ODISHA INDUSTRIAL INFRASTRUTURE DEVELOPMENT CORPORATION(IDCO),BHUBANESWAR vs. DCIT,CIRCLE-4(1), BHUBANESWAR

ITA 408/CTK/2024Status: DisposedITAT Cuttack08 October 2026AY 2017-189 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal decided in favour of the assessee regarding the premium on the lease of land/shed. It noted that the Pr. CIT had previously considered this issue under Section 263 and accepted the assessee's claim that the premium is a capital receipt, as IDCO is not the owner of the plots and the ownership remains with the state government. Since the revenue did not demonstrate any change in facts from Assessment Year 2015-16 to the impugned Assessment Year 2017-18, the Assessing Officer was directed to delete the addition, following the Pr. CIT's decision. Regarding CSR expenses, the Tribunal respectfully followed the decision of a coordinate bench in a similar case for Assessment Year 2015-16. The coordinate bench had held that Explanation 2 to Section 37(1) is not applicable to the assessee as it is a corporation established by the state government as a trust and not registered under the Companies Act. However, as no details of the CSR expenses were filed before the lower authorities, the issue was set aside and restored to the file of the Assessing Officer for examination afresh, with sufficient opportunity to be given to the assessee. The appeal was partly allowed.

What were the facts?

The assessee, Odisha Industrial Infrastructure Development Corporation (IDCO), filed an appeal against the order of the NFAC, Delhi, for Assessment Year 2017-18. The appeal challenges two main issues: the treatment of premium on land lease and CSR expenses. For the land lease premium, the Assessing Officer (AO) treated it as revenue receipt, contrary to the assessee's claim of it being a capital receipt. The assessee referred to a previous order under Section 263 where the Pr. CIT accepted the claim that IDCO is not the owner of the plots and the premium is a capital receipt. Regarding CSR expenses, the assessee claimed expenses for promoting hockey. The AO disallowed these expenses, and the CIT(A) confirmed the disallowance. The assessee argued that Explanation 2 to Section 37(1) is not applicable to it as it is a corporation established by the state government as a trust, not registered under the Companies Act. A coordinate bench had previously restored the CSR issue to the AO for re-examination.

What were the issues?

1. Whether the premium received on the lease of land/shed is a capital receipt or a revenue receipt, considering the assessee's role as a nodal agency for industrial infrastructure development and the ownership of land residing with the state government. 2. Whether the CSR expenses claimed by the assessee for promoting hockey are allowable as a deduction, particularly in light of Explanation 2 to Section 37(1) of the Income Tax Act, 1961, and the assessee's status as a state government-established corporation. Assessee's contentions: The premium on lease of land/shed is a capital receipt, as IDCO is not the owner of the land, and ownership vests with the state government. For CSR expenses, Explanation 2 to Section 37(1) is not applicable as IDCO is a corporation established by the state government as a trust and not registered under the Companies Act. The assessee relied on a previous order under Section 263 regarding the land lease premium and a coordinate bench's decision on CSR expenses for Assessment Year 2015-16. Revenue's contentions: The revenue vehemently supported the orders of the Assessing Officer and the CIT(A). No specific authorities or precedents were mentioned by the revenue in the judgment.

Which sections of the Income-tax Act were involved?

Section 37(1),Section 263

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK

Before: SHRI GEORGE MATHAN & SHRI GOPALAN GURUSAMY

Hearing: 08/10/2026Pronounced: 08/10/2026

Per Bench: This is an appeal filed by the assessee against the order of NFAC, Delhi [in short ‘CIT(A)] in Appeal No.CIT(A), Bhubaneswar-2/10212/2019- 20 dated 28/12/2023 for the assessment year 2017-18. 2. Shri Sunil Mishra & Aman Agrawala, ARs represented on behalf of the assessee and Shri Ashis Chandra Mohanty, CIT-DR represented on behalf of the revenue.

3.

It was submitted by the ld. AR that there are two issues in the assessee’s appeal. One issue is the trea

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 37(1)

All 6,995 judgments and leading authorities on Section 37(1) →

Recent GST High Court judgments

Search GST case law →