CIT-FARIDABAD vs. NEW VIKAS COOP. HOUSE BUILD. SOCITY. LTD.

ITA/292/2009HC Punjab & HaryanaPHHC01084384200909 January 2014Author: MR. JUSTICE SURINDER GUPTA,MR. JUSTICE RAJAN GUPTA4 pages
AI SummaryRemanded

What were the facts?

The Revenue (Commissioner of Income Tax, Faridabad) appealed to the High Court against an order of the Income Tax Appellate Tribunal (ITAT) for Assessment Year 2000-01. The assessee, The New Vikas Cooperative House Building Society Limited, received enhanced compensation of ₹8,73,93,278 and interest of ₹4,70,68,031 in FY 2002-03. The assessee did not file a return, and a notice under Section 148 was issued. The assessment was completed under Sections 147/143(3), including the interest on enhanced compensation on an accrual basis. The CIT(A) allowed the assessee's appeal, holding the society as a mutual benefit concern and deleting the additions based on a High Court judgment. The ITAT dismissed the Revenue's appeal.

What did the High Court hold?

The High Court, in view of subsequent decisions of the High Court in cases like CIT v. Shri Prem Singh, CIT, Faridabad v. Karambir Singh L/H of Late Shri Khushi Ram, CIT, Faridabad v. Bir Singh (HUF) Ballabgarh, and the Apex Court in Bangalore Club vs. Commissioner of Income Tax and another, along with the insertion of Explanation to Section 2(31) by the Finance Act, 2002 (effective from 1.4.2002), found that the matter required adjudication afresh. Consequently, the High Court remanded the appeals to the Tribunal to adjudicate the issues anew in accordance with the law. The appeals were disposed of accordingly, with no specific finding on the merits of the issues by the High Court.

What were the issues?

1. Whether the ITAT was correct in holding that the activities of the society were governed by the principle of mutuality (Section 2(24) of the Income Tax Act, 1961)? - Assessee's contention: Not recorded. - Revenue's contention: Not recorded. 2. Whether the amount of compensation and interest received by the assessee under interim orders of the High Court during the pendency of appeals by the State could be charged to tax under Section 45(5)(b) of the Income Tax Act, 1961, given that the assessee was not considered a 'person' under Section 2(31) before 1.4.2002, thus not attracting tax under Section 4? - Assessee's contention: The receipts did not attract tax due to the assessee not being a 'person' under Section 2(31) before 1.4.2002 and the amounts being received under interim orders pending finality. - Revenue's contention: Not recorded.

Which sections of the Income-tax Act were involved?

Section 260A,Section 139(1),Section 148,Section 147,Section 143(3),Section 2(24),Section 45(5)(b),Section 2(31),Section 4

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Date of decision:09.1.2014 Commissioner of Income Tax, Faridabad ...Appellant Versus The New Vikas Cooperative House Building Society Limited

...Respondent CORAM: HON'BLE MR.JUSTICE AJAY KUMAR MITTAL HON'BLE MS. JUSTICE ANITA CHAUDHRY Present: Mr. Tajinder K.Joshi, Advocate for the appellant. Mr. Sanjay Bansal, Sr. Advocate with Mr. Vijay Gupta, Advocate, for the respondent. Ajay Kumar Mittal,J.

1.

This order shall dispose of ITA Nos. 292, 313 to 316 of 2009 as the legal issue involved therein is identical. All the appeals arise from the common order of the Tribunal dated 12.9.2008. However, the facts are being extracted from ITA No.292 of 2009. 2. ITA No.292 of 2009 has been preferred by the revenue under section 260A of the Income Tax Act, 1961 (in short, “the Act”) against the order dated 12.9.2008, Annexure A.III passed by the Income Tax Appellate Tribunal, Delhi Bench 'F' New Delhi (in short, “the Tribunal”) in ITA No.2215/DEL/2008 for the assessment year 2000-01. On 10.3.2010, this Court while admitting the appeal had passed the

The order continues below.

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