Commissioner Of Income Tax, Hisar v. Market Committee, Barwala

ITA No. 754 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH Commissioner of Income Tax, Hisar Versus Market Committee, Barwala ITA No. 754 of 2010 (O&M)Date of Decision: 7.1.2011 ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. ADARSH KUMAR GOEL, J. 1.Delay in refiling condoned. 2.This appeal has been preferred by the revenue underSection 260A of the Income Tax Act, 1961 against order dated30.4.2009 passed by the Income Tax Appellate Tribunal, Delhi Bench“E”, New Delhi, in ITA No. 1122/Del/08 for the assessment year 2004-05, claiming following substantial questions of law:- “(i)Whether on the facts and in the circumstances of thecase, the learned CIT(A) was justified in allowingpayment of 30% of Market fees earned by it paid toHaryana Agricultural Marketing Board as applicationof income for charitable purpose, despite the findingthat 30% of the market fee has to be paid to the said Board as a statutory obligation under the AgriculturalMarketing Board Act, and, therefore, it is notapplication of income, but it is sharing of Income byan overriding title as per the Act by which the MarketCommittee is governed? (ii) Whether on the facts and in the circumstances of thecase, the learned ITAT was justified in holding thatthe depreciation on fixed asset is allowable in thecase of charitable trust/institution particularly whenthe income is computed as per provisions of section11 to 13 of the Income-tax Act, 1961 and question ofdepreciation does not arise when capital expenditureis also considered as application of income of theassessee and there remains no assets/WDV forclaim of depreciation. The strength is drawn from theorder of the Hon'ble Supreme Court of India passedin the case of Escorts Ltd. & another Vs. Union ofIndia and others reported in 199 ITR 43 (108) CTR275 wherein it has been held that when deductionunder S. 35(2)(iv) is allowed in respect of capitalexpenditure on scientific research, no depreciation isallowed under S. 32 on the same asset. There is afundamental axiom that double deduction is notintended unless there is a clear statutory indication tothe contrary?” Learned counsel for the revenue very fairly states that ITA No. 754 of 2010 -3- question (i) is covered by the judgment of this Court dated 5.7.2010 in ITA NO. 151 of 2010 (Commissioner of Income Tax, Hisar v. MarketCommittee, Narwana) whereas question (ii) is covered by thejudgment of this Court dated 5.7.2010 in ITA No. 535 of 2009 (TheCommissioner of Income Tax, Karnal v. Market Committee, Pipli).4.Accordingly, the appeal is dismissed. (ADARSH KUMAR GOEL) JUDGE January 7, 2011gbs (AJAY KUMAR MITTAL)JUDGE