Commissioner Of Incoem Tax vs. Krishi Upaj Mandi Samiti

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MAIT/120/2007HC Madhya Pradesh22 January 2020Author: HON'BLE THE CHIEF JUSTICE2 pages
For Petitioner: Sanjeev Tuli,S.Lal,A.JainFor Respondent: Govind Patel,Rajeev Verma
AI SummaryDismissed

What did the High Court hold?

The High Court held that the Revenue did not dispute that a detailed order passed in a similar case, M.A.I.T.No.114/2007 (The Commissioner of Income Tax-II, Jabalpur Vs. Krishi Upaj Mandi Samiti, Raheli, District Sagar) on 21.11.2019, would govern the decision of this appeal. In view of the order dated 21.11.2019 passed in that case, where the appeal was dismissed, this appeal is also dismissed. The specific reasoning for the dismissal in the cited case, and consequently for this appeal, is not elaborated upon in this judgment. The operative direction is the dismissal of the appeal. No issue was expressly left undecided.

What were the facts?

The Revenue (Commissioner of Income Tax, Gwalior) filed an appeal against an order of the Income Tax Appellate Tribunal (ITAT), Jabalpur Bench. The ITAT's order directed the registration of the assessee, Krishi Upaj Mandi Harpalpur, under Section 12A of the Income Tax Act, 1961. The appeal was admitted for hearing on substantial questions of law concerning the Tribunal's decision to grant registration without examining the merits of the order under Section 12AA by the CIT, and whether the assessee, having the status of a local authority before amendments to Sections 10(20) and 10(29), could be granted registration and exemption under Section 11. The Revenue did not dispute that a detailed order in a similar case, M.A.I.T.No.114/2007, would govern this appeal.

What were the issues?

The Tribunal had to decide the following substantial questions of law: 1. Whether the Tribunal was correct in granting registration under Section 12A by following ITAT decisions in Market Committee, Sular Gharat & others V/s CIT and Agricultural Produce Delhi, without considering the merits of the CIT's order under Section 12AA? 2. Whether the Tribunal was correct in granting registration under Section 12A to the assessee, despite its status as a local authority prior to the amendments in Sections 10(20) and 10(29) of the IT Act, thereby allowing exemption under Section 11? 3. Whether the assessee could be treated as a charitable institution, given that its activities had not changed, in light of the findings in the order under Section 12AA(i)(b)(ii)? Assessee's Contentions: Not recorded in the judgment. Revenue's Contentions: The Revenue argued that the Tribunal erred in granting registration under Section 12A without examining the merits of the CIT's order under Section 12AA. They also contended that the assessee, having been a local authority before amendments to Sections 10(20) and 10(29), should not be granted registration and exemption under Section 11. The Revenue also questioned the charitable status of the assessee if its activities remained unchanged, in light of Section 12AA(i)(b)(ii).

Which sections of the Income-tax Act were involved?

Section 12A,Section 12AA,Section 11,Section 10(20),Section 10(29)

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
-( 1 )- THE HIGH COURT OF MADHYA PRADESH: JABALPUR (Division Bench) M.A.I.T.No.120/2007 Commissioner of Income Tax, Gwalior (M.P.) ...Appellant/Revenue Versus Krishi Upaj Mandi Samiti, Harpalpur, District Chhatarpur (M.P.) ...Respondent/assessee Coram Hon’ble Shri Justice Ajay Kumar Mittal, Chief Justice Hon’ble Shri Justice Vijay Kumar Shukla, Judge Appearance Shri Sanjay Lal, Advocate for the appellant/Revenue. Shri Govind Patel, Advocate for the respondent.

O R D E R (22.01.2020)

Per: Ajay Kumar Mittal, C.J. (Oral)

The Revenue has filed this appeal against the order of the Income Tax Appellate Tribunal, Jabalpur Bench, Jabalpur passed in I.T.A.No.300/Jab/2006 dated 31.01.2007 directing registration of the assessee-Krishi Upaj Mandi under Section 12A of the Income Tax Act, 1961. 2. This appeal was admitted on 8.10.2007 for determination of the following substantial questions of law:- “(i) Whether the Tribunal was right in granting registration under Section 12-A following the decision of ITAT ‘A’ Bench, Delhi in the case of Market Committee, Sular Gharat & others V/s CIT and also the ITAT Nagpur ‘A’ Bench in the case of Agricultural Produce Delhi without going into the merits of the order under Section 12-AA of the IT Act by CIT?

(ii) Whether the Tribunal was right in granting registration under Section 12-A to the assessee inspite of the fact that the assessee had the status of local authority before the amendment made in Section 10(20) and 10(29) of the IT Act w.e.f. A.Y. 2003-04 and also later on and thereby allowing exemption under Section 11 of the IT Act?

(iii) Whether the activities of the trust not having been changed, whether the assessee can be treated as a charitable institution in the light of the finding given in the order under Section 12-AA(i)(b)(ii)?”

3.

It was not disputed by the learned counsel for the revenue that detailed order passed in M.A.I.T.No.114/2007 (The Commissioner of Income Tax-II, -( 2 )-

21.11.

2019 would govern the decision of this appeal. Accordingly, in view of the order dated 21.11.2019 passed in M.A.I.T.No.114/2007 (The Commissioner of Income Tax-II, Jabalpur Vs. Krishi Upaj Mandi Samiti, Raheli, District Sagar), where the appeal has been dismissed, this appeal is also dismissed.

(Ajay Kumar Mittal) (Vijay Kumar Shukla) Chief Justice

Judge

C. PHILIP Date: 2020.01.27 17:12:32 +05'30'

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