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Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI D.S. SUNDER SINGH
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER:
All the appeals of the Revenue are directed against the
common order passed by the Commissioner of Income Tax
(Appeals)-17, Chennai, dated 30.03.2016, for the assessment years
2010-11 to 2012-13. The assessee has also filed cross-objections
against the very same order of the CIT(Appeals). Therefore, we
2 I.T.A. Nos.2510 to 2512/Mds/16 C.O. Nos.155 to 157/Mds/16
heard both the appeals and cross-objections together and disposing
of the same by this common order.
The only issue arises in all the appeals of the Revenue is
with regard to claim of exemption under Section 11 of the Income-
tax Act, 1961 (in short 'the Act'). The Assessing Officer disallowed
the claim of the assessee for exemption under Section11 of the Act
on the ground that the assessee has collected subscription fee
annually and also collected life membership fee. The Assessing
Officer also found that the activities of the assessee are commercial
in nature, hence, proviso to Section 2(15) of the Act would come
into operation. This issue was examined by this Tribunal in the
assessee's own case for the assessment year 2009-10 in I.T.A.
No.712/Mds/2014 dated 14.01.2016. In fact, the CIT(Appeals), after
reproducing the order of this Tribunal for the assessment year 2009-
10, allowed the claim of the assessee under Section 11 of the Act.
This Tribunal has taken a similar view in the case of Tamil Nadu
Cricket Association v. DIT(E) 42 ITR(Trib) 546. In view of the
above, this Tribunal do not find any reason to interfere with the
order of the lower authority and accordingly the same is confirmed.
3 I.T.A. Nos.2510 to 2512/Mds/16 C.O. Nos.155 to 157/Mds/16
The cross-objections of the assessee is only in respect of
depreciation on the assets and the cost of which was allowed as
application of income under Section 11 of the Act. In fact, this was
also elaborately examined by this Tribunal in the case of Tamil
Nadu Cricket Association (supra) and observed at para 12 of its
order as follows:-
“12. Apart from that, when the assessee claims the cost of the capital expenditure as exemption under Section 11 of the Act, then the cost of the capital asset becomes NIL. Admittedly, depreciation under Section 32 of the Act has to be allowed only on written down value of the asset. When the written down value of the asset becomes NIL since the entire cost was allowed as application of income under Section 11 of the Act, this Tribunal is of the considered opinion that there cannot be any further claim for deduction under Section 32 of the Act. In view of the above, this Tribunal is of the considered opinion that the assessee is not eligible for deduction under Section 32 of the Act towards depreciation. However, it is made clear that the assessee is eligible for exemption under Section 11 of the Act for all the assessment years under consideration.”
A similar view was also taken by this Tribunal in the case of
Music Academy Madras v. DDIT(E) in I.T.A. No. 1098/Mds/2015
dated 22/4/2016. Since exemption under Section 11 of the Act falls
under Chapter III of the Act, the same would override the provisions
of Section 32 which falls under Chapter IV of the Act. In view of the
4 I.T.A. Nos.2510 to 2512/Mds/16 C.O. Nos.155 to 157/Mds/16
above, this Tribunal do not find any reason to interfere with the order of the lower authority and accordingly the same is confirmed.
In the result, both, the appeals of the Revenue as well as the cross-objections of the assessee are dismissed.
Order pronounced on 13th April, 2017 at Chennai.
sd/- sd/- (�ड.एस. सु�दर �संह) (एन.आर.एस. गणेशन) (D.S. Sunder Singh) (N.R.S. Ganesan) लेखा सद�य/Accountant Member �या�यक सद�य/Judicial Member
चे�नई/Chennai, �दनांक/Dated, the 13th April, 2017.
Kri. आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��यथ�/Respondent 3. आयकर आयु�त (अपील)/CIT(A)-17, Chennai-34 4. आयकर आयु�त/CIT (Exemptions), Chennai 5. �वभागीय ��त�न�ध/DR 6. गाड� फाईल/GF.