Income Tax Appellate Tribunal - Delhi
Association Of Management Studies,, ... vs Department Of Income Tax
1 ITA No.4215/Del/2012
Asstt.Year: 2009-10
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH `A' NEW DELHI
BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT
AND
SHRI CHANDRA MOHAN GARG, JUDICIAL MEMBER
I.T.A.No.4215/Del/2012
Assessment Year : 2009-10
Asstt. Commissioner of Income Tax, vs Association of Management
Range-I, Meerut. Studies, 175, Saket, Meerut.
(PAN: AAATA7059B)
(Appellant) (Respondent)
Appellant by: Shri Bhim Singh, Sr. DR
Respondent by : Shri S. Krishnan
ORDER
PER CHANDRA MOHAN GARG, JUDICIAL MEMBER
The above appeal has been filed by the revenue against the order of CIT(A), Meerut dated 05.05.2012 in Appeal No. 362/11-12 for AY 2009-10.
2. The grounds raised by the revenue in this appeal read as under:-
"1. Whether in the facts and circumstance of the case, the Ld. CIT(Appeals) has erred in la, directing to compute the income at NIL ignoring that the assessment was made at returned income i.e. Rs. 1,85,50,256/- as claim, u/s 11 of LT. Act, 1961 not made in return, could not be allowed by AO without filing of revised return by the assessee. Reliance is placed on the judicial pronouncement the case of Goetz (India) Ltd. 284 ITR 323 (SC).
2. Whether in the facts and circumstance of the case, the Ld. CIT(Appeals) has erred in law in directing to compute the income at NIL and allowing the claim of assessee u/s 11 of the I.T. Act, 1961 ignoring that he was 2 ITA No.4215/Del/2012 Asstt.Year: 2009-10 also not empowered to accept such claim as his powers are coterminous those of A.D. and he can not do what the A.D. could not have done. Reliance is placed on Elel Hotels & Investment Ltd. Vs CIT [2005] 2 SOT 659 (Mum.)
3. That the appellant craves leave to add, modify and/or delete any ground(s) of appeal.
4. In the facts and circumstances of the case, the order of the Commissioner of Income (Appeals) may be set aside and that of the A.D. restored."
3. Briefly stated the facts giving rise to this appeal are that the case was selected for scrutiny under CBDT Instructions and statutory notices u/s 143(2) and 142(1) of the Income Tax Act, 1961 (for short the Act) along with questionnaire were served on the assessee. The Assessing Officer noted that the assessee was running a number of higher technical education institutions at Meerut and Greater Noida which were engaged in the process of imparting higher professional education in the field of engineering, law, management, hotel management, pharmacy and medical sciences etc. The Assessing Officer also observed that the assessee society has been granted registration u/s 12A of the Act and was eligible for exemption u/s 11 of the Act. The Assessing Officer finally held that the total application of income during the year under consideration was more than 85% of the total receipts. Hence exemption u/s 11 was allowed to the assessee. But at the end of 3 ITA No.4215/Del/2012 Asstt.Year: 2009-10 assessment completed u/s 143(3) of the Act, the Assessing Officer finalized the assessment on returned income of Rs.1,85,50,256/-.
4. Being aggrieved by the above assessment order, the assessee filed an appeal before the Commissioner of Income Tax(A), Meerut which was allowed by the impugned order. The Commissioner of Income Tax(A) allowed the appeal of the assessee with a finding that when the assessee was entitled to exemption u/s 11 of the Act, then the income could be computed only at nil and the Assessing Officer herself has observed that the society has been granted registration u/s 12A of the Act and was eligible for exemption u/s 11 of the Act and Assessing Officer also found that the assessee society has applied more than 85% of its total receipts for the object and purposes of the society. Therefore, Commissioner of Income Tax(A) held that income ought to have been computed at nil and the Commissioner of Income Tax(A) deleted the addition and directed the Assessing Officer to finalize the assessment at nil income. Now, the revenue is before this Tribunal with the second appeal on the ground as mentioned hereinabove.
5. Ground no.3 and 4 of the revenue are general in nature, which need no adjudication and we dismiss the same.
6. Apropos ground no. 1 and 2, we observe that the Assessing Officer has observed that the assessee society has been granted registration u/s 12A 4 ITA No.4215/Del/2012 Asstt.Year: 2009-10 of the Act by the competent authority and, therefore, the assessee society was eligible for exemption u/s 11 of the Act. The Assessing Officer also brought out the fact that the assessee society has applied more than 85% of its total receipts and the Assessing Officer also allowed exemption u/s 11 of the Act. In the last sentence of the assessment order, the Assessing Officer held that the assessment was completed u/s 143(3) of the Act on returned income of Rs.1,85,50,256/-.
7. Ld. DR placed reliance on the judgment of Hon'ble Supreme Court in the case of Goetz (India) Ltd. 284 ITR 323 (SC) and another decision of ITAT Mumbai in the case of Elel Hotels & Investment Ltd. Vs CIT [2005] 2 SOT 659 (Mum.). On careful perusal of above citations, we observe that reliance on Goetz (India) Ltd. (supra) is misconceived because the ratio of this judgment is that the Assessing Officer is bound to the claims made in a return by the assessee and it is not applicable to the appellate authority. As per judgement of ITAT Mumbai in the case of Elel Hotels & Investment Ltd. Vs CIT (supra), the only ratio is supporting the proposition that the Commissioner of Income Tax(A)'s powers are co-terminus with those of the Assessing Officer. Therefore, the Commissioner of Income Tax(A) in his appellate jurisdiction can do what the Assessing Officer could have done but omitted to do, but the Commissioner of Income Tax(A) 5 ITA No.4215/Del/2012 Asstt.Year: 2009-10 cannot do what the Assessing Officer could not have done. From bare reading of this judgment, we observe that this is a general and well-accepted proposition affirmed by various High Courts and Hon'ble Supreme Court and in the present case when the Assessing Officer has observed that the assessee society has been granted registration u/s 12A of the Act and when the assessee society has applied more than 85% of its total receipts for the objects and charitable purposes of the society, then certainly the assessee society was entitled for exemption u/s 11 of the Act. From the assessment order, we observe that despite above facts, the Assessing Officer finalized the assessment and the returned income by the assssee which ought to have been assessed at nil because the Assessing Officer herself held that the assessee was entitled for exemption u/s 11 of the Act. Accordingly, the Commissioner of Income Tax(A) granted exemption u/s 11 of the Act to the assessee society which the Assessing Officer could have granted but omitted to do so.
8. From the impugned order, we observe that the Commissioner of Income Tax(A) did not allow any new exemption or deduction to the assessee but the Commissioner of Income Tax(A) simply corrected the assessment order with an observation that the assessee society was exempted u/s 11 of the Act, therefore the assessment was to be made at nil income and 6 ITA No.4215/Del/2012 Asstt.Year: 2009-10 the Commissioner of Income Tax(A) directed the Assessing Officer to finalize the assessment accordingly. We are unable to see any infirmity, ambiguity or any other valid reason to interfere with the impugned order. Accordingly, ground no. 1 and 2 of the Revenue being devoid of merits are dismissed.
9. In the result, the appeal of the revenue is dismissed.
Order pronounced in the open court on 12.4.2013.
Sd/- Sd/-
(G.D. AGRAWAL) (CHANDRAMOHAN GARG)
VICE PRESIDENT JUDICIAL MEMBER
DT. 12th APRIL 2013
'GS'
Copy forwarded to:-
1. Appellant
2. Respondent
3. C.I.T.(A)
4. C.I.T.
5. DR
By Order
Asstt.Registrar