THE COMMISSIONER OF INCOME TAX -EXEMPTION vs. ASSOCIATION OF STATE ROAD TRANSPORT UNDERTAKING

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ITA/719/2019HC DelhiDLHC01032357201915 December 2022Bench: HON'BLE MR. JUSTICE RAJIV SHAKDHER,HON'BLE MS. JUSTICE TARA VITASTA GANJU2 pages
AI SummaryDismissed

What did the High Court hold?

The Delhi High Court noted that a coordinate bench had previously ruled in favour of the respondent/assessee on merits in a similar matter concerning AY 2009-2010 (ITA 154/2021). Given this prior decision, the High Court held that the questions of law proposed in the present appeal had become academic. Therefore, the appeal was disposed of without delving into the merits of the specific issues raised by the revenue. The operative direction was to dispose of the appeal as academic, given the favourable decision for the assessee on merits in a related case. No issue was expressly left undecided, as the appeal was rendered academic.

What were the facts?

The appeal by the Commissioner of Income Tax (Exemption) challenges an order dated 29.11.2018 passed by the Income Tax Appellate Tribunal (ITAT) concerning assessment year (AY) 2010-2011. The ITAT had allowed the appeal of the assessee, Association of State Road Transport Undertaking. The revenue contends that the ITAT failed to adjudicate the issue of incorrect exemption allowance and erred in allowing the assessee's appeal despite the proviso to Section 2(15) being attracted, which would have made a larger sum taxable. Furthermore, the revenue argues that the ITAT erred in directing the CIT(A) to decide the assessee's appeal on merits, as the assessee had withdrawn its appeal before the CIT(A).

What were the issues?

1. Whether on the facts and in the circumstances of the case and in law, the learned ITAT has erred in not adjudicating the issue pertaining to incorrect allowance of benefit of exemption to the Assessee? 2. Whether on the facts and in circumstances of the case and in law, the learned ITAT has erred in allowing the appeal of the Assessee by ignoring the fact that since proviso to section 2(15) has been attracted in this case, the Assessing Officer considered it a clear case of mistake apparent from record, which needs to be rectified. As such whole amount of Rs.5,43,40,483/- was required to be taxed instead of Rs.63,15,340/? 3. Whether on the facts and in the circumstances of the case and in law, the learned ITAT has erred in allowing the appeal of the Assessee and thus directing the learned CIT(A) to decide, on merits, the appeal of the Assessee filed against the order under section 143(3), even though the assessee itself had withdrawn the appeal before the learned CIT(A)? 4. Whether on the facts and in circumstances of the case and in law, the learned ITAT has erred in allowing the appeal of the Assessee and directing the learned CIT(A) to decide the appeal of the Assessee, filed against order under section 143(3) on merit, ignoring that the Assessee withdrew its appeal before learned CIT(A) and was thus dismissed as withdrawn? Assessee's Contentions: Not recorded. Revenue's Contentions: The ITAT erred in not adjudicating the exemption issue, in allowing the appeal despite the proviso to Section 2(15) being attracted, and in directing the CIT(A) to decide the appeal on merits when the assessee had withdrawn it before the CIT(A). The revenue relied on the fact that the Assessing Officer considered the matter a mistake apparent from record requiring rectification, with a larger sum to be taxed.

Which sections of the Income-tax Act were involved?

Section 2(15),Section 143(3)

AI-generated summary — verify with the full judgment below

$~15 * IN THE HIGH COURT OF DELHI AT NEW DELHI

+ ITA 719/2019

THE COMMISSIONER OF INCOME TAX -EXEMPTION

..... Appellant Through: Ms Ruchir Bhatia, Sr. Standing Counsel with Mr Shlok Chandra and Ms Mansie Jain, Advs.

versus

ASSOCIATION OF STATE ROAD TRANSPORT UNDERTAKING

..... Respondent Through: Mr Mayank Nagi, Adv. with Mr Tarun Singh, Adv.

CORAM:

HON'BLE MR. JUSTICE RAJIV SHAKDHER

HON'BLE MS. JUSTICE TARA VITASTA GANJU

O R D E R %

15.12.2022 [Physical Hearing/Hybrid Hearing (as per request)] 1. This appeal is directed against the order dated 29.11.2018 passed by the Income Tax Appellate Tribunal concerning assessment year (AY) 2010- 2011. 2. The questions of law proposed by the appellant/revenue are the following: “2.1 Whether on the facts & in the circumstances of the case and in law, ld. ITAT has erred in not adjudicating the issue pertaining to incorrect allowance of benefit of exemption to the Assessee? 2.2 Whether on the facts and in circumstances of the case and in law, ld. ITAT has erred allowing the appeal of the Assessee by ignoring the fact that since proviso to section 2(15) has been attracted in this case, the Assessing officer considered it a clear case of mistake apparent from

ITA 719/2019 Page 1 of 2 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/05/2026 at 16:42:43

record, which needs to be rectified. As such whole amount of Rs.5,43,40,483/- was required to be taxed instead ofRs.63,15,340/?- 2.3 Whether on the facts and in the circumstances of the case and in law, ld. ITAT has erred in allowing the appeal of the Assessee and thus directing the ld. CIT(A) to decide, on merits, the appeal of the Assessee filed against the order under section 143(3), even though the assessee itself had withdrawn the appeal before the ld. CIT(A)? 2.4 Whether on the facts and in circumstances of the case and in law, the ld. ITAT has erred in allowing the appeal of the Assessee and directing the ld. CIT(A) to decide the appeal of the Assessee, filed against order under section 143(3) on merit, ignoring that the Assessee withdrew its appeal before ld.CIT(A) and was thus dismissed as withdrawn?” 3. We are informed by the counsel for the parties that a coordinate bench, albeit on merits has ruled in favour of the respondent/assessee via a decision rendered on 30.09.2021 in ITA 154/2021, titled Commissioner of Income Tax (Exemptions) Delhi Vs. Association Of State Road Transport UndertakingsconcerningAY 2009-2010. 4. Given the aforesaid facts, we are of the view that the questions of law proposed have been rendered academic in the instant case, since the issue(s) on merits have been decided in favour of the respondent/assessee. 5. The above-captioned appeal is, accordingly, disposed of.

RAJIV SHAKDHER, J

TARA VITASTA GANJU, J

DECEMBER 15, 2022/SAClick here to check corrigendum, if any

ITA 719/2019 Page 2 of 2 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 29/05/2026 at 16:42:43

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