TMI Blog2010 (3) TMI 847X X X X Extracts X X X X X X X X Extracts X X X X ..... D. A., DEVANI H. N. MS. JJ. JUDGMENT D. A. Mehta J.- Heard learned counsel appearing for both sides. Considering the nature of controversy and the view that the court is inclined to adopt, the petition has been heard finally with the consent of the learned counsel for both the sides. Rule. Learned counsel appearing for the respondent is directed to waive service of rule. 2. The petitioner is the Ahmedabad Urban Development Authority, an autonomous body constituted under the provisions of the Gujarat Town Planning and Urban Development Act, 1976. The income of the petitioner was exempt till the assessment year 2002-03 under section 10(20A) of the Income-tax Act, 1961 (the Act), considering the fact that the petitioner was en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13 vide assessment order dated December 30, 2009, framed under section 143(3) of the Act. 5. The assessee has challenged the said assessment by way of appeal and the appeal is pending before the appellate authority. In the meantime, the assessee sought stay of demand. However, vide communication dated February 16, 2010 (annexure A) the respondent informed the petitioner that the request for stay of demand was accepted partially subject to the condition that 50 per cent. of the demand is paid up by February 25, 2010, failing which the respondent would initiate coercive measures to enforce the demand payable by the petitioner. It is this communication which is primarily challenged in the present petition along with the incidental/alternat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s cancelled only by order dated February 15, 2010, the same was with effect from April 1, 2002, and, hence, the petitioner was not eligible for exemption under section 11 of the Act and the assessment had correctly been framed. Therefore, the exercise of discretion by the Assessing Officer to recover 50 per cent. of the demand while staying the balance 50 per cent. of the demand should not be interfered with. Learned counsel read extensively from affidavit-in-reply dated March 12, 2010, filed by the respondent to emphasise the stand of the respondent authority. 9. Considering the fact that the appeal filed by the petitioner is pending before the first appellate authority the court does not intend to observe anything in relation to the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such a certificate of registration under section 12AA of the Act, therefore, cannot be ignored or wished away by the Assessing Officer by adopting a stand that the trust or institution is not fulfilling the conditions for applicability of sections 11 and 12 of the Act. In the case of Gestetner Duplicators P. Ltd. v. CIT [1979] 117 ITR 1 (SC), the apex court was called upon to determine as to whether the contribution made by the employer should be treated as a business expenditure, the requirement being contribution should be made to a recognized provident fund. In almost similar circumstances, the Assessing Officer in the said case did not hold in favour of the employer and the apex court, while deciding the controversy as to what constitu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the ratio enunciated as aforestated to the facts of the present case, it is apparent that while framing assessment order on December 30, 2009, it was not open to the Assessing Officer to ignore the certificate of registration dated October 23, 2003, granted under section 12AA of the Act by the Director of Income-tax (Exemption), Ahmedabad. Therefore, on this limited count the assessment order appears to be without jurisdiction and the demand in pursuance thereof could not have been sought to be recovered. The respondent was, therefore, duty bound to stay recovery of the demand raised pursuant to the assessment order dated December 30, 2009, for the assessment year 2007-08 till disposal of the first appeal which is already pending before ..... X X X X Extracts X X X X X X X X Extracts X X X X
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