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2022 (12) TMI 1184
Principles of natural justice - service of SCN - impugned order assailed on the ground that it has been made without giving notice to the writ petitioner-dealer and without affording an opportunity of personal hearing - HELD THAT:- A comparison of the signatures in the postal acknowledgement card and writ affidavit/vakalatnama reveal even to the naked eye that they are completely different. Therefore, in the considered view of this Court, there is nothing before this Court to demonstrate that the writ petitioner was put on notice before making of the impugned order.
It is settled law that an impugned order cannot be improved by way of a counter affidavit or by production of records, more so in matters of this nature. Therefore, as the impugned order does not say that a personal hearing has been afforded, which is held to be statutorily imperative by this Court in STATE BANK OF INDIA OFFICER'S ASSOCIATION (CC) – SBIOA VERSUS THE ASSISTANT COMMISSIONER (ST) [2019 (9) TMI 698 - MADRAS HIGH COURT] case in a legal drill under Section 22(4) of erstwhile TNVAT Act, this Court is convinced that the impugned order deserves to be set aside on this ground.
Impugned order is set aside solely on the ground that personal hearing has not been afforded though the impugned order says that it is a legal drill under Section 22(4) of erstwhile TNVAT Act - Petition disposed off.
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2022 (12) TMI 1183
Assessment of tax - calculation and clubbing of turnover of two units - sister concern or independent entities - rejection of calculation on the ground that the Registration Certificate, which was applied for Sri Annapoorna Sweets, a sister concern of Tirupur Sree Annapoorna Hotel was not accepted for registration - HELD THAT:- A perusal of the assessment order unravels the fact that the dealer, namely, Tirupur Sree Annapoorna Hotel had, though, maintained separate accounts for sweet stall and hotel, there was no set up of detached kitchen and even both concerns were functioning in the same site. There was no proof adduced regarding disbursement of salary to the employees under different salary slips and on scrutiny of bills, it came to light that bills for common telephone expenditure and electricity charges were raised. Above all, there was a common cash counter for collection of sale amount in respect of both sweets and hotel. There is not even an iota of material evidence adduced to establish that Sree Annapoorna Sweet stall is the sister concern of the petitioner herein.
The act of the petitioner herein is an attempt to swindle exchequer's money by evading payment of tax and if the contention of the petitioner that Tirupur Sree Annapoorna Hotel and Sree Annapoorna Sweets are independent entities is accepted, then the term "sister concern" will become diluted and all the firms will adopt the same tactics of creation of one or more sister concerns under one umbrella with different names and claim the benefit of tax. In that event, it will defeat the real intention of the legislature.
The Assessing Authority, in support of his assessment by clubbing both units as one, had stated that based on the divulgence of the petitioner that Sree Annapoorna Sweet Stall got merged with Tirupur Sree Annapoorna Hotel with effect from 01.04.1997, common assessment was made by branding them as a single unit. Even prior to that, the petitioner was not in possession of valid registration certificate and therefore, it cannot be contended that the petitioner is entitled to the tax benefit for the previous year.
The petitioner herein deserves no leniency from this Court, as the Tribunal has rightly analyzed the evidence on record and restored the findings of the Original Authority. Since there is a finding of fact and no question of law is involved, we are of the view that there is no perversity in the findings of the Tribunal, warranting interference by this Court - Petition dismissed.
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2022 (12) TMI 1182
Refund of Excess ITR certified by the Auditor - Input Tax Rebate (ITR) - in the VAT Tax report, 75 mismatches were found - unverified ITR - Impugned order passed without application of mind without granting any justification - non issuance of show cause notice by Assessing Officer - Best judgment assessment under section20(5) of the VAT Act - non provision of report in Form 75-76 to Appellate containing details of turnover of Selling Dealers is denial of natural justice or not - failure by the Appellate Authorities to call remand report from the Assessing Officer regarding correct status and credentials of the selling dealers and merely confirming the rejection of ITR based on mismatch as per Form 75 is a correct procedure as per law - non- provision of reasons of reduction of ITR in the proceedings in assessment - increase in pecuniary liability.
