Commissioner Of Income Tax,Coimbatore v. M/S. Kongunadu Arts & Science College Council, Gnanambika Mills Post,Coimbatore - 641 029

IN THE HIGH COURT OF JUDICATURE AT MADRAS THE HON'BLE MR. JUSTICE M.DURAISWAMYAND THE HON'BLE MRS.JUSTICE R.HEMALATHA Commissioner of Income Tax,Coimbatore... Appellant v. M/s. Kongunadu Arts & Science College Council, Gnanambika Mills Post,Coimbatore - 641 029 ...Respondent Appeal preferred under Section 260A of the Income Tax Act,1961, against the order of the Income Tax Appellate Tribunal,Madras, "A" Bench, dated 14.02.2013 in I.T.A.No.1791/Mds/2012for the Assessment Year 2009-2010. As Against the order of thecommissioner of income tax (Appeals)-I, Coimbatore, dated19.07.2012 made in Appeal No.13/11-12. As Against the order ofthe Income tax officer, Ward-I, Coimbatore, dated 31/10/2011Under section 143(3) of the Income Tax Act for the assessmentyear 2009-2010. JUDGMENT (Judgment was delivered by M. DURAISWAMY, J.) Challenging the order passed in I.T.A.No.1791/Mds/2012 inrespect of the Assessment Year 2009-2010 on the file of theIncome Tax Appellate Tribunal, Chennai, "A" Bench (for brevity,the Tribunal), the Revenue has filed the above appeal. 2. The respondent-assessee is a Charitable Trust registeredunder section 12A of the Income Tax Act, 1961. The assesseefiled its return of income for the Assessment Year 2009-2010on 29.09.2009. The Assessing Officer issued a notice undersection 143(2) of the Act on 28.09.2010 and the oder under https://hcservices.ecourts.gov.in/hcservices/ section 143(3) of the Act ws passed on 31.10.2011. Inconcluding the assessment, the Assessing Officer inter alia heldthat the depreciation claimed by the assessee would not beallowable as a deduction in the computation of the fundsavailable for application by the assessee on the premise thatthe entire cost of the assets were allowed as an application ofthe funds in the year when the same were purchased. TheAssessing Officer also held that the provisions of section 11is distinct from that of section 14 and that the deductions andallowances that are provided in Chapter V cannot be applied indetermining the income for the purpose of section 11 of the Act.Aggrieved over the order passed by the Assessing Officer, theassessee preferred an appeal before the Commissioner of IncomeTax(Appeals), who allowed the appeal in favour of the assesseeand held that the depreciation is to be deducted in arriving atthe total income of the assessee. Aggrieved by the order ofCIT (Appeals), the Revenue filed an appeal before the IncomeTax Appellate Tribunal and the Tribunal, dismissed the appeal.Challenging the order passed by the Income Tax AppellateTribunal, the Revenue has filed the above appeal. 3. The above appeal was admitted on the followingsubstantial questions of law: “ (i) Whether in law and in the facts andcircumstances of the case, the Tribunal is rightin holding that depreciation is allowable asapplication of income on charitable objects? (ii) Whether on the facts and in thecircumstances of the case, the Tribunal wasright in holding that the assessee is entitledto claim depreciation on the assets, in the formof application of income, even though cost ofpurchase of asset was treated as application ofincome under section 11? (iii) Whether in law and in the facts and inthe circumstances of the case, the Tribunal isright in holding that allowing the depreciationclaim of the assessee would not result in doublededuction, though the entire costs of thedepreciable assets have already been allowed asas application of income towards objects of thetrust?" 3. When the appeal is taken up for hearing,Mr.J.Narayanasamy, learned Senior Standing Counsel appearing forthe appellant-revenue fairly submitted that the substantialquestions of law that are raised in the above appeal werealready decided by the Division Bench of this court in the https://hcservices.ecourts.gov.in/hcservices/ (iii) Whether in law and in the facts and inthe circumstances of the case, the Tribunal isright in holding that allowing the depreciationclaim of the assessee would not result in doublededuction, though the entire costs of thedepreciable assets have already been allowed asas application of income towards objects of thetrust?" 3. When the appeal is taken up for hearing,Mr.J.Narayanasamy, learned Senior Standing Counsel appearing forthe appellant-revenue fairly submitted that the substantialquestions of law that are raised in the above appeal werealready decided by the Division Bench of this court in the https://hcservices.ecourts.gov.in/hcservices/ Common Judgment in T.C.A.Nos.343 to 345 & 347 of 2014[Commissioner of Income Tax, Trichy Vs. M/s.National CollegeCouncil, Teppakulam, Tiruchirapalli – 620 002] wherein theDivision Bench held as follows:-" ................. 4.When the appeals were takenup for hearing, Mr.J.Narayanasamy, learned SeniorStanding Counsel appearing for the appellant – Revenuein all the appeals, fairly submitted that thesubstantial question of law, which has been framed inthese appeals, have been answered against the Revenueby the Hon'ble Supreme Court in CIT Vs. Rajasthan andGujarati Charitable Foundation reported in [2018] 402ITR 441 (SC). Further, the learned Senior StandingCounsel submitted that following the decision of theHon'ble Supreme Court, the Hon'ble Division Bench ofthis Court, by judgment dated 26.08.2019, made inT.C.A.Nos.680 & 681 of 2011 [Commissioner of Income Tax– I, Tiruchirapalli Vs. M/s.National College Council,P.B.No.369,ChatramBusStand,Teppakulam,Tiruchirapalli – 620 002] dismissed the appeals andanswered the substantial questions of law against theRevenue. The appeals in T.C.A.Nos.680 & 681 of 2011relates to the very same assessee. Hence, followingthe judgment of the Hon'ble Supreme Court reported in[2018] 402 ITR 441 (SC) and the judgment of theHon'ble Division Bench of this Court made inT.C.A.Nos.680 & 681 of 2011, the substantial question of law is answered against theRevenue and the appeals are dismissed. No costs. 5. Mr. P. Haribabu, learned counsel appearing for therespondent submitted that in view of the ratio laid down bythe Hon'ble Division Bench of this Court in T.C.A.Nos.343 to345 & 347 of 2014 [cited supra] the appeal may be dismissed. 6. Having regard to the submissions made by the learnedcounsel on either side, following the ratio laid down by theHon'ble Division Bench of this Court in in T.C.A.Nos.343 to 345& 347 of 2014 [cited supra] dated 26.02.2021 the questionsof law are answered against the Revenue and in favour of theassessee. The Tax Case Appeal is dismissed. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar RjTo 1.The Income Tax Appellate Tribunal, Chennai, "A" Bench. 2.The Commissioner of Income Tax (Appeals)-I,Coimbatore. 3.The Income Tax Officer, Ward-I,Coimbatore. +1cc to M/s.P.Haribabu, Advocate, S.R.No.32316/2021 GP(CO)SB(02/08/2021) T.C.A.No.189 of 2014