TaxTMI 
TaxTMI 
TaxTMI 
2020 (11) TMI 400
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....ct 1961 (in short the act) on the basis of reasons recorded on 30.03.2016 by issue of notice under section 148 of the Act on 31.03.2016 and was duly served on the assessee. In response, the assessee vide letter dated 20.04.2016 submitted that the reopening of the assessment is bad in law and requested to provide a copy of the reasons recorded for reopening of the assessment. The assessing officer vide notice under section 142 (1) dated 20.06.2016, supplied reasons for reopening to the assessee. In the reasons, assessing officer observed that the proviso to section 2(15) of the Act was amended in Finance Act 2008 and on perusal of the records, it is observed that assessee is engaged in the activity of upgrading the local indigenous low milk yielding cattle by crossbreeding them with the use of frozen semen of high pedicree exotic bull of the technique of artificial insemination to get resulting better milk yield and will help in improving the socio economic status of the farmers. He further observed that the assessee interest is doing regular activities which are in the nature of business by way of sale of milk and therefore such activity of the assessee trust cannot be treated as c....
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.... 6. On the other hand, Ld CIT(A) allowed the grounds raised by the assessee on merit by relying on the case of Honourable Gujarat High Court in the case of Sabarmati Ashram Gaushala Trust and decision of the coordinate bench of this Tribunal in assessee's own case. 7. Aggrieved with the above order both assessee as well as revenue is in appeal raising various grounds of appeal. The assessee has filed this appeal objecting the dismissal of their grounds of appeal on reopening of the assessment whereas the revenue is in appeal against the order of the Ld CIT(A) allowing the grounds on merits of the case by treating the receipts of the trust as allowable under section 11 and 12 of the Act. 8. At the time of hearing, Ld. AR submitted that the assessment for this assessment year reopened by relying on the same information and documents which were submitted during the original assessment which was completed on 12.10.2011 under section 143(3) of the Act. No new evidence with the assessing officer in order to initiate reassessment proceedings. He submitted that the main object of the trust is to upgrade the local indigenous milk yielding cattle by cross breeding them with the use of froz....
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....tes that assessing officer has changed his opinion and reviewed the exemptions granted in the original assessment under section 11 of the Act. 10. In the intervening period, he brought to our notice the status of assessment for the assessment year 2010-11 and brought to our notice page 211, which is assessment order under section 143 (3) of the Act for assessment year 2010-11, the assessing officer passed the order on 19.12.2012 in which the assessing officer discusses the issue of amended proviso to section 2 (15) of the Act and assessee has submitted its detailed written response and after considering detailed response of the assessee, assessing officer gave a clear finding that the amended proviso to section 2(15) of the Act is not applicable in the case of the assessee. Further, he brought to our notice the status of assessment year 2011-12 and assessment year 2012-13 in which the assessing officer allowed the deduction under section 11 of the Act and he submitted that in the present assessment year, the assessing officer has not followed the principle of consistency. 11. Ld. AR submitted that the reassessment was completed by AO by using the information which is already in t....
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.... reopening of the assessment adopted by the assessing officer as far as recording of reasons and following the procedures in order to reopen the same. However, in order to reopen the assessment the assessing officer needs to have a cogent material in order to form opinion that the income has escaped assessment. In the given case assessing officer has recorded the reasons and the supplied the same to the assessee which is placed on record. From the reasons, recorded we noticed that the reasons for reopening was recorded "as that on perusal of records, it is observed that assessee is engaged in doing regular activities which are in the nature of business by way of sale of milk and therefore such activity of the assessee trust cannot be treated as charitable in nature". It is further recorded by the assessing officer that it is further seen that trust is engaged in certain activities which are commercial in nature therefore it has resulted in understatement of income accordingly in order to arrive at the real income of the assessee the assessment was reopened by issue of notice under section 148 of the Act. After considering the submissions of the assessee, the assessing officer has n....
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....onsidered view, the initiation of the reassessment proceedings with the wrong understanding of the assessing officer that the income of the assessee is out of sale of milk and other activities which are in commercial in nature. Since there is no change in the activities carried on by the assessee and also the assessing officer has accepted the activities carried on by the assessee that it is only improving the quality of the breeds of cow for yielding the milk and assessee is not selling or dealing in milk and revisited the assessment records without any new material to reopen the assessment as well as he reopened the assessment after 4 years without bringing on record any mistake on the part of the assessee to disclose fully and truly, all the information to complete the assessment. Ld AO and Ld CIT(A) has applied certain case laws which are distinguishable on facts to the present case. Since the revenue has accepted the activities of the assessee are not hit by the amended proviso to section 2 (15) of the Act in the subsequent assessment years and we presume that the then assessing officer in the original assessment passed under section 143 (3) must have verified and formed an op....
