Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, DELHI BENCH: ‘C’: NEW DELHI
Before: SHRI SUDHANSHU SRIVASTAVA & SHRI ANADEE NATH MISSHRA
[A] This appeal has been filed by Revenue against the impugned appellate order dated 14.03.2016 passed by Learned Commissioner of Income Tax (Appeals)-36, New Delhi, [in short, “Ld.CIT(A)”] pertaining to Assessment Year 2010-11, on the following grounds:
“1. On the facts and circumstances of and in law, Ld. CIT(A) has erred in law in allowing the appeal of the assessee ignoring the fact that the activities of the assessee is in the nature of trade, commerce or business or any activity Page 1 of 23 ITA No.- 3237/Del/2016. National Association of Software and Services Companies of rendering any service in relation to any trade, commerce or business for cess or fee or any other consideration, irrespective of the nature of use or application, or retention of the income from such activities. The assessee falls in the last category of general public utility as per the definition of Sec. 2(15) of I.T. Act 1961 and not entitled to carry on any business or commercial activity.
On the facts and circumstances of the case and in law, Ld. CIT(A) has erred in law in allowing the appeal of the assessee ignoring the fact that assessee charges subscription fee on the basis of turnover from the members and voting right is as per subscription of fees. So, the voting right to members is actually based on the turnover, which is violating of the principle of mutuality.
The appellant craves leave to add, to alter or amend any ground of appeal raised above at the time of hearing.”
[B] Assessment Order dated 18.03.2013 was passed by the Assessing Officer (“AO”, for short) under Section 143(3) of the Income Tax Act, 1961 (“I.T. Act”, for short) wherein the total income was assessed at Rs. 12,14,81,569/- against returned income at Nil. The addition of returned income of assessee was made by the AO based on his conclusion that exemption under Section 11 & 12 of I.T. Act was to be denied to the assessee and that the assessee society was to be assessed as normal AOP (Association of Person). The relevant portion of the Assessment Order dated 18.03.2013 is reproduced as under:
ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies
”
[C] Aggrieved, the assessee filed appeal before the Ld. CIT(A). Vide impugned appellate order dated 14.03.2016, the Ld. CIT(A), following the order of the Ld. CIT(A) for the assessment Year (A.Y. 2009-10) allowed the assessee’s appeal holding that: “… the membership fees received by the assessee from its own members comes within the meaning of principle of mutuality and as such the net income of the assessee from its own member is exempt from tax.” The relevant portion of the order of Ld. CIT(A) is reproduced as under:
ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies
”
[C.1] The present appeal has been filed by Revenue against the impugned appellate order dated 14.03.2016 of the Ld. CIT(A). At the time of hearing before us, the Ld. AR of the Assessee submitted at the outset that the issue in dispute in the present appeal is squarely covered in favour of the assessee, by the orders of the Co-ordinate Bench of ITAT, Delhi in assessee’s own case; vide order dated 20.09.2019 in for Assessment Year 2009-10 and order dated 05.11.2019 in ITA No. 5738/Del/2016 for Assessment Year 2012-13. The Leaned Departmental Representative (“Ld. DR”, for short) agreed that the issue in dispute in the present appeal is squarely covered in favour of the assessee, vide the aforesaid orders dated 20.09.2019 and 05.11.2019 of co-ordinate Bench of ITAT, Delhi. Neither side has brought any distinguishing facts and circumstances to our attention to persuade us to take a view
ITA No.- 3237/Del/2016. National Association of Software and Services Companies different from view already taken by the Co-ordinate Bench of ITAT, Delhi by aforesaid order dated 20.09.2019 and 05.11.2019; and both sides were in agreement at the time of hearing before us, that facts and circumstances for this year (A.Y. 2010-11) and identical to facts and circumstances of Assessment Year 2009-10 and Assessment Year 2012-13 to which aforesaid orders dated 20.09.2019 and 05.11.2019 of Co-ordinate Bench of ITAT, Delhi correspond.
[D] We have heard both sides. We have perused the materials available on record.
We find that the Ld. CIT(A) has followed the decision of her predecessor in Assessment Year 2009-10. For Assessment Year 2009-10, Co-ordinate Bench of ITAT, Delhi has already taken a view in aforesaid order dated 20.09.2019 in in favour of the assessee. The relevant portion of the aforesaid order dated 20.09.2019 of Co-ordinate Bench of ITAT, Delhi for Assessment Year 2009-10 in ITA No. 6521/Del/2013 is reproduced as under:
ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies ITA No.- 3237/Del/2016. National Association of Software and Services Companies
”
ITA No.- 3237/Del/2016. National Association of Software and Services Companies [D.1] For Assessment Year 2012-13 also, Co-ordinate Bench of ITAT, Delhi has once again decided the issue in dispute in favour of the assessee, by following the aforesaid order dated 20.09.2019 of Co-ordinate Bench of ITAT, Delhi for Assessment Year 2009-
The relevant portion of the order dated 5.11.2019 of Co-ordinate Bench of ITAT, Delhi for Assessment year 2012-13 in is reproduced as under:
ITA No.- 3237/Del/2016. National Association of Software and Services Companies
ITA No.- 3237/Del/2016. National Association of Software and Services Companies
”
[D.2] It is not in dispute that the facts and circumstances for this year are identical to facts and circumstances for Assessment Years 2009-10 to 2012-13 for which vide aforesaid orders dated 20.09.2019 and 05.11.2019, Co-ordinate Bench of ITAT, Delhi has already decided the issue in favour of the assessee. Respectfully following the aforesaid orders dated 20.09.2019 and 05.11.2019 of Co-ordinate Bench of ITAT, Delhi in assessee’s own case, for Assessment Years 2009-10 and 2012-13; we also decide the issue in dispute before us in favour of the assessee. Accordingly, we decline to interfere
ITA No.- 3237/Del/2016. National Association of Software and Services Companies with the aforesaid impugned appellate order dated 14.03.2016 of Ld. CIT(A).
Resultantly, this appeal filed by Revenue is dismissed. [E] In the result, appeal of Revenue is dismissed. Order pronounced in the open court on 09/01/20.