The Commissioner Of Income Tax (Exemptions v. Surat Urban Development Authority (Suda

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 269 of 2020 ========================================================== THE COMMISSIONER OF INCOME TAX (EXEMPTIONS) VersusSURAT URBAN DEVELOPMENT AUTHORITY (SUDA) ========================================================== Appearance:MR MR BHATT, SR. ADVOCATE WITH MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE THE CHIEF JUSTICE MR. VIKRAM NATHandHONOURABLE MR. JUSTICE J.B.PARDIWALA Date : 30/09/2020 ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1This Tax Appeal is at the instance of the Revenue,being dissatisfied with the order passed by the Income TaxAppellate Tribunal, “D” Bench, Ahmedabad, in the ITANo.2429/Ahd/2017 for the A.Y.2009-10. 2The Revenue has proposed the followingsubstantial questions of law for the consideration of thisCourt: “[A]Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in holdingthat the re-assessment proceedings to be wrong and void abinitio whereas the proceedings for reassessment forreopening of assessment was validly on the basis ofinformation and after recording proper reason? [B] Whether on the facts and circumstances of the case and in law, the Hon’ble Tribunal was justified in holdingthat activities of the assessee are not in the nature ofcommerce/trade without considering the fact that theassessee is involved in widespread commercial activitieswhich is covered under first and second provisos to section2(15) of the Act without considering the merit of the issue? [C] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in consideringthe activity of the assessee as engaged in the developmentof urban area which is in the nature of advancement ofgeneral public utility not hit by the newly introduced firstand second proviso to section 2(15) of the Act withoutconsidering the merit of the issue? [D] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in deleting theaddition of Rs.2,51,276/- by not appreciating the fact thatthe addition to fixed assets has already been allowed inearlier years as application of income which amounts todouble deduction without considering the merit of the issue? [E] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in deleting theaddition of Rs.38,30,97,603/- on account of expenditure onhousing project considering that a capital expenditure by aperson need not to be a capital receipt of the personreceiving that amount which the assessee has received fordischarge of its objects without considering the merit of theissue? [F] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in deleting theaddition of General Development Expenditure Fund ofRs.7,25,19,123/- considering that a capital expenditure by aperson need not be a capital receipt of the person receivingthat amount which the assessee has received for thedischarge of its objects without considering the merit of theissue? [G] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified giving benefitin accumulation @15% of Rs.6,56,00,660/- u/s. 11(1)(a) ofthe Act without appreciating the fact that once the proviso ofsection 2(15) is applicable, the benefit of section 11(2) cannotbe allowed further without considering the merit of theissue? [H] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in allowingcarry forward of deficit of Rs.1,20,90,804/- against itsfuture income in absence of any express provision in the Actregarding the same without considering the merit of theissue? [G] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified giving benefitin accumulation @15% of Rs.6,56,00,660/- u/s. 11(1)(a) ofthe Act without appreciating the fact that once the proviso ofsection 2(15) is applicable, the benefit of section 11(2) cannotbe allowed further without considering the merit of theissue? [H] Whether on the facts and circumstances of the caseand in law, the Hon’ble Tribunal was justified in allowingcarry forward of deficit of Rs.1,20,90,804/- against itsfuture income in absence of any express provision in the Actregarding the same without considering the merit of theissue? 3We have heard Mr. M.R.Bhatt, the learned SeniorCounsel assisted by Mrs. Mauna Bhatt, the learned SeniorStanding Counsel appearing for the Revenue and haveperused the materials on record. The questions proposedby the Revenue are no longer res integra in view of the judgment of this very Court rendered in the Tax AppealNo.79 of 2020 dated 25.02.2020. All the questionsproposed are squarely covered by the decision rendered inthe case of Ahmedabad Urban Development Authority vs.ACIT (Exemption), 2017 396 ITR 323 (Guj.). 3In the result, the Appeal fails and is herebydismissed. (VIKRAM NATH, CJ) A. B. VAGHELA/P.SUBRAHMANYAM (J. B. PARDIWALA, J)