Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (12) TMI 209 - ITAT RAJKOTRevision u/s 263 - benefit of exemption under the order issued under the repealed Act - validity of order issued under the 1922 Act granting exemption to incomes earned in Part-B - as per CIT(A) AO had allowed the assessee’s claim of deduction u/s 80P(2)(c)/(d) of interest income and rental income without making proper verification/inquiry - whether the assessee was entitled to exemption of the aforestated two incomes in terms of order made under the provisions of the 1922 Income Tax Act, i.e Part-B States (Taxation Concessions) Order, 1950 amendment to Notification No.SRO 998 dated 2.12.1950? As per assessee contention being that after repeal of the 1922 Act, the entitlement to the exemption of the assessee in view of the aforestated order passed under 1922 Act, still existed, since the said order was not rescinded subsequently, and therefore, by virtue of provisions of section 297 (2)(k)/(l) of the Income Tax Act, 1961, the benefit of exemption under the order issued under the repealed Act still persisted. HELD THAT:- CIT found that an identical plea taken in Sri Gopal Gram Seva Sahakari Mandali Ltd. [2014 (12) TMI 766 - GUJARAT HIGH COURT] directed the AO to examine the allowability of assessee’s claim to deduction under section 80P of the Act, holding that the assessee did not continue to enjoy the exemption by virtue of order issued under the 1922 Act. Copy of the order was placed before us, and we have noted that identical plea of the assessee of continuing to enjoy the benefit of the order issued under the 1922 Act by virtue of section 297 (k)(l) of the 1961 Act was rejected by the Hon’ble High Court, and the Hon’ble Court had directed the AO to examine the assessee’s eligibility to claim deduction under section 80P(2) of the Act, 1961 Act. The ld.counsel for the assessee agreed with the same but at the same time has countered by stating that the Hon’ble Apex Court in the case of Maharao Bhim Singh of Kota Vs. CIT [2016 (12) TMI 418 - SUPREME COURT] had reversed this proposition of law laid down by the jurisdictional High Court holding that the exemption allowed under the order issued under 1922 Act persisted and applied even under 1961 Act. But as gone through the order of the Hon’ble Apex Court in the said case, and we find that it is entirely distinguishable on facts, and the Hon’ble Apex Court has not laid down any such proposition that the order issued under the 1922 Act granting exemption to incomes earned in Part-B States would continue to subsist even under the 1961 Act. In the case before the Hon’ble Apex Court, the Issue for consideration was the interpretation of section 10(19A) of the Act which provided for exemption of annual value of any one palace in the occupation of a Ruler. The dispute arose in the factual background that the palace was partly self occupied by the Ruler and partly let out earning rental income. The claim of the Revenue was that the entitlement to exemption u/s 10(19A) of the Act was to be confined only to the portion of the palace in the occupation of the Ruler. The Hon’ble apex court interpreted the provisions of section 10(19A) of the Act to state that it granted exemption to the annual value of any one palace which fulfilled the following conditions, viz. (i) which in the occupation of the ruler, and (ii) whose annual value was exempt from income tax before the commencement of the Constitution (Twenty-sixth Amendment) by virtue of the provisions of the Merged States (Taxation concessions) Order, 1949 or the Part B States (Taxation Concessions), Order 1950. Noting so, the Hon’ble Apex Court found that the assessee fulfilled both the conditions in the case before it, and therefore was entitled to exemption of the entire annual value of the property. It is abundantly clear, therefore, that the Hon’ble Apex Court in the said decision did not lay down any proposition, as canvassed by the ld.counsel for the assessee before us that the exemption granted under the order issued under section 60A of the Income Tax Act, 1922, subsisted since it was not repealed. Therefore, we do not find any merit in the arguments of the ld.counsel for the assessee that the decision relied upon by the ld.Pr.CIT of the jurisdictional High Court was reversed by the Hon’ble Apex Court. The order of the ld.Pr.CIT is therefore confirmed, and the grounds of the appeal of the assessee are dismissed.
|