CIT, KARNAL vs. MARKET COMMITTEE, GHARAUNDA

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ITA/942/2008HC Punjab & HaryanaPHHC01080985200806 February 2009Author: MR. JUSTICE NAWAB SINGH,MR.JUSTICE J.S. KHEHAR2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court accepted the prayer of the learned counsel for the appellant (revenue) to leave the substantial question of law undecided. The Court noted that the controversy had been adjudicated upon by this Court in Commissioner of Income Tax-II, Amritsar Versus Market Committee, Dhariwal (ITA No.654 of 2005 decided on 14.3.2007). Consequently, the appeal was dismissed in terms of the order passed in the aforementioned case. The specific finding of the ITAT that the Market Committee is a Charitable Trust/Institution within the meaning of Section 2(15) was not directly addressed or overturned by the High Court in this judgment, as the question was left undecided. No operative directions were issued other than the dismissal of the appeal.

What were the facts?

The appeal was filed by the Commissioner of Income-tax, Karnal (the revenue) against an order of the Income-tax Appellate Tribunal (ITAT). The respondent assessee is the Market Committee, Gharaunda, Distt. Karnal. The assessment year(s) are not explicitly stated. The revenue challenged the ITAT's decision that the Market Committee is a Charitable Trust/Institution within the meaning of Section 2(15) of the Income-tax Act, 1961. The revenue's counsel acknowledged that the controversy was adjudicated by the High Court in a similar case, Commissioner of Income Tax-II, Amritsar Versus Market Committee, Dhariwal (ITA No.654 of 2005 decided on 14.3.2007). The amount in dispute is not stated.

What were the issues?

1. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was right in law in holding that the Market Committee is a Charitable Trust/Institution within the meaning of section 2(15) of the Income-tax Act, particularly when the legislature has clarified the charitable activities by inserting a proviso to section 2(15) of the Act by the Finance Act, 2008? Assessee's contentions: Not recorded. Revenue's contentions: The revenue argued that the ITAT was incorrect in holding the Market Committee as a charitable institution under Section 2(15), especially in light of the proviso inserted by the Finance Act, 2008. However, the revenue's counsel conceded that the issue had been decided by this Court in Commissioner of Income Tax-II, Amritsar Versus Market Committee, Dhariwal (ITA No.654 of 2005 decided on 14.3.2007) and requested that the substantial question of law be left undecided for an appropriate case.

Which sections of the Income-tax Act were involved?

Section 2(15)

AI-generated summary — verify with the full judgment below

ITA No.942 of 2008 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.

Date of Decision:-6.2.2009 The Commissioner of Income-tax, Karnal ---Appellant Versus Market Committee, Gharaunda, Distt.Karnal ---Respondent CORAM:- HON'BLE MR.JUSTICE J.S.KHEHAR HON'BLE MR.JUSTICE NAWAB SINGH Present:- Mr.Yogesh Putney, Advocate for the appellant. J.S.KHEHAR, J.(ORAL) Learned counsel for the appellant very fairly states that the controversy involved in the instant appeal has been adjudicated upon by this Court in Commissioner of Income Tax-II, Amritsar Versus Market Committee, Dhariwal (ITA No.654 of 2005 decided on 14.3.2007). Learned counsel for the appellant has, however, expressly invited our attention to the following substantial question framed by the appellant in the grounds of appeal:- “Whether on the facts and in the circumstances of the case, the Hon'ble ITAT was right in law in holding that the Market Committee is a Charitable Trust/Institution within the meaning of section 2(15) of the Income-tax Act, particularly when the legislature has clarified the charitable activities by inserting proviso to section 2(15) of the Act by the Finance Act, 2008?” It is the submission of the learned counsel for the appellant that the

ITA No.942 of 2008 2 aforesaid question may be left undecided for being raised in an appropriate case. Prayer made by the learned counsel for the appellant is accepted. The instant appeal is dismissed in terms of the order passed by this Court in ITA No.654 of 2005.

(J.S.Khehar) Judge (Nawab Singh) 6.2.2009 Judge AS

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