TaxTMI 
TaxTMI 
2025 (1) TMI 1577
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....come and Expenditure account. 3. The ld. CIT (A) has erred in law and facts in deleting the depreciation of Rs. 43,17,034/- made by the AO while capital expenditure on fixed assets have been allowed in respective years. 4. The order of ld. CIT (A) be cancelled and the order of the AO be restored." 4. The first and foremost issue which arises between the parties herein is that of the Revenue's endeavour to treat the assessee as covered u/s 2(15) 1st proviso of the Act since carrying out it's activities which are allegedly commercial in nature. It quotes hon'ble apex court recent decision in ACIT (Exemptions) Vs. Ahmedabad Urban Development Authority and Ors. (2022) 449 ITR 1 (SC) that even their lordships have agreed with the departmental stand that such an assessee could not be treated as eligible for claiming both registration u/s 12A as well as u/s 11 exemption; as the case may be, in the given facts. 5. Learned counsel representing assessee on the other hand has highlighted the fact that the Revenue's instant first and foremost substantive ground is infact a recurring issue between the parties which travelled upto hon'ble apex court in the very decis....
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....unt of a G. O. No. 152/9A-1998 dated 15.01.1998. The same was placed before the Assessing Officer but didn't care by him. The proper test to be applied in such a case has been laid down by Supreme Court in CIT V. Sitaldas Tirathnath (1961) 41 ITR 367 and the present case is one where accrual to discharge an obligation of the assessee. The entire income earned during the year under consideration was not the income of the assessee and was merely applied by the managing State Government funds for the payment to the other bodies. Now applying the obligation the assessee has only credited such sums to those to whom it were due to him. He didn't carry the amounts received on other behalf to Profit & Loss account and taken to Balance Sheet as capitalization. The other way was to show other authorities as creditors. Moreover this was the first drafted profit & Loss Account and Balance Sheet as the Authority was exempted U/s 10(22). So it was merely a placing of the amounts in statement of accounts. Rs. 19,64,52,045/- has been added by The Leaned Officer on account of money taken by MDA as receipts on other behalf as revenue receipts without considering the amount dir....
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.... of the assessee-company. Consistency in Accounting Policies. Meerut Development Authority is a statutory authority of the State Government of Uttar Pradesh. There are specific accounting policies and procedures used by an authority to prepare its financial statements. These include the methods, measurement systems and procedures for presenting disclosures. The policies regarding recognition of expenditure, their allocation, sale point etc. are being following since long & being adopted and followed consistently. Sir your good-self in your Previous Year Appellate Order in the case of Same Appellant for the A/y 2011-12 & A/y 2012-13 stated that assessing officer either could not understand the true nature of accounts and transaction or in a prejudicial manner made the addition. When assessee authority has no control over the infrastructure fund and amount lying in infrastructure fund is to be spent in the manner to be directed by State Govt. Control over the account is of High Powered Committee under the Chairmanship of Divisional Commissioner. Amount to be spent under the control of High powered committee and through various agencies. Assessee authority a....
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....clear that there is no distinction in law or on facts forthcomings from the Revenue side. Faced with this situation, we adopt judicial consistency to uphold the CIT(A)'s action under challenge deleting the impugned addition. 8. Lastly comes depreciation disallowance issue of Rs. 43,17,034/- deleted in the lower appellate discussion reading as follows: "5.1 Decision and Reasons: I have considered the facts and case laws cited. It is correct that claiming of deprecation by charitable institutions are under dispute and challenged before different higher forums. W.e.f. 1.6.2015 an amendment has been made in section 11 by inserting the provision (6) of the Act. From A.Y. 2015-16 deprecation shall not be allowed is assessee has claimed the capital expenditure as application of income, but in the present appeal assessment year 2014-15 is involved, so amended provision cannot be made applicable. Deputy Director of Income-tax (Exemption) v. Bhardwaj Welfare Trust [2015] 59 taxmann.com 201 (Delhi - Trib.) it has been held:- "Section 32, read with section 11, of the Income-tax Act, 1961 - Depreciation -Allowance/rate of (Charitable trust, in case of....