HELD THAT:- Section 20 (1) of the M.P. VAT Act says that the assessment of every registered dealer shall be made separately every year. Sub-Section (4) of Section 20 provides that Commissioner shall serve on a registered dealer who is not eligible for assessment in the prescribed form, to appear in person or by an agent or to produce evidence or to produce accounts, registers, cash memoranda or other documents. Sub Section (b) provides that the Commissioner after hearing the registered dealer or his agent examined the evidence produced with requirement of section (2) and (3) of Clause (a), he may require shall assess or reassess to the tax. Therefore, proceedings under Section 20 (4) in respect of assess and re-assess is up to.
All the authorities/ Tribunal has rightly held that under proviso (6) (a) of Section 14 of the M.P. VAT Act if a registered dealer (Selling dealer) has furnished a return of a period, the tax in respect of purchase made from the registered dealer, the selling dealer ordinarily deem to have been paid for the purpose subsection unless it is found otherwise. VAT Tax report has disclosed that certain entries are not matching with the return of the selling dealer, therefore, the appellant was called upon under Section 20(5). Then under Section 15, the burden of proving that any sale or purchase effected by a dealer is not liable to tax under Section 9 or Section 10 as the case may be, or that he is eligible for an input tax rebate under Section 14 shall be on the dealer, therefore, the burden was on the appellant to satisfy that the Input Tax Rebate for which he claimed the rebate was duly paid by the selling dealer before the sale of the goods. The authorities have recorded the satisfaction that those selling dealers did not show these sales to the appellant in their VAT Tax Return.
So far as the contention of the learned counsel of the appellant is that no details of the disputed sale were given to the appellant by the Assessment Officer is concerned all the purchases were in the knowledge of the appellant on which he claimed input tax rebate and appellant was called to produce all the details of sale and purchase for that relevant year and after examining all the record, the authorities have recorded its satisfaction that, the appellant is not liable to be given a rebate of Rs.15,44,226/-. The concurrent findings of the three authorities are not liable to interfered as we do not find any substantial questions of law involved in this appeal.
Appeal dismissed.
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2022 (12) TMI 1181
Attachment of bank account of petitioner - recovery of outstanding taxes of a Company from the accounts of its individual Directors - HELD THAT:- Admittedly, the assessment in the present case is in the name of the Company and throughout, it is the Company which has been treated as the Assessee and demands raised against it. While the impugned order notices that there is nothing wrong in the attachment of the Company’s account, the grievance of the Petitioner that as an individual Director who has already resigned much prior to the impugned attachment, his individual account could not have been attached was not even addressed in the impugned order.
Section 51 of the OVAT Act read with Rule 55 of the OVAT Rules provides a special mode of recovery of outstanding amount of tax, interest and penalty. Even these provisions do not authorize recovery of outstanding taxes of a Company from the accounts of its individual Directors.
This Court is unable to sustain the impugned order in so far as the said order confirms the attachment of the Petitioner’s individual Bank account notwithstanding his having ceased to be a Director of AEPL whose tax dues were sought to be recovered - impugned attachment order and the corresponding order of the Commissioner of Sales Tax, Odisha affirming it are hereby set aside - petition is disposed off.
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2022 (12) TMI 1180
Dishonor of Cheque - legally enforceable debt - insufficiency of funds - condonation of delay to file a complaint beyond time by the complainant - HELD THAT:- The provision of Section 142 (b) of Negotiable Instruments Act, 1881 cannot be considered to be effective with retrospective effect. Therefore, learned trial court has wrongly passed the order for condontion of delay in filing the complaint by the complainant and, moreover, when the objection was raised before the revisional court, it did not consider it and has rejected the objection. Learned revisional also ignored the provision as contained under section 142(b) of the Negotiable Instruments Act, 1881 and did not give the benefit of the provision to the respondent. Therefore, it is observed that the complaint filed by the revisionist barred by limitation.
That so far as the nature of transaction is concerned, learned revisional court on the basis of evidence produced by the revisionist observed that cheque was given by the respondent to the revisionist for collateral security not as discharge to any of debt or other liability. Revisional Court after appreciating the material available on record rightly observed that the cheque was given as collateral security to the amount given by the revisionist to the respondents. There is no illegality in observation and conclusion drawn by the learned trial Court.
The criminal revision is dismissed.
