The Commissioner Of Income Tax v. Market Committee, Bapoli

IN THE HIGH COURT OF PUNJAB AND HARYANA ATCHANDIGARH. I.T.A. No.285 of 2010 & other connected cases beingITA Nos.286 to 288 of 2010Date of decision: 2.8.2010 The Commissioner of Income Tax. Vs. Market Committee, Bapoli. -----Appellant. -----Respondent CORAM:- HON'BLE MR. JUSTICE ADARSH KUMAR GOELHON'BLE MR. JUSTICE AJAY KUMAR MITTAL Present:-Mr. Yogesh Putney, Sr. Standing counselfor the Revenue. --- ADARSH KUMAR GOEL, J. 1. This order will dispose of I.T.A. Nos.285 to 288 of2010, as it is stated that identical questions are involved in all the appeals. 2. I.T.A. No.285 of 2010 has been preferred by theRevenue under Section 260-A of the Income Tax Act, 1961against the order dated 29.5.2009 in I.T.A. No.3655/Del/2008passed by the Income Tax Appellate Tribunal, Delhi Bench ‘F’,New Delhi for the assessment year 2006-07, proposing to raisefollowing substantial questions of law:- “i) Whether on the facts, and in the circumstances ofthe case, the Income-Tax Appellate Tribunal wasjustified in holding that depreciation was allowablethe case, the Income-Tax Appellate Tribunal wasjustified in holding that depreciation was allowable on the capital asset, when deduction for capitalexpenditure incurred for acquisition of these capitalassets has already been allowed as application ofincome of the trust? ii) Whether on the facts, and in the circumstances ofthe case, the Income Tax Appellate Tribunal wasjustified in allowing double deduction on depreciationwhen capital expenditure on the asset has alreadybeen allowed is justified in the light of the apexCourt's decision in Escorts Ltd. Vs. UOI (199 ITR43) to the effect that in the absence of clear statutoryindication to the contrary, the statute should not beread as to permit an assessee two deductions onthe same expenditure?the case, the Income Tax Appellate Tribunal wasjustified in allowing double deduction on depreciationwhen capital expenditure on the asset has alreadybeen allowed is justified in the light of the apexCourt's decision in Escorts Ltd. Vs. UOI (199 ITR43) to the effect that in the absence of clear statutoryindication to the contrary, the statute should not beread as to permit an assessee two deductions onthe same expenditure? iii) Whether on the facts and in the circumstances ofthe case, the Ld. ITAT was justified in restoring theissue to the file of the Assessing Officer to allow setoff of brought forward unabsorbed depreciation andlosses of earlier years, despite the fact thatdepreciation per se is not allowable on capital assetswhen deduction for capital expenditure has alreadybeen allowed as application of income in earlieryears and when the provisions of sections 70 to 80of the Income-tax Act have not specifically providedfor carry forward and set off of losses or unabsorbeddepreciation in the case of income assessed u/s 11to 13 of the Act?the case, the Ld. ITAT was justified in restoring theissue to the file of the Assessing Officer to allow setoff of brought forward unabsorbed depreciation andlosses of earlier years, despite the fact thatdepreciation per se is not allowable on capital assetswhen deduction for capital expenditure has alreadybeen allowed as application of income in earlieryears and when the provisions of sections 70 to 80of the Income-tax Act have not specifically providedfor carry forward and set off of losses or unabsorbeddepreciation in the case of income assessed u/s 11to 13 of the Act? iv) Whether on the facts and in the circumstances ofthe case, the Ld. ITAT was justified in directing theAO to consider the excess amount of application ofincome of previous years to be adjusted in thecurrent year, despite there being no provision inSection 11 to 13 of the Act in this regard and despitethe fact that the ratio of the decision of the Hon'ble Rajasthan High Court in Maharana of MewarCharitable Foundation (164 ITR 439) is notapplicable to this jurisdiction? iv) Whether on the facts and in the circumstances ofthe case, the Ld. ITAT was justified in directing theAO to consider the excess amount of application ofincome of previous years to be adjusted in thecurrent year, despite there being no provision inSection 11 to 13 of the Act in this regard and despitethe fact that the ratio of the decision of the Hon'ble Rajasthan High Court in Maharana of MewarCharitable Foundation (164 ITR 439) is notapplicable to this jurisdiction? v) Whether on the facts and in the circumstances ofthe case, the Ld. ITAT was justified in allowingpayment of 30% of market fees earned by it paid tothe Haryana Agriculture Marketing Board asapplication of income for charitable purpose, despitethe finding that 30% of the market fee has to be paidto the said Board as a statutory obligation under theAgricultural Marketing Board Act, and therefore, it isnot application of income, but it is sharing of incomeby an overriding title as per the Act by which theMarket Committee is governed?”the case, the Ld. ITAT was justified in allowingpayment of 30% of market fees earned by it paid tothe Haryana Agriculture Marketing Board asapplication of income for charitable purpose, despitethe finding that 30% of the market fee has to be paidto the said Board as a statutory obligation under theAgricultural Marketing Board Act, and therefore, it isnot application of income, but it is sharing of incomeby an overriding title as per the Act by which theMarket Committee is governed?” 3. Learned counsel for the revenue fairly states that thematter is covered against the revenue by order of this Court dated28.7.2010 in I.T.A. No.238 of 2010 (The Commissioner ofIncome Taxv. Market Committee, Karnal). 4. In view of above, these appeals are dismissed. 5. A photocopy of this order be placed on the files ofeach connected caseeach connected case (ADARSH KUMAR GOEL) JUDGE August 02, 2010MITTAL )ashwani ( AJAY KUMAR JUDGE