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....best pedigreed bulls and to castrate the scrub bulls and propagate the work to prepare bullocks by castrating the bulls which do not become good bulls. 2. To produce and to sell the cow milk and its various preparations so as to popularize the use of cow milk and do all other works for the same. 3. To hold and cultivate or get cultivated agricultural lands, to keep grazing lands etc necessary or desirable for cattle keeping and breeding or to rehabilitate and assist Rabaris and Bharwads. 4. To hold and cultivate other land also in order to experiment in the improvement in agriculture and obtain finance support in all the activities of the institution. 5. To make necessary arrangements for getting informatics and scientific knowledge and to do scientific research with regard to keeping and breeding of the cattle, agriculture, use of milk and its various preparations etc and to establish scientific laboratories, libraries, reading rooms relating to the keeping of the cattle, improvement of agriculture etc and recognize or assist such institutions. 6. To establish other allied institutions like leather work etc and to recognize and help them in order to make the cow keeping ....
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....d squarely fall under section 2 (15) of the Act. Profit making was neither the aim nor object of the Trust. It was not the principal activity. Merely because while carrying out the activities for the purpose of achieving the objects of the Trust, certain incidental surpluses were generated, would not render the activity in the nature of trade, commerce or business. As clarified by the CBDT in its Circular No. 11/2008 dated 19th December 2008 the proviso aims to attract those activities which are truly in the nature of trade, commerce or business but are carried out under the guise of activities in the nature of public utility'. 13. Delhi High Court in case of Institute of Chartered Accountants of India v. DGIT [2012] 347 ITR 99/[20111.202 Taxman 1/13 taxmann.Com 175 considered these very provisions in the context of activities of the Institute of Chartered Accountants holding that the fundamental or dominant function of the Institute was to exercise overall control and regulate the activities of the members/enrolled chartered accountants and merely because the Institute was holding coaching classes which also generate income, the Court held that proviso to Section 2 (.15) of ....
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.... this Tribunal in the case of JSW Ltd in ITA Nos. 6264 & 6103/Mum/2018 dated 14.5.2020, wherein this issue has been addressed in detail allowing time to pronounce the order beyond 90 days from the date of conclusion of hearing by excluding the days for which the lockdown announced by the Government was in force. The relevant observations of this tribunal in the said binding precedent are as under:- 7. However, before we part with the matter, we must deal with one procedural issue as well. While hearing of these appeals was concluded on 7th January 2020, this order thereon is being pronounced today on 14th day of May, 2020, much after the expiry of 90 days from the date of conclusion of hearing. We are also alive to the fact that rule 34(5) of the Income Tax Appellate Tribunal Rules 1963, which deals with pronouncement of orders, provides as follows: (5) The pronouncement may be in any of the following manners:- (a) The Bench may pronounce the order immediately upon the conclusion of The hearing. (b) In case where the order is not pronounced immediately on the conclusion of the hearing, the Bench shall give a date for pronouncement. (c ) In a case where no date of pronounc....
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....rmal nationwide lockdown, the functioning of the Income Tax Appellate Tribunal at Mumbai was severely restricted on account of lockdown by the Maharashtra Government, and on account of strict enforcement of health advisories with a view of checking spread of Covid 19. The epidemic situation in Mumbai being grave, there was not much of a relaxation in subsequent lockdowns also. In any case, there was unprecedented disruption of judicial wok all over the country. As a matter of fact, it has been such an unprecedented situation, causing disruption in the functioning of judicial machinery, that Hon'ble Supreme Court of India, in an unprecedented order in the history of India and vide order dated 6.5.2020 read with order dated 23.3.2020, extended the limitation to exclude not only this lockdown period but also a few more days prior to, and after, the lockdown by observing that "In case the limitationhas expired after 15.03.2020 then the period from 15.03.2020 till the date on which the lockdown is lifted in the jurisdictional area where the dispute lies or where the cause of action arises shall be extended for a period of 15 days after the lifting of lockdown". Hon'ble Bombay High Court....