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2022 (12) TMI 1179
Application for amendment in the plaint by deleting the name of the defendant no. 1 by substituting the name of the Liquidator of the defendant no. 1 in the cause title as well as in the plaint - overriding provisions of IBC over other laws - Section 238 of the Insolvency and Bankruptcy Code 2016 - HELD THAT:- In the instant case, one of the financial creditors of the defendant had initiated proceeding under Section 7 of the Insolvency and Bankruptcy Code 2016 against the defendant and the Tribunal had admitted the application and appointed Liquidator. The Liquidator had made Public announcement calling upon all the stakeholders of the defendant company for submission of their respective claim, if any, and the plaintiff has lodged its claim before the Liquidator but the same was rejected on the ground of limitation but in appeal the Learned Tribunal had admitted the claim of the plaintiff and admittedly the same is to be adjudicated by the Liquidator.
As Section 238 of the Code is having the override effect in any other law for the time being in force and thus the suit cannot be proceeded further as the claim made by the plaintiff in the instant suit is similar to the claim raised before the Liquidator - Section 61 of the Code provide for an appeal. In case the Liquidator rejects the claim of the plaintiff, the plaintiff is having remedy of an appeal.
This Court held that the suit filed by the plaintiff is cannot be proceeded further and thus CS No. 1 of 2016 is dismissed. The Registrar, Original Side of this Court is directed to release the Bank Guarantees submitted by the defendant no.1 in terms of the order passed by this Court in favour of the Liquidator Shri Krishna Kumar Chhaparia - Application disposed off.
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2022 (12) TMI 1178
Application has been filed for out of turn hearing of Appeal - HELD THAT:- In view of the submissions made in the application, the same is allowed and the Registry is directed to list the appeal for hearing on 12.12.2022. In the meanwhile, the department is directed to file application stating the fact when the Order-in-Original was sent and served upon the applicant along with supporting document, if any.
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2022 (12) TMI 1177
Maintainability of the writ petition - Availability of efficacious remedy of appeal - dispute pertains to questions of fact - seeking direction upon the respondents to show cause as to how an Officer of the State Taxes could carry out the proceedings under Section 129 of CGST Act - HELD THAT:- Having heard learned counsel for the parties and after going through the series of events, as also, taking into consideration that an efficacious alternative remedy by way of appeal is available to the petitioner under Section 107 of JGST Act, we therefore, grant liberty to the petitioner to approach the appellate authority against the impugned order passed under Form GST MOV 09. On his approaching, the State Taxes Officer, Intelligence Bureau, Jamshedpur Division, Jamshedpur shall provide the GSTIN number so that the petitioner can prefer an appeal online.
The writ petition is disposed of.
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2022 (12) TMI 1176
Maintainability of the writ petition - Availability of efficacious remedy of appeal - dispute pertains to questions of fact - seeking direction upon the respondents to show cause as to how an Officer of the State Taxes could carry out the proceedings under Section 129 of CGST Act - HELD THAT:- Having heard learned counsel for the parties and after going through the series of events, as also, taking into consideration that an efficacious alternative remedy by way of appeal is available to the petitioner under Section 107 of JGST Act, we therefore, grant liberty to the petitioner to approach the appellate authority against the impugned order passed under Form GST MOV 09. On his approaching, the State Taxes Officer, Intelligence Bureau, Jamshedpur Division, Jamshedpur shall provide the GSTIN number so that the petitioner can prefer an appeal online.
The writ petition is disposed of.
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2022 (12) TMI 1175
Cancellation of GST registration of petitioner - failure to furnish returns for a continuous period of six months - HELD THAT:- Since, the petitioner failed to furnish returns for a continuous period of six months and show cause notice has been sent to him, it is directed that the petitioner shall file an application for revocation under Section 30 of the CGST Act in terms of Rule 23 of the CGST Rules. Though it is time barred, we are inclined to wave the limitation and direct the petitioner to file an application for reviving of G.S.T. registration before the Revenue within a period of 21 days, hence. He shall also comply the other provisions of Section 30 of the U.K. GST Act, that is submission of returns for the defaulted six months and any further completed months after the revocation. In such case, if dues are found to be due from the petitioner and he pays the same, then his case shall be considered liberally by the revenue and shall be disposed of within a period of 30 days.
