The Commissione Ro Income Tax vs. Krishi Upaj Mandi Samiti Raisen

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MAIT/176/2007HC Madhya Pradesh25 November 2019Author: HON'BLE THE CHIEF JUSTICE2 pages
For Petitioner: Sanjeev Tuli ,S.LalFor Respondent: Samdarshi Tiwari, Pranay Choubey, Nk. Choudhary[1]
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The decision was based on a prior order 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), dated 21.11.2019, where the appeal was also dismissed. Consequently, the present appeal was also dismissed in line with that precedent. The specific reasoning or findings of the Tribunal on the individual issues raised in the appeal were not elaborated upon in this judgment, as the High Court relied on the outcome of the earlier, similar case. No specific operative directions were issued beyond the dismissal of the appeal.

What were the facts?

The Revenue, Commissioner of Income Tax, Bhopal, filed an appeal against an order of the Income Tax Appellate Tribunal (ITAT), Indore Bench. The ITAT had directed the registration of the assessee, Krishi Upaj Mandi Samiti, Raisen, under Section 12A of the Income Tax Act, 1961. The appeal was admitted for hearing on substantial questions of law concerning the validity of granting registration under Section 12A, particularly in light of amendments to Sections 10(20) and 10(29) and the assessee's status as a local authority. The High Court noted that a detailed order had been passed in a similar matter, M.A.I.T.No.114/2007, which would govern the present appeal.

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 prior ITAT decisions in the cases of Market Committee, Sular Gharat & others V/s CIT and Agricultural Produce Delhi, without examining the merits of the order under Section 12AA passed by the CIT? 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 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 in the order under Section 12AA(i)(b)(ii)? The Revenue contended that the Tribunal erred by not considering the merits of the CIT's order and by granting registration despite the assessee's status as a local authority and subsequent amendments to relevant sections. The judgment does not record specific arguments from the assessee.

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.176/2007 Commissioner of Income Tax, Bhopal (M.P.) ...Appellant/Revenue Versus Krishi Upaj Mandi Samiti, Raisen, District Raisen (M.P.) ...Respondent/assessee Coram Hon’ble Shri Justice Ajay Kumar Mittal, Chief Justice Hon’ble Shri Justice Mohd. Fahim Anwar, Judge Appearance Shri Sanjay Lal, Advocate for the appellant/Revenue.

O R D E R (25.11.2019)

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

The Revenue has filed this appeal against the order of the Income Tax Appellate Tribunal, Indore Bench, Indore passed in I.T.A.No.311/Ind/2007 dated 18.5.2007 directing registration of the assessee-Krishi Upaj Mandi under Section 12A of the Income Tax Act, 1961. 2. This appeal was admitted on 9.1.2007 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)?”

-( 2 )-

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, 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) (Mohd. Fahim Anwar) Chief Justice

Judge

C. PHILIP Date: 2020.01.27 16:59:28 +05'30'

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