Bureau Of Indian Standards,, New Delhi vs Department Of Income Tax

ITO (E), Trust Ward III, vs. Bureau of Indian Standards, New Delhi. Manak Bhawan, 9, Bahadur Shah Zafar Marg, New Delhi - 110 002.

(PAN : AAATB0431G)

(APPELLANT) (RESPONDENT)

ASSESSEE BY : Smt. Lalitha Krishnamurthy, CA REVENUE by : Smt. A. Mishra, CIT DR

Date of Hearing : 15.04.2015 Date of Pronouncement : .04.2015

ORDER

PER GEORGE GEORGE K., JM :

This appeal, at the instance of the revenue, is directed against the

order of the CIT (A)-XXI, New Delhi dated 30.01.2013. The relevant

assessment year is 2009-10.

2. The assessee was registered u/s 12A vide order dated 15.01.1976

issued by the Department. The assessee was also accorded exemption u/s

10(23C)(iv) by the Director General of Income-tax (Exemptions) vide

order no.167 dated 30.04.2008/02.05.2008 for the assessment year 2007- 2 ITA No.2174/Del./2013

08 and onwards. The main thrust of Bureau of Indian Standards is towards

building a quality culture and consciousness amongst consumers with

formulation and implementation of National Standards.

3. The Assessing Officer, in the course of assessment proceedings,

observed that the assessee is neither in the field of education nor in the

field of medical relief or relief of poor and also observed that the assessee

cannot be considered for the benefit of exemption u/s 10(23C)(iv) and u/s

11 & 12 of the Income-tax Act, 1961 (for short, the Act) after verifying the

applicability of the proviso to section 2(15) of the Act since its activities

are falling within the scope of 'general public utility'.

4. The AO, on the basis of observations made in assessment order and

amended provision of law w.e.f. AY. 2009-10, made a proposal for

reconsideration of exemption accorded u/s 10(23C)(iv) and the same was

forwarded to DGIT (E) under clause (i) of the first proviso to section

143(3) of the Act. In the meanwhile, the AO kept the proceedings in

abeyance till the order of the DGIT(E). The DGIT (E) vide order dated

24.02.2012 withdrew the 10(23C)(iv) exemption w.e.f. AY 2009-10 and

onwards. Therefore, the AO completed the assessment on 19.04.2012 and

assessed the income at Rs.71,96,90,352/-.

5. Aggrieved, the assessee preferred an appeal before the First

Appellate Authority. During the course of appellate proceedings, the

assessee submitted that the assessee went in appeal before the Hon'ble 3 ITA No.2174/Del./2013

Delhi High Court against the order of the DGIT (E) dated 24.02.2012 and

the Hon'ble High Court has allowed the appeal in favour of the assessee

and directed to allow exemption u/s 10(23) of the Act. It is submitted by

the assessee that in compliance of the order of the Hon'ble High Court, the

DGIT (E), New Delhi vide order dated 04.12.2012 has allowed the

exemption u/s 10 (23) of the Act. The CIT (A), after perusing the order of

the Hon'ble Delhi High Court and the order of DGIT (E) dated

04.12.2012, held that the assessee is not a commercial organization and it

is not hit by newly amended provision to section 2(15) applicable from AY

2009-10 and also held that the assessee deserved the exemption u/s 11/12

of the Act.

7. The revenue being aggrieved is in appeal before us by taking the

following grounds :-

"1. "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in holding that the activities of the assessee are charitable in nature and not in the nature of trade, business or commerce particularly when the receipts of the assessee are from sales/services, fees/subscription, royalty & publication and other income.

2. On the facts and in the circumstances of the case and in law, the Ld.CIT(A) has failed to appreciate the fact that the exemption was denied to the assessee on the basis of the TDS certificates filed, which reflects that these are received from the different parties and of the nature of Fees from Professional/Technical Services/Contractual receipts are commercial in nature and the activities of the assessee is covered by the amended proviso to section 2(15) of the Act."

4 ITA No.2174/Del./2013 9. We have heard rival submissions and perused the material on record.

The controversy in this case arises when the Assessing Officer forwarded a

proposal for reconsideration of exemption accorded u/s 10(23)(iv) to the

DGIT (E) and the DGIT (E) vide order dated 24.02.2012 has withdrawn

the 10(23C)(iv) exemption w.e.f. AY 2009-10 and onwards. Accordingly,

the Assessing Officer assessed the income vide order dated 18.04.2012 u/s

143(3) r.w.s. 153(4)(iia) of the Act. The assessee went in Writ Petition

before the Hon'ble jurisdictional High Court against the order of the DGIT

(E) dated 24.02.2012 and the Hon'ble High Court has allowed the Writ

Petition of the assessee vide judgment dated 26.09.2012 allowing

exemption u/s 10(23) of the Act. In view of the judgment of Hon'ble High

Court, the assessment order passed by the Assessing Officer on this issue

does not survive. The order of the CIT (A) being in conformity with the

order of the Hon'ble High Court, we see no reason to interfere with the

order of the CIT (A) and the same is upheld. It is ordered accordingly.

10. In the result, the appeal of the revenue is dismissed.

Order pronounced in open court on this 17th day of April, 2015.

Sd/- sd/- (I.R. RAO) (GEORGE GEORGE K.) ACCOUNTANT MEMBER JUDICIAL MEMBER

Dated the 17th day of April, 2015 TS 5 ITA No.2174/Del./2013

Copy forwarded to: 1.Appellant 2.Respondent 3.CIT 4.CIT(A)-XXI, New Delhi 5.CIT(ITAT), New Delhi. AR, ITAT NEW DELHI.