COMMISSIONER OF INCOME TAX, SEC-14, HISAR vs. MARKET COMMITTEE RATIA

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ITA/181/2011HC Punjab & HaryanaPHHC01095500201112 July 2011Author: MR. JUSTICE ADARSH KUMAR GOEL,MR. JUSTICE AJAY KUMAR MITTAL2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court noted that the revenue's counsel fairly stated that the issue concerning question (1) was covered against the revenue by a previous judgment of the same Court dated 5.7.2010 in I.T.A. No.151 of 2010 (CIT v. Market Committee, Narwana). Similarly, the issue concerning question (2) was covered against the revenue by another judgment of the Court dated 28.1.2011 in I.T.A. No.823 of 2010 (Commissioner of Income Tax, Hisar v. Market Committee, Sohana). Based on these precedents, the High Court found no merit in the revenue's appeal.

What were the facts?

The Revenue, represented by the Commissioner of Income Tax, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal (ITAT), Delhi Bench. The appeal pertains to the assessment year 2007-08 and challenges the ITAT's decision regarding the allowability of an expenditure of Rs. 96,03,292/- claimed by the assessee, Market Committee, Ratia, as a contribution to the HSAM Board under statutory obligation. The Revenue also questioned whether this contribution qualified as an application of income for charitable purposes under Section 2(15) of the Act and if the assessee had fulfilled the mandatory requirements of Section 11(2) by properly specifying the purposes of accumulation in Form No. 10.

What were the issues?

1. Whether, on the facts and in the circumstances of the case, the ITAT was justified in holding that the expenditure of Rs. 96,03,292/- contributed to the HSAM Board under statutory obligation (Section 27 of the Punjab Agricultural Produce Market Act, 1961) is allowable, without appreciating that no evidence was produced to prove the actual incurring of such expenditure, and whether such contribution falls within the ambit of application of income for charitable purposes as defined in Section 2(15) of the Income-tax Act? 2. Whether, on the facts and circumstances of the case, the ITAT was justified in holding that the assessee fulfilled the mandatory requirements of Section 11(2) without specifically mentioning the definite purpose or purposes of accumulation in Form No. 10? Assessee's contentions are not recorded in the judgment. Revenue's contentions, as implied by the questions of law, are that the expenditure was not proven to be incurred, it did not qualify as application for charitable purposes under Section 2(15), and the requirements of Section 11(2) regarding specifying purposes of accumulation in Form No. 10 were not met.

Which sections of the Income-tax Act were involved?

Section 260A,Section 2(15),Section 11(2)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.

Date of decision: 12.7.2011 Commissioner of Income Tax -----Appellant Vs. Market Committee, Ratia -----Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOEL ACTING CHIEF JUSTICE HON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:- Mr. Yogesh Putney, Sr. Standing counsel for the Revenue. --- ADARSH KUMAR GOEL, ACJ This appeal has been preferred by the revenue under Section 260A of the Income Tax Act, 1961 (for short, “the Act”) against the order of Income Tax Appellate Tribunal, Delhi Bench “E”, New Delhi dated 25.6.2010 in I.T.A. No.1744/DEL/2010 for the assessment year 2007-08 proposing following questions of law:- “1. Whether on the facts and in the circumstances of the case, the Hon’ble ITAT was justified in holding that the expenditure of Rs.96,03,292/- claimed to have been contributed to HSAM Board under statutory obligation by virtue of Section 27 of the Punjab Agricultural Produce Market Act, 1961 is allowable without appreciating that no evidence could be produced by the assessee to prove that such expenditure was actually incurred and whether such contribution can be treated to fall within the ambit of application of income for charitable purposes as defined in section 2(15) of the Income-tax Act?

2.

Whether on the facts and circumstances of the case, the learned ITAT was justified in holding that the assessee has fulfilled the mandatory requirements of Section 11(2) without specifically mentioning the definite propose or purposes of accumulation in Form No.10?”

Learned counsel for the appellant fairly states that as far as question (1) is concerned, the same is covered against the revenue by judgment of this Court dated 5.7.2010 in I.T.A. No.151 of 2010 in CIT v. Market Committee, Narwana and as far as questions (2) is concerned, the same is covered against the revenue by judgment of this Court dated 28.1.2011 in I.T.A. No.823 of 2010 Commissioner of Income Tax, Hisar v. Market Committee, Sohana. Accordingly, this appeal is dismissed. (ADARSH KUMAR GOEL) ACTING CHIEF JUSTICE July 12, 2011 ( AJAY KUMAR MITTAL ) ashwani JUDGE 2

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