Petition disposed off.
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2022 (12) TMI 1174
Attachment of Bank account of petitioner - Remission of deficit court fees of Rs.600/- during the course of this day - petition dismissed on the ground that the appellant / writ petitioner is not aware of the fate of the revisional application, which it had filed against the order passed by the appellate authority dated 7th February, 2014 - HELD THAT:- The appeal is partly allowed and the order passed in the writ petition is set aside with a direction to the appellant to file an application before the revisional authority clearly setting out all facts and requesting the revisional authority to recall the order disposing of the revisional application and if such an application is filed, the revisional authority shall take up the same and pass a speaking order on merits and in accordance with law after affording an opportunity of personal hearing to the authorised representative of the appellant.
As stated by the learned Advocate for the appellant that sum of Rs.16,51,924/- has been recovered after the writ petition was dismissed, we feel the interest of revenue has been sufficiently safeguarded as more than 50% of the total dues has already been recovered. Therefore, the garnishee order for the balance amount shall be kept in abeyance and abide by the orders to be passed by the revisional authority in terms of the above direction.
The attachment of the bank account of the appellant shall be lifted within a period of three days from the date of receipt of the server copy of this judgment in order to enable the appellant to operate its bank account - Application disposed off.
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2022 (12) TMI 1173
Classification of goods - SAC Code - rate of GST - outward supply - support services - mangroves being cultivated and nurtured at coastal communities - HELD THAT:- It is evident that the appellant is engaged in business of cultivation, planting and nurturing of mangrove seeds and seedlings for the primary purpose of environmental protection by way of enhancing biodiversity and re-establishing the ecosystem functions and such services are not related to cultivation of plants for food, fibre, fuel, raw material or other similar products. Therefore, none of the activities carried out by the appellant for the purpose as laid down in the agreement qualifies to be agriculture as claimed by him which is essential to be classified under SAC 9986.
The services rendered by the appellant can be classified as ‘Other environmental protection services’ and not as ‘Support services to agriculture, forestry, fishing, animal husbandry’ - there are no infirmity in the ruling pronounced by the WBAAR being that the supply of services for plantation of mangrove seeds and seedlings in coastal areas shall be covered under Serial Number 32 of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 having SAC 9994 and shall attract GST @18%.
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2022 (12) TMI 1172
Condonation of delay in e-filing the audit report in Form No.10B has been rejected - whether respondent committed an error in passing the order by not condoning the delay in filing Form No.10B along with the return filed? - HELD THAT:- In the decision of this Court in Sarvodaya Charitable Trust vs. Income Tax Officer (Exemption) [2021 (1) TMI 214 - GUJARAT HIGH COURT] this Court has observed that furnishing of audit report along with return filed is to be treated as a procedural requirement.
It is though mandatory in nature the substantial compliance is required to be made. In the case of Sarvodaya Charitable Trust [2021 (1) TMI 214 - GUJARAT HIGH COURT] the assessee had produced the audit report after processing the return under Section 143(1). This Court in the said order has observed that the approach of the authority in these type of cases should be equitable, balancing and judicious. Technically speaking, respondent No.2 might be justified in denying the exemption under Section 11 of the Act by rejecting such condonation application, but an assessee, which is a public charitable trust for past 30 years which substantially satisfies the conditions for availing such exemption, should not be denied the same merely on the bar of limitation especially when the legislature has conferred wide discretionary powers to condone such delay.
Applying the said principle, the petition is allowed. The impugned order passed by respondent dated 12.3.2021 is quashed and aside. The impugned order of rectification under Section 154 of the Act dated 25.1.2019 is also quashed and set aside. The application for condonation of delay filed by the petitioner before the respondent is allowed.
Respondent is now directed to process the return in accordance with law. It is noticed that no assessment is framed and only an intimation under Section 143(1) of the Act was issued. No scrutiny could be carried out by the respondent since the audit report under Section 10B was not on record. Learned advocate for the petitioner Mr. B.S.Soparkar fairly submitted that the issue of benefit of exemption may be examined by issuance of notice u/s 143(1)/ 143(2) and the petitioner shall not object to the said proceedings by taking the ground of limitations.
