THE COMMISSIONER OF INCOMETAX -I vs. RAJDEEP AND PMCC INSFRASTRUCTURE

PDF · subscribers

TA/2/2010HC BombayHCBM03001413201022 January 2014Author: HON'BLE SHRI JUSTICE S C DHARMADHIKARI,HON'BLE SHRI JUSTICE RAVINDRA V. GHUGE3 pages

AI SummaryDismissed

What did the High Court hold?

The High Court held that in the peculiar facts of the case, no income accrued to the assessee, an Association of Persons (AOP). The Tribunal's finding was based on its earlier orders, which established that when no income accrues to the AOP but rather to its individual constituents who undertake contract portions at their own risk and in their individual capacities, the AOP is not liable to be taxed. The High Court found that this view was consistent with the materials on record. Consequently, the Court concluded that no substantial question of law arose for determination. Both appeals filed by the Commissioner of Income Tax were dismissed.

What were the facts?

The appeals were filed by the Commissioner of Income Tax (Appeals) against the order of the Income Tax Appellate Tribunal (ITAT). The assessee is an Association of Persons (AOP) named Rajdeep & PMCC Infrastructure, Ahmednagar. The ITAT had previously held that no income accrued to the AOP. The ITAT's decision was based on the peculiar facts of the case, where the constituents of the AOP were to perform specified portions of a contract at their own risk and in their individual capacities. The High Court was considering the assessment order and the order passed by the Commissioner of Income Tax (Appeals).

What were the issues?

1. Whether, in the peculiar facts of the case, income accrued to the assessee, an Association of Persons (AOP), for the purpose of taxation? (Question of law and fact, concerning the accrual of income to an AOP). Assessee's Contentions: The assessee argued that no income accrued to the AOP. The income, if any, accrued to the respective constituents of the AOP who undertook specific portions of a contract at their individual risks and capacities. The ITAT had relied on its earlier orders supporting this view. Revenue's Contentions: The judgment does not record specific contentions made by the revenue. However, the appeal itself by the Commissioner of Income Tax indicates a disagreement with the ITAT's finding that no income accrued to the AOP.

AI-generated summary — verify with the full judgment below

(1) ta2310 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD TAX APPEAL NO. 2 OF 2010 The Commissioner of Income Tax 1, Pune APPELLANT VERSUS Rajdeep & PMCC Infrastructure, Ahmednagar RESPONDENT AND TAX APPEAL NO. 3 OF 2010 The Commissioner of Income Tax 1, Pune APPELLANT VERSUS Rajdeep & PMCC Infrastructure, Ahmednagar RESPONDENT ..... Mr. Alok Sharma, Assistant Solicitor General, for the appellant in both the appeals. Mr. P.P. Dhawalkar, Advocate for the respondent in both the appeals. ..... CORAM : S.C. DHARMADHIKARI AND RAVINDRA V. GHUGE, JJ. DATED : 22nd January, 2014 PER COURT :

We have heard Mr. Alok Sharma, learned Assistant Solicitor General, appearing on behalf of the appellants and with his assistance, we have perused the assessment order and the order passed by the Commissioner of Income Tax (Appeals)I, Pune,

(2) ta2310 dated 05.11.2008 and 25.09.2006. We have also perused the order passed by the Income Tax Appellate Tribunal (ITAT).

The Tribunal itself has held that in the peculiar facts of the case, no income accrued to the assessee – AOP (Association of Persons) before the Tribunal. The Tribunal has relied upon its earlier orders and to the effect that when no income accrues to the AOP but to the respective constituents of the AOP who were to do specified portion of a contract at their own risks and in their individual capacities, then the AOP is not liable to be taxed. This view is consistent with the materials placed on record. Since it is in the peculiar facts of the case before the Tribunal and the Commissioner of Income Tax (Appeals), we do not feel that any substantial question of law arises for determination and consideration in these appeals. Both the appeals are, therefore, dismissed. [ RAVINDRA V. GHUGE ] [ S.C. DHARMADHIKARI ] JUDGE

JUDGE npj/ta2310

(3) ta2310

Recent GST High Court judgments

Search GST case law →