Commissioner Of Income Tax vs. Krishi Upaj Mandi Samiti Londi

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MAIT/121/2007HC Madhya Pradesh22 January 2020Author: HON'BLE THE CHIEF JUSTICE2 pages
For Petitioner: Sanjeev Tuli,S.Lal,A.JainFor Respondent: Rameshwar P Singh
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The Court acknowledged that a detailed order had been passed in a similar matter, M.A.I.T.No.114/2007 (Commissioner of Income Tax-II, Jabalpur Vs. Krishi Upaj Mandi Samiti, Raheli, District Sagar) on November 21, 2019, which would govern the decision of the present appeal. In that prior case, the appeal was dismissed. Therefore, following that precedent, the present appeal was also dismissed. The specific findings on the substantial questions of law were not elaborated upon in this judgment, as it relied on the outcome of the earlier, similar appeal. The operative direction was the dismissal of the Revenue's appeal.

What were the facts?

The Revenue (Commissioner of Income Tax, Gwalior) appealed against an order of the Income Tax Appellate Tribunal (ITAT), Jabalpur Bench. The ITAT's order, dated January 31, 2007, directed the registration of the assessee, Krishi Upaj Mandi Samiti, Londi, District Chhatarpur, under Section 12A of the Income Tax Act, 1961. The appeal was admitted on October 8, 2007, for determining substantial questions of law. The High Court noted that a detailed order in a similar case, M.A.I.T.No.114/2007 (Commissioner of Income Tax-II, Jabalpur Vs. Krishi Upaj Mandi Samiti, Raheli, District Sagar), decided on November 21, 2019, would govern the present appeal. Consequently, the appeal was dismissed.

What were the issues?

The Tribunal had to decide three 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 examining the merits of the order passed by the CIT under Section 12AA of the IT Act? 2. Whether the Tribunal was correct in granting registration under Section 12A to the assessee, despite its status as a local authority before the amendment of Sections 10(20) and 10(29) effective from Assessment Year 2003-04, thereby allowing exemption under Section 11? 3. Whether, if the trust's activities remained unchanged, the assessee could be considered a charitable institution in light of the findings under Section 12AA(i)(b)(ii)? Contentions: Assessee: Not recorded in the judgment. Revenue: Argued that the Tribunal erred in granting registration under Section 12A without considering the merits of the CIT's order under Section 12AA, and that the assessee, being a local authority, should not be eligible for exemption under Section 11, especially after amendments to Sections 10(20) and 10(29). The revenue also questioned the charitable status of the assessee if its activities had not changed.

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.121/2007 Commissioner of Income Tax, Gwalior (M.P.) ...Appellant/Revenue Versus Krishi Upaj Mandi Samiti, Londi, 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 R.P.Singh, 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.301/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 17:13:46 +05'30'

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