The Kallakuruchi Agricultural Producer Co-Operative Marketing Society Ltd v. The Assistant Commissioner Of Income Tax,Circle Ii,S.n. Chavadi

IN THE HIGH COURT OF JUDICATURE AT Chennai DATED: 19.03.2021 CORAM THE HON'BLE MR.JUSTICE M. DURAISWAMYANDTHE HON'BLE MRS.JUSTICE T.V. THAMILSELVI Tax Case Appeal Nos. 562 & 563 of 2010 The Kallakuruchi Agricultural Producer Co-operative Marketing Society Ltd.,5, Nephal Street,Kallakurichi - 606 202 ... Appellant in both TCAs vs. The Assistant Commissioner of Income Tax,Circle II,S.N. Chavadi, Cuddalore - 607 202. ... Respondent in both TCAs Tax Case Appeals preferred under Section 260A of the IncomeTax Act, 1961, against the common order of the Income TaxAppellate Tribunal, Chennai, ''B'' Bench, dated 30.10.2009passed in I.T.A.Nos.708 & 709/Mds/2009 for the AssessmentYears 2001-02 and 2004-05 made against the orders ofCommissioner of Income Tax, Pondicherry both dated 09.03.2009 inC.No.91274 (5) CIT/PDY/2008-09, for Assessment year 2001-02 and2004-05, against the order of Assistant Commissioner of IncomeTax Circle-II, Cuddalore in PAN/GIR No. 21603-K dated22.12.2006, for the Assessment year 2001-02 and 2004-05. For Appellant : Mr.V.S. JayakumarFor Respondent : Mr.J.Narayanasamy Senior Standing Counsel JUDGMENT (Judgment was Delivered by M. DURAISWAMY, J) Challenging the common order dated 30.10.2009 passed inI.T.A.Nos.708 & 709/Mds/2009 in respect of the Assessment https://hcservices.ecourts.gov.in/hcservices/ Years 2001-02 and 2004-05 on the file of the Income TaxAppellate Tribunal, Chennai, ''B'' Bench (for brevity, theTribunal), the assessee has filed the above appeals. 2. The above appeals were admitted on the followingsubstantial questions of law: " (i) Whether the Tribunal was right inholding that \ the Commissioner of Income Tax hadcorrectly invoked Section 263 of the Income tax Actwithout giving any finding that the said order didnot fulfil the conditions laid down in the eh saidsection? (ii) Whether the Tribunal was right in law inholding that the provisions of Section .14 A areapplicable to cases covered under chapter VI A asaccording to the Tribunal the issue of deductionunder section 80 P is totally independent from theissue of disallowance of expenditure under section14 A of the Income Tax Act? " 3. The Income Tax Appellate Tribunal while dismissing theappeals filed by the assessee observed that the Commissionerof Income Tax has made an observation regarding disallowanceof the expenses relating to non-members, the same is only anindependent and passing remark of the Commissioner of IncomeTax having no bearing on the conclusion arrived by theCommissioner of Income Tax with respect to the issue involved inthe show cause notice. Further, the Tribunal observed thatthere is no merit or substance in the contention of theassessee when the issue of disallowance of expenditure undersection 14A has already been settled by the Tribunal for theassessment year 2002-03 and in such case, the Commissioner ofIncome Tax cannot pass a revision order under section 263on the same issue. Further, the Tribunal held that the issue ofdeduction under section 80P is totally independent from theissue of disallowance of expenditure under section 14A and theAssessing Officer has neither made any enquiry nor appliedhis mind on the issue of 80P. Observing so, the Tribunal foundno error in the order passed by the Commissioner of Income Taxunder section 263 of the Income Tax Act. 4. Mr.V.S. Jayakumar, learned counsel appearing for theappellant submitted that the Tribunal had already decided theissue with regard to Section 14 A in respect of the appellant-assessee pertaining to the assessment year 2002-03 in theirfavour and therefore, the authorities cannot take a contrarystand in respect of the other assessment years, which areimpugned in the above appeals. 4. Mr.V.S. Jayakumar, learned counsel appearing for theappellant submitted that the Tribunal had already decided theissue with regard to Section 14 A in respect of the appellant-assessee pertaining to the assessment year 2002-03 in theirfavour and therefore, the authorities cannot take a contrarystand in respect of the other assessment years, which areimpugned in the above appeals. 5. Mr.J.Narayanasamy, learned Senior Standing Counselappearing for the respondent submitted that since theTribunal had already decided, the issue with regard to Section14 A in favour of the assessee in respect of the assessmentyear 2002-03 in I.T.A. No.2198/Mds/2005, the Assessing Officermay be directed to give effect to the impugned orders passed bythe Tribunal taking into consideration the earlier order passedby the Tribunal for the Assessment Year 2002-03, dated31.01.2008 and decide the matter in accordance with law. 6. Mr.V.S. Jayakumar, learned counsel appearing for theappellant submitted that the Assessing Officer may be directedto complete the exercise by giving effect to the impugned orderpassed by the Tribunal after taking into consideration theearlier order passed by the Tribunal in respect of theAssessment Year 2002-03. 7. Having regard to the submissions made by the learnedcounsel on either side, since the Tribunal had already decidedthe issue with regard to Section 14 A in favour of the assesseein respect of the assessment year 2002-03 in I.T.A.No.2198/Mds/2005, we direct the Assessing Officer to giveeffect to the impugned orders passed by the Tribunal taking intoconsideration the earlier order passed by the Tribunal for theAssessment Year 2002-03, dated 31.01.2008 and decide the matterin accordance with law. So far as the first question of lawis concerned, we are leaving it open and the same would bedecided in an appropriate case. With these observations, both the Tax Case Appeals aredisposed of. No costs. Sd/-Assistant Registrar(CS VII) //True Copy// Sub Assistant Registrar RJTo 1. The Income Tax Appellate Tribunal, Chennai ''B''Bench, Chennai.2. The Assistant Commissioner of Income Tax, Circle II, S.N. Chavadi, Cuddalore - 607 202.3. The Commissioner of Income Tax, Pondicherry.+1cc to Mr.V.S.Jayakumar, Advocate, S.R.No.17818Tax Case Appeal Nos.562 & 563 of 2010 AK-II(CO)TE (30/04/2021)