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2022 (12) TMI 1171
Unexplained income u/s 69A - writ petitioner has deposited huge sums of money after demonetisation regime kicked in - As argued writ petitioner had in fact responded to the Section 142 (1) notice dated 30.11.2017 by way of return on 15.04.2019 but the respondent has not taken note of that - contention of the respondent that the respondent could not look into the responses of the writ petitioner solely because of technical glitch at the respondent's end - HELD THAT:- The question as to whether an opportunity should be given to the assessee by the assessing officer by giving a notice and calling upon the assessee to show cause when Section 142(1) notice has been issued is left open as in the case on hand the respondent had admitted in the counter affidavit that notice has been issued and the responses of the writ petitioner could not be looked into solely owing to technical glitch at the respondent's end. Therefore, this order is being made in the unique fact setting and circumstances of the present case.
It is also to be noted that the writ petitioner further contends that the writ petitioner is running a petrol bunk and there is a window available in this regard qua demonetisation. Therefore, this order will obviously not serve as precedent for Best judgment assessment orders under Section 144 where Section 142 (1) notice has been issued. In other words, this order is in the light of the admitted position of the respondent in paragraph 4 of the counter affidavit.
Matter restored back for denovo assessment.
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2022 (12) TMI 1170
Reopening of the assessment - Necessity of grant of approval u/s 151(ii) - Competent authority u/s 151(ii) to grant approval - HELD THAT:- It appears from record and instruction submitted by Mr. Dutt that in this said case approval has been granted by principal CIT -9, Kolkata who is not the authority falls u/s 151(ii) of the Act as such the approval in this case is not an authority authorized under the law and such approval is not sustainable in law and in view of this factual and legal position the impugned notice under Section 148A(b) of the Act and all subsequent proceedings are not sustainable in law and accordingly quashed.
Quashing of the impugned notice and subsequent proceedings will not be a bar on the part of the Income Tax authorities concerned to initiate any fresh proceeding in future in accordance with law.
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2022 (12) TMI 1169
Capital gain Computation - AO worked out the capital gain u/s 50C - Charging capital gain tax on the very same land on the basis of final execution of sale deed - CIT (A) deleted the addition made by the AO on the ground that the stated transaction had already been treated as transfer in A.Y.2009-2010 and capital gain earned thereon was brought to tax in hands of the assessee and had been accepted by the assessee also - HELD THAT:- No error in the Tribunals findings because undisputedly the issue relating to transfer of land to M/s. Aanya Developers in A.Y.2009-10 had attained finality and against the additions made no appeal has been preferred by the assessee and, therefore, the Tribunal is right in observing that the issue has been examined and taxed in A.Y.2009-10 on the basis of Banakhat (agreement to sale) dated 24.7.2008. The department has also considered the same as transfer in the Assessment order in A.Y.2009-10.Charging capital gain tax on the very same land on the basis of final execution of sale deed amounts to taxing the same twice over, which is not permissible.
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2022 (12) TMI 1168
Addition u/s 68 - genuineness and credit worthiness of the transaction in question - HELD THAT:- Under Section 68 of the Income Tax Act, if any sum is found credited in the Books of account of the assessee and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not satisfactory in the opinion of the Assessing Officer, the sum so credited may be charged to income tax as to the income of the assessee of that previous year. Therefore, what has to be inquired into by the AO is about the nature and source of the deposit. If the explanation with regard to the nature and source is found unsatisfactory, only then the amount so credited may be treated is income.
It is evident that the assessee though has disclosed the source of the deposit but could not establish the nature thereof. Three conditions which are required to be proved by the Assessee as per Section 68 of the Income Tax Act, 1961, could not be proved by him. The burden would, therefore, not shift on the revenue, as the assessee has failed to discharge her burden.
The assessee has failed to prove the transaction as per Section 68 - No substantial question of law, arises in the instant appeal for consideration.
