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Income Tax Appellate Tribunal, BANGALORE BENCH, ‘A’, BANGALORE
Before: SHRI INTURI RAMA RAOSHRI LALIET KUMAR
directed against the common order passed by the Commissioner of Income-tax (Appeals) – V, Bangalore dated 30/6/2008 for the asst. year 2005-06 and 27/2/2009 for the asst. years 2001-02, 2002-03, 2003-04 and 2006-07. Since common issues are involved in all these appeals, for the sake of convenience it is disposed of by this common order.
At the outset, the ld AR has drawn our attention to the order passed by the Tribunal in the whereby the appeal of the Revenue was dismissed by speaking order of the Tribunal with the following effect:
4. First we take up the Cross Objections of the assessee. The learned Authorised Representative of the assessee has submitted that the authorities below have denied the claim of exemption under Section 10(21) of the Act in view of the CBDT letter F. No.203/38/2006/ITA-II dt.28.8.2006. She has pointed out that the assessee challenged the Notification of the CBDT before the Hon'ble High Court in Writ Petition No.50838 & /56636 - 56637 / 2013(T-IT). The Hon'ble /B/08 & 379 – 382/B/09 3 High Court vide decision dt.26.11.2014 set aside Notification Dt.30.1.2004 dt.28.8.2006 and 24.5.2007. Accordingly, the assessee was directed to appear before the CBDT and explained the nature of activity being carried out by it which shall be taken into consideration by the authorities while considering the case of the assessee for exemption. In pursuant to the said decision of the Hon'ble High Court, the CBDT has now issued the Notification Dt.7.4.2016 whereby the assessee has been notified as scientific research association subject to the condition enumerated there & C.O. No.82/Bang/2014 under. Thus the learned Authorised Representative has submitted that since the CBDT has already issued a Notification dt.7.4.2016 notifying the assessee as scientific research association, therefore, the orders of the authorities below in denying the exemption under Section 10(21) are not sustainable and liable to be set aside.
5. On the other hand, the learned Departmental Representative has submitted that though the CBDT has issued the Notification in question however exemption under Section 10(21) however, the same can be allowed only on satisfaction of various conditions as listed in the said notification.
We have heard the rival submissions as well as considered the relevant material on record. We find that the Assessing Officer as well as CIT (Appeals) has denied the claim of exemption under Section 10(21) of the Act only on a limited ground of the Notification of the CBDT dt.28.8.2006. Relevant finding of the CIT (Appeals) are in para 4.5 as under : " The matter was referred to CBDT and the CBDT in the clarification given in F.No.203/38/2006/ITA-=II dated /B/08 & 379 – 382/B/09 4
28.08.2006 has held that the benefit of section 10(21) is available only to a "scientific research association" categorized as such under Section 35(1)(ii) and not an 'institution' and hence the appellant is, not eligible for the benefit of exemption & C.O. No.82/Bang/2014 u/s.10(21). CBDT directed A.O. to take remedial measure in this regard according to law." Neither the Assessing Officer nor the CIT (Appeals) has pointed out that the assessee has controverted the condition required for allowing the exemption under Section 10(21) of the Act. Even otherwise when the CIT (Appeals) has found that the assessee is eligible for deduction under Section 35(1)(ii) of the Act then the conditions as enumerated in the said notification are found to be satisfied for the purpose of Section 35(1)(ii) of the Act. Thus once the assessee is found to be eligible for deduction under Section 35(1)(ii) then the claim of exemption under Section 10(21) cannot be denied in view of the fact the CBDT has already notified the assessee in the category of 'Scientific Research Association' from Assessment Year 2003-04 onwards vide Notification dt.7.4.2016. In view of the above facts and circumstances of the case and the Notification dt.7.4.2016 issued by the CBDT, we allow the claim of the assessee under Section 10(21) of the Act.
It is submitted that by the notification issued by the CBDT on 7/4/2016 u/s 35(1)(ii) recognised the assessee as scientific Research Institution for the asst. Year 2003-04 onwards. It was submitted on behalf of the assessee that the facts of the present case are similar to /B/08 & 379 – 382/B/09 5 that of the earlier years, therefore, the appeal filed by the Revenue is required to be dismissed as the issue of eligibility of the assessee to claim exemption u/s 10(21) of the Act become infructuous in view of the CBDT Circular.
On the other hand, the ld DR relied upon the order passed by the authorities below.
We have heard the rival contention of the parties and perused the record, more particularly order passed by the Co-ordinate Bench in the assessee’s own case in ITA No.364/Bang/2014. In view of the notification issued by the Board w.e.f 7/4/2016, no issue is required to be adjudicated and, therefore, the appeals of the Revenue are required to be dismissed.
6. We may also like to point out that ld CIT(A) for the asst. year 200-02 and 2002-013 held that the assessee is eligible for exemption u/s 10(21) of the Act relying upon the notification of the Board Circular bearing No.ITA/ 341/Trust/CIT/2007-08 dated 30/6/2008. We find that the activity of the assessee continues to be same since the establishment /B/08 & 379 – 382/B/09 6 of the institute and there is no change in the activity of the assessee and, therefore, the assessee is eligible for deduction u/s 10(21) of the Act for the asst. Years 2001-02, 2002-03m 2003-04, 2005-06 and 2006-07.
In view thereof all the appeals of the Revenue are dismissed.
In the result, the appeal of the Revenue are dismissed.
Order pronounced in the open court on 5th May, 2017.