THE INCOME TAX OFFICER( EXEM vs. M/S.ARULMIGU DEVI KARUMARIAM

PDF · subscribers
TCA/81/2020HC Madras18 February 2020Bench: Hon`ble Mr Justice N. KIRUBAKARAN6 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that no question of law arises for consideration as the appeal is devoid of merits. The Court observed that the Income Tax Appellate Tribunal had allowed the appeal filed by the assessee. While dismissing the appeal, the Court granted liberty to the Department to proceed against the trustees and committee members responsible for the administration and management of the temple's funds for any mismanagement or misappropriation that may have led to a loss of public money and government revenue. The operative direction was to dismiss the appeal. No issue was expressly left undecided, but the focus shifted to potential mismanagement by the temple's administrators.

What were the facts?

The respondent, M/s.Arulmigu Devi Karumariamman Thirukoil, a Hindu temple managed by the Government of Tamil Nadu's Hindu Religious and Endowment Department, sought exemption under Section 10(23C)(v) of the Income Tax Act, 1961. The temple had prior approval for exemption, which expired before Assessment Year 2015-2016. The respondent failed to apply for renewal by the September 2015 deadline for AY 2015-2016, filing the application only in 2016. The appellant (Income Tax Officer) granted exemption from AY 2016-2017 onwards via an order dated 03.11.2016, later modified on 28.12.2017. Consequently, the respondent's income for AY 2015-2016 was deemed taxable. The respondent challenged the appellant's orders before the Income Tax Appellate Tribunal, which allowed the appeal. The appellant (Revenue) then filed the present appeal before the High Court.

What were the issues?

1. Whether a question of law arises for consideration in this appeal, given the facts and circumstances of the case? Assessee's contentions: The judgment does not record specific contentions made by the assessee before the High Court. However, the fact that the Income Tax Appellate Tribunal allowed the assessee's appeal implies the assessee argued successfully before the Tribunal that the exemption should be granted or that the denial for AY 2015-2016 was incorrect. Revenue's contentions: The appellant (Revenue) contended that the appeal raises a question of law. The Revenue's primary grievance stems from the Tribunal allowing the assessee's appeal, which implies the Revenue argued that the assessee was not entitled to the exemption for AY 2015-2016 due to the delayed application and that the Tribunal erred in its decision.

Which sections of the Income-tax Act were involved?

Section 10(23C)(v),Section 260A

AI-generated summary — verify with the full judgment below

T.C.A.No.81 of 2020 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 18.02.2020 CORAM : THE HONOURABLE MR.JUSTICE N.KIRUBAKARAN and THE HONOURABLE MR.JUSTICE P.VELMURUGAN T.C.A.No.81 of 2020 The Income Tax Officer (Exemptions), 121, M.G.Road, Nungambakkam, Chennai - 600 034.

... Appellant Vs M/s.Arulmigu Devi Karumariamman Thirukoil, Thiruverkadu, Poonamalle Taluk, Chennai - 600 077.

...Respondent PRAYER: Tax Case Appeal filed under Section 260A of Income Tax Act, 1961 against the order dated 16.11.2018 in I.T.A.No.1090/Chny/2018 on the file of the Income Tax Appellate Tribunal, 'B' Bench, Chennai. For Appellant : Mr.J.Narayasamy, Senior Standing Counsel. For Respondent : Mr.N.V.Balaji.

1/6 http://www.judis.nic.in T.C.A.No.81 of 2020 J U D G M E N T (Judgment of the Court was delivered by N.KIRUBAKARAN, J) This tax case appeal has been filed against the order of the Income Tax Appellate Tribunal dated 16.11.2018 in I.T.A.No.1090/Chny/2018 in allowing the appeal filed by the assessee 2.The facts of the case are as follows: The Respondent is a Hindu temple situated at the aforementioned address that falls within the purview and consequently is managed under the Hindu Religious and Endowment Department of the Government of Tamil Nadu. Under Section 10 (23C) (v) of the Income Tax Act, 1961, income received on behalf of trusts or institutions operating wholly for religious or charitable purposes is exempted for the purpose of the calculation of income tax under the Act. Section 10 (23C) provides that in computing the total income of a previous year of any person, any income falling within any of the clauses shall not be included. However, the exemption envisaged under Section 10 (23C) (v) is granted only on the basis of a specific application to this effect and the grant of approval by the prescribed authority. The various criteria 2/6 http://www.judis.nic.in T.C.A.No.81 of 2020 that the prescribed authority should consider at the time of granting approval for such exemption is contained in the various provisos to Section 10 (23C). 3.It is seen that in the present case the respondent was granted approval for exemption under this provision by way of a Government Notification No.8354 dated 08.05.1989. This approval was renewed from time to time subsequently. This approval expired before the assessment year 2015-2016 and therefore, the respondent had to gain approval from the appellant in order to continue enjoying the exemption available under the said provision. 4.The respondent being aware of this did not apply for approval under Section 10 (23C) (v) for the Assessment Year 2015- 2016 by September 2015 as required under Section 10 (23C). The respondent filed an application for exemption later in the year 2016. The Appellant considered this application and granted exemption to the respondent by way of its Order dated 03.11.2016 which was to be effective from the assessment year 2016-2017 onwards. This order was 3/6 http://www.judis.nic.in T.C.A.No.81 of 2020 also subsequently modified by way of the appellant's order dated 28.12.2017. Since the respondent had not applied for an exemption for the Assessment year 2015-2016 and since the time to file such an application had expired, the same could not be granted and the income of the respondent was therefore liable for tax during the Assessment year 2015-2016. 5.The Respondent challenged the Order dated 03.11.2016 that was subsequently modified on 28.12.2017 before the Income Tax Tribunal. The challenge was dismissed and therefore, the respondent appealed before the Income Tax Appellate Tribunal. The said appeal was allowed by way of the Income Tax Appellate Tribunal's Order dated 16.11.2018. Aggrieved over the said order, the appellant filed the present appeal before this Court. 6.Heard Mr.J.Narayasamy, learned Senior Standing Counsel for the appellant and Mr.N.V.Balaji, learned Counsel for the respondent. 4/6 http://www.judis.nic.in T.C.A.No.81 of 2020 7.There is no question of law arising for consideration as the appeal is devoid of merits. However, liberty is given to the Department to proceed against the trustees and committee members dealing with administration and the monies of the temple for the mismanagement and misappropriation leading to loss of public monies and the Government revenue, if any. 8.With the above observations, this appeal is dismissed. No costs.

(N.K.K.,J.) (P.V.,J.) 18.02.2020 ay To The Income Tax Officer (Exemptions), 121, M.G.Road, Nungambakkam, Chennai - 600 034. 5/6 http://www.judis.nic.in T.C.A.No.81 of 2020 N.KIRUBAKARAN, J. and P.VELMURUGAN, J. ay T.C.A.No.81 of 2020 Dated:18.02.2020 6/6 http://www.judis.nic.in

More judgments on Section 10(23C)(v)

All 37 judgments and leading authorities on Section 10(23C)(v) →

Recent GST High Court judgments

Search GST case law →