancelled by the CIT. Further ITAT's order restoring the registration u/s.12A is challenged by the Revenue before the Hon'ble Bombay High Court.2 ITA No.1747/PN/2012
A.Y. 2009-10 3 .Whether on the facts & in the circumstances of the case and in law the Ld. CIT(A) was justified in allowing remuneration paid to relatives of Trustees to the tune of Rs.69,11,783/- holding that nothing has been brought on record to show that market value of the services/jobs was less than the payments made to them when the payments were squarely u/s.40A(2)(b) and constituted violation in terms of section 13(1)(c).
(ii) Without prejudice to the above, Ld. CIT(A) has erred in not exercising his plenary powers which are conterminous with that of Assessing Officer as per the ratio laid down by CIT vs. Kanpur Coal Syndicate (1964) 53 ITR 225, 229 (SC)."
3. In brief, the facts are that the respondent-assessee is a Trust which is engaged in the activity of running educational institutions. Originally it was granted registration under Section 12A of the Act by the Commissioner on 15.11.1991 but vide order dated 30.11.2007 the Commissioner invoked his power under Section 12AA(3) of the Act and cancelled such registration. In view of the aforesaid, the Assessing Officer denied the benefit of exemption of Sections 11/12 of the Act and also noted that assessee had violated the provisions of Section 13 (1)(c) of the Act also. As a result, the Assessing Officer determined the total income of Rs.15,53,30,650/- for the assessment year 2009-10 as against a returned loss of Rs.23,42,30,902/-. Assessee carried the matter in appeal before the CIT(A). In appeal, the CIT(A) noted that the issue of denial of exemption under Sections 11/12 was a subject matter of appeal in the assessee's own case for assessment years 2007-08 and 2008-09, wherein the then CIT(A) had upheld the assessee's claim of exemption under Section 11/12 of the Act. Following the precedents, the CIT(A) allowed the claim of the assessee. Against the aforesaid decision of the CIT(A), Revenue is in appeal before us by way of Grounds of Appeal Nos. 1 and 2, stated above.
4. Before us, it was a common ground between the parties that in so far as the cancellation of a registration under Section 12AA of Act by the Commissioner is concerned the same has been restored by the Tribunal on an appeal by the assessee vide ITA No.182/PN/2008 dated 28.11.2008. It was 3 ITA No.1747/PN/2012 A.Y. 2009-10 also a common ground between the parties that similar dispute in the assessee's own case has been adjudicated by the Tribunal for assessment years 2007-08 and 2008-09 vide ITA No.253/PN/2012 and ITA No.1372/PN/2012 dated 25.06.2013 and 11.09.2013 respectively. It is also notable that in the assessment year 2006-07 also the Tribunal in assessee's own case vide ITA No.1592/PN/2011 dated 14.12.2012 has held that the assessee is entitled to the benefits of Section 11/12 of the Act and that there was no violation of the provisions of Section 13(1)(c) or 13(1)(d) of the Act. In view of the aforesaid precedents, which have not been altered by any higher authority, in our view, the aforesaid Grounds raised by the Revenue deserve to be dismissed. Merely because the Revenue has not accepted the decision of the Tribunal and has filed an appeal before the Hon'ble High Court in an earlier year, cannot be a ground to take a different view in the absence of any adverse order contrary to that of the Tribunal having been passed by the Hon'ble High Court. In view of the aforesaid precedents, Grounds of Appeal Nos. 1 and 2 are dismissed.
5. By way of the Ground of Appeal No. 3, the issue is with regard to a disallowance of Rs.69,14,783/- being payments made to persons specified under Section 40A(2)(b) of the Act on the ground that same are in violation of the provisions of Section 13(1)(c) of the Act. The disallowance made by the Assessing Officer has been deleted by the CIT(A) following his own decision in the assessee's own case for the earlier assessment year of 2008-09 on a similar issue.
6. Before us, it has been pointed out that the Tribunal in the assessee's own case for assessment year 2008-09 vide ITA No. 1372/PN/2012 (supra) has upheld the stand of the CIT(A) deleting the addition, after considering the order of the Tribunal in the assessee's own case for the assessment year 2007-08 vide ITA No.253/PN/2012 (supra). The aforesaid precedents continue 4 ITA No.1747/PN/2012 A.Y. 2009-10 to hold the field and have not been altered by any higher authority and therefore we affirm the order of the CIT(A) deleting the impugned addition, as the issue involved is similar.
7. In the result, the Ground of Appeal Nos. 1, 2 and 3 raised by the Revenue are accordingly dismissed.
8. Resultantly, appeal of the Revenue is dismissed.
Order pronounced in the open Court on 30 th September, 2013.
Sd/- Sd/-
(R.S. PADVEKAR) (G.S. PANNU)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Pune, Dated: 30 th September, 2013
Sujeet
Copy of the order is forwarded to: -
1) The Assessee;
2) The Department;
3) The CIT(A), Kolhapur;
4) The CIT, Kolhapur;
5) The DR, "B" Bench, I.T.A.T., Pune;
6) Guard File.
By Order
//True Copy//
Sr. Private Secretary
I.T.A.T., Pune