SREE SUDHEENDRA MEDICAL MISSION vs. THE DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTION)

ITA/152/2014HC KeralaKLHC01026718201419 August 2015Author: HONOURABLE MR. JUSTICE SHAJI P.CHALY,HONOURABLE MR.JUSTICE ANTONY DOMINIC6 pages
AI SummaryPartly Allowed

What were the facts?

The assessee, Sree Sudheendra Medical Mission, filed an appeal before the High Court of Kerala challenging an order of the Income Tax Appellate Tribunal (ITAT), Cochin Bench, for the assessment year 2008-2009. The appeal concerned two questions of law framed by the assessee. The ITAT had rejected the assessee's claim for depreciation on assets whose cost had been fully allowed as application of income under Section 11 in prior years. The Tribunal also doubted its power to direct the assessee to write back depreciation, unlike a previous High Court ruling.

What did the High Court hold?

The High Court addressed two questions of law. For the first question, regarding depreciation on assets whose cost was fully allowed as application of income in past years, the Court referred to its previous judgment in Lissie Medical Institutions v. Commissioner of Income-Tax, wherein this question was answered against the assessee. Therefore, this question was not considered further. Regarding the second question, concerning the write-back of depreciation, the High Court noted that the Tribunal had doubted its power to grant such relief, citing the Lissie Medical Institutions case as a specific concession. However, the High Court found that in Lissie Medical Institutions, it had indeed granted relief to the assessee, allowing them to write back depreciation for the current and previous years and carry it forward for subsequent years for charitable application, while confirming the assessment order. Since the facts of the present case were similar, the High Court applied the principle laid down in Lissie Medical Institutions and answered the second question in favour of the assessee, allowing the relief.

What were the issues?

1. Whether the Tribunal ought to have allowed depreciation on assets whose cost was fully allowed as application of income under Section 11 in past years? (Question of law) 2. Whether the Tribunal ought to allow the appellant to write back depreciation for the relevant year and previous years, and allow it to be carried forward for subsequent years? (Question of mixed law and fact, concerning Section 11 of the Income Tax Act, 1961) Assessee's Contentions: - The assessee argued that depreciation should be allowed on assets whose cost was previously allowed as application of income. (Implied by framing of the first question). - The assessee contended that the Tribunal should grant similar directions for writing back depreciation as given by the High Court in the case of Lissie Medical Institutions. Revenue's Contentions: - The revenue, through its counsel, submitted that the accumulation of income is governed by Explanation 2 to Section 11(1) and Section 11(2) of the Act. - The revenue argued that the High Court's decision in Lissie Medical Institutions was a concession applicable only to that particular assessee, and the Tribunal, as a creature of statute, cannot exercise powers vested with the High Court.

Which sections of the Income-tax Act were involved?

Section 11,Section 11(1),Section 11(2)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE ANTONY DOMINIC & THE HONOURABLE MR. JUSTICE SHAJI P.CHALY WEDNE AY, THE 19TH DAY OF AUGUST 2015/28TH SRAVANA, 1937 ITA.No. 152 of 2014 () ----------------------- AGAINST THE ORDER IN ITA 30/2014 OF THE INCOME TAX APPELLATE TRIBUNAL,COCHIN BENCH DATED 04-04-2014 APPELLANT: ----------------- SREE SUDHEENDRA MEDICAL MISSION CHITTOOR ROAD, ERNAKULAM, KOCHI 682 018. BY ADVS.SRI.ANIL D. NAIR SRI.R.SREEJITH SMT.C.S.SULEKHA BEEVI SMT.ROSIE ATHULYA JOSEPH SRI.JOSE JOSEPH CHEMPLAYIL RESPONDENT: --------------------- THE DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTION) ERNAKULAM

BY ADV. SRI.JOSE JOSEPH, SC, FOR INCOME TAX THIS INCOME TAX APPEAL HAVING BEEN FINALLY HEARD ON 19.08.2015, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

ITA.No. 152 of 2014 APPENDIX APPELLANT'S ANNEXURES: ANNEXURE – A :OF THE ORDER OF ASSESSMENT FOR THE YEAR 2008-09 ISSUED TO THE APPELLANT. ANNEXURE – B :OF THE ORDER OF THE COMMISSIONER OF INCOME TAX. ANNEXURE – C : CERTIFIED COPY OF THE ORDER OF THE INCOME TAX APPELL

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 11

All 7,109 judgments and leading authorities on Section 11 →

Recent GST High Court judgments

Search GST case law →