The Commissioner Of Income Tax vs. Krishi Upaj Mandi Samiti, Betul

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MAIT/175/2007HC Madhya Pradesh25 November 2019Author: HON'BLE THE CHIEF JUSTICE2 pages
For Petitioner: Sanjeev Tuli,S.LalFor Respondent: Vivekanand Awasty,P. Choubey,Vikalp Soni
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The Court noted that the Revenue's counsel did not dispute that a detailed order passed in MAIT No. 114/2007 (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. Since the appeal in MAIT No. 114/2007 was dismissed, this appeal was also dismissed in view of that precedent. The specific questions of law and fact were not independently decided on their merits in this judgment, as the dismissal was based on the outcome of a similar, previously decided 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's order directed the registration of the assessee, Krishi Upaj Mandi Samiti, Badora, District Betul, 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, could be treated as a charitable institution for exemption under Section 11. The Revenue's counsel did not dispute that a detailed order in a similar case, MAIT No. 114/2007, would govern this appeal.

What were the issues?

1. Whether the Tribunal was correct in granting registration under Section 12A by following ITAT decisions in the cases of Market Committee, Sular Gharat & others V/s CIT and Agricultural Produce Delhi, without adjudicating the merits of the order passed by the CIT under Section 12AA of the Income Tax Act, 1961? (Question of law) 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) of the Income Tax Act, 1961, thereby allowing exemption under Section 11? (Question of mixed law and fact) 3. Whether, if the activities of the trust remained unchanged, the assessee could be considered a charitable institution in light of the findings in the order under Section 12AA(i)(b)(ii)? (Question of mixed law and fact) Assessee's arguments: Not recorded. Revenue's arguments: The Revenue contended that the Tribunal erred by granting registration under Section 12A without examining the merits of the CIT's order under Section 12AA and questioned the eligibility for exemption under Section 11 given the assessee's status as a local authority.

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.175/2007 Commissioner of Income Tax, Bhopal (M.P.) ...Appellant/Revenue Versus Krishi Upaj Mandi Samiti, Badora, District Betul (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.317/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)?”

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) (Mohd. Fahim Anwar) Chief Justice

Judge

C. CHRISTOPHER PHILIP Date: 2020.01.27 16:58:42 +05'30'

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