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2022 (12) TMI 1167
Reopening of assessment - Validity of reasons to believe - Whether reasons to believe were based on some non-extent material or extraneous and irrelevant material? - HELD THAT:- Firstly, the Petitioner did not bother to file any returns during Assessment Year 2015-16. Secondly, the Petitioner did not bother to file any response to the notice dated 27.03.2021 seeking to reopen the assessment within the time limit allowed to the Petitioner. The Petitioner filed returns only after eight months at the stage when the time limit for completing the reassessment proceedings was almost due to conclude. In these circumstances, the Assessing Officer rightly invoked the principle in Union of India V/s. Major General Madan Lal Yadav [1996 (3) TMI 472 - SUPREME COURT].
Discretion apart, we find that this is a matter where the explanation (2) to Section 147 of the IT Act would apply. This explanation inter alia provides that where no return of income has been furnished by the assessee although his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year exceeded with a maximum amount which is not chargeable to income-tax, the same shall also be deemed to be a case where income chargeable to tax has escaped assessment.
Petitioner has not explained the amount of ₹2,15,107/-. The Petitioner may have its own version about the receipt of the amount of ₹6.74 crores. However, these are matters which can be looked into at the stage of reassessment. Based on the material available with the respondents, we cannot say that they either had no reason to believe or that their reasons to believe were based on some non-extent material or extraneous and irrelevant material.
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2022 (12) TMI 1166
Reopening of assessment u/s 147 - procedure followed for reassessment under Section 147 after newly inserted Section 148A - HELD THAT:- This is a case of proposed reassessment. In view of the newly inserted Section 148A in the Act, there has been a paradigm shift in the procedure followed for reassessment under Section 147 of the Act. Prior to issuance of notice under Section 148 of the Act, a notice under Section 148A(b) of the Act is required to be issued enabling the person concerned to submit reply, whereafter the assessing authority upon receipt of approval from the specified authority is mandated to pass an order under Section 148A(d) of the Act, whether the case is fit for reopening or not. Once it is decided that it is a case fit for reopening, consequential notice under Section 148 of the Act is issued.
Thus the order under Section 148A(d) of the Act is at a stage prior to issuance of notice under Section 148 of the Act. Unless glaring omissions are demonstrated or the conditions precedent for exercise of the power to reopen assessment are not complied with, a writ Court would not ordinarily interfere with an order passed under Section 148A(d) of the Act inasmuch as the proceedings is at a very nascent stage even prior to issuance of the statutory notice under Section 148 of the Act.
We are of the view that contentions raised by the petitioner can very well be raised in the reply to the notice issued under Section 148 of the Act. At this stage, preempting the authorities from proceeding further on the grounds urged in the writ petition would not be proper. We, therefore, decline to interfere in the matter.
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2022 (12) TMI 1165
Addition of interest from banks on the deposits made by it out of the maintenance deposit/ fund received from its members - obligation on the income earned by the Appellant out of the deployment of the maintenance deposit - assessee as a Trust or Co-operative Society - concept of mutuality - as submitted that the Appellant is required to maintain the society and incur common expense of the society out of the income received from the maintenance deposits, and thus, there is an overriding charge - HELD THAT:- As noted from the Balance Sheet the maintenance deposit is excessively used for maintenance of the residential premises and therefore, the collection of maintenance deposits are kept as fixed deposits in Axis Bank and HDFC Bank. From the sale deed also the said element of maintenance deposits has been collected from the owners of the flat.
The decision of the Ahmedabad Tribunal in case of Manekbuag Co-op. Housing Society Ltd. [2010 (3) TMI 1083 - ITAT AHMEDABAD] has clearly given the guidelines that when the main object of the society is to manage, administer, operate, supervise and make available the common facilities and maintains of its members to meet the expense on account of maintenance the housing society collected deposits from its members made deposits and earned interest thereon from banks which is squarely covered by the decision Adarsh Co-operative Housing Society Ltd. [1994 (10) TMI 32 - GUJARAT HIGH COURT] which was cited by the Ld. A.R. at the time of hearing.
The decision of Hon’ble Bombay High Court in case of Sind Co-op. Hsg. Society [2009 (7) TMI 15 - BOMBAY HIGH COURT] is squarely applicable in the present case as the income earned by the society on account of interest on Fixed Deposits from its members for the purpose of maintenance will attract the concept of mutuality and accordingly the income will be subject to exemption if any surplus is there. Thus, Ground No. 1 & 2 are allowed.
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