TMI Blog2023 (6) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... ny such activity as contemplated u/s 28 of the I.T. Act. The assessee had filed its return of income as a Local Authority . Assessment was framed in the status of Artificial Juridical person . The assessee has placed reliance on the judgment of M/s N.S. Committee [ 2012 (3) TMI 713 - ITAT DELHI] wherein the Tribunal had cancelled the assessment on the basis that the AO had framed assessment in a different status. It is the case of the assessee that in the present case also the AO had issued notice as a Local Authority and the assessment has been framed in the name of Artificial Juridical person . The AO could not have changed the status from Local Authority to Artificial Juridical person and therefore the assessment framed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal when the jurisdictional notice issued u/s 143(2) and the assessment order passed u/s 143(3) by the 'Joint Commissioner of Income Tax, R-l, Muzaffarnagar' on this basis is, being without empowered u/s 120(4)(b) of the IT Act 1961, illegal and without jurisdiction. 4. That on whole facts and circumstances of the case and materials on record, the Id. C.I.T. (A) is not justified and correct in rejecting the plea of the appellant that the 'Joint Commissioner of Income Tax' issuing the jurisdictional notice u/s 143(2) and passing the assessment order u/s 143(3) on this basis is an 'Assessing Officer' within the definition of section 2(7A) of the IT Act 1961 in respect of the appellant's case. 5. That the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1961 (the Act ) on returned income. Subsequently, the case was selected for scrutiny assessment. During scrutiny assessment proceedings the assessee was asked to explain as to how it is entitled for exemption of the income. The reply submitted by the assessee was not found acceptable by the Assessing Officer and he assessed the income by making addition of Sentage receipts by observing as under: 14. Since the assessee does not enjoy the exemption u/s 12AA of Income Tax Act, 1961, the benefit of Sec 11 cannot be allowed and the income is to be computed as it is computed in normal business case. However since there are no surplus generated during the year under consideration hence there is no income for tax but the assessment is complet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovide that entire amount of commission will be utilized for the construction of road and other development work When the main object of the assessee is road construction all the receipt should be part of assessee s income. The assessee cannot be allowed to take benefit of the expenditure ignoring the receipt of similar type. Thirdly it is' not necessary that the receipt from the state is necessarily non taxable as discussed above. In the instant case the grant by the Sugar Mills is considered commission/income of Cane Development Council and TDS is regularly deducted. Later, the expenditure is adjusted from such receipt and surplus is reflected. The argument of the assessee that there is no income receipt is unacceptable beca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on record. 5. The learned DR supported the orders of the authorities below. 6. I have heard the learned DR and perused the material available on record. The assessee has filed various written submissions. The submissions of the assessee are that the assessee is a local authority. The case of the assessee was picked up for scrutiny assessment. The objections of the assessee are that as per the provisions of U.P. Sugar Cane (Regulation of Supply Purchase) Act, 1953, the assessee is neither authorized to do any business/profession or any other activity with profit motive, nor it is doing any such activity as contemplated u/s 28 of the I.T. Act. The assessee had filed its return of income as a Local Authority . However, the assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
