Gujarat Council Of Science City, ... vs Department Of Income Tax

The A.C.I.T., GNR Circle- V/S Gujarat Council of Science Gandhinagar City, Nr. Sola-Santej Road, Sola, Ahmedabad 380060

(Appellant) (Respondent)

PAN: AAABG0071B

Appellant by : Shri Nimesh Yadav, Sr. D.R. Respondent by : Shri Bipin J. Shah, A.R.

(आदे श)/ORDER

Date of hearing : 15-06-2015 Date of Pronouncement : 19 -06-2015

PER SHRI ANIL CHATURVEDI,A.M.

1. This appeal filed by the Revenue is against the order of CIT(A), Gandhinagar, Gujarat dated 02.09.2011 for A.Y. 2008-09.

2. The relevant facts as culled out from the material on record are as under.

3. Assessee is a company registered under the Societies Registration Act and the principal objective of the Assessee is to promote science and technology and to undertake and encourage research and training in various science activities. Assessee filed its return of income for A.Y. 2008-09 on 29.09.2008 declaring total income at Rs. Nil. The case was selected for 2 ITA No 3096/AHD/2011 . A.Y. 2008-09 scrutiny and thereafter the assessment was framed under section 143(3) vide order dated 22.11.2010 and while framing the assessment, the grant received from Government of Gujarat and contribution from GSDMA received by the Assessee was considered to be income by the A.O. Aggrieved by the order of A.O., Assessee carried the matter before ld. CIT(A) who vide order dated 02.09.2011 decided the issue in favour of the Assessee by holding as under:- 3.4. The matter has been considered. Similar issue has propped up in the appellant's appeals for earlier assessment years The appellate orders for assessment year 2006-07 further confirmed by the ITAT vide its order dated 17/07/2009 and 2007- 08 stand further confirmed by the ITAT vide its order dated 11/06/2010. The facts of the present case are exactly similar as in the preceding two years. The operative part of my predecessor's order dated 26/02/2009 for assessment year 2006-07 in the context is as follows:

"2.4.2. The above referred decision of Tribunal is quite decisive, though, with due respects, not as explicit as one would have expected, for the purpose of guidelines and application as a ratio. While the specific reference has been made to the amendment letter dated 31/01/2007 of the Science and Technology Department, referred to in the earlier paragraph, to hold that the grants are covered u/s.ll(l)(d), the factual position is that this letter covered only the grants given by the Government of Gujarat and forms about Rs.25 Cr. out of the total receipts of Rs.33,00,99,228/-. Since the directions of the Tribunal are all encompassing, it is to be presumed that the Tribunal while coming to this decision has also given the positive finding in favour of the appellant with respect to the grants received from Government of India as also from other Government agencies. This would be further vindicated by the fact that the order being a combined order for assessment years 2004-05 and 2005-06, the Revenue's appeal for assessment year 2004-05 on the CIT(A)'s order favourable to the assessee, have been dismissed. To put it in other words, the two above referred questions which were raised by the Assessing Officer and decided in favour of the revenue, seem to have been decided in favour of the assessee.

2.4.3. Hence, notwithstanding the undersigned's point of view (who passed the preceding year's appellate order) which remains the same as that of the preceding assessment year, i.e. assessment year 2005-06, to keep judicial discipline as also to implement the decision of a superior appellate authority, it is hereby held that the grants received by the Society were to be treated as covered u/s.ll(l)(d) being covered by the circular dated 31/01/2007 and being for the specific purpose of capital expenditure. Hence, the Assessing Officer's action in treating the amount ofRs.34,96,48,719/- as income is quashed."

3.5. Following the same, for this year also it is held that the Assessing Officer's action in treating the receipt of Rs. 11,39,81,781/- as income is not justified and hence the same is deleted.

4.The only remaining ground is Grounds 5, which is as follows:

3 ITA No 3096/AHD/2011 . A.Y. 2008-09 "5) Without prejudice to forgoing, if as per Ground Nos.2 to 4, it is held that the amount received as grant for a sum of Rs. 11,39,81,781/-is towards corpus of the Trust and hence not liable to be included in total income, the deficit as computed by the appellant in its return of income for A. Y. 2008-09 at Rs.27,22,76,988/- be directed to be carried forward."

4.1 This ground is consequential to the decision on the other three effective grounds and it has been decided in appeals of earlier years; that on the basis of the Gujarat High Court's decision in the case of CIT Vs. Shri Plot Swetamber Murti Pujak Jain Man 211 ITR 293 the appellant will be entitled to carry forward of deficit of income over expenditure. The same ratio has to apply to this assessment year also, in case there turns out to be a deficit due to the appellate decision, the appellant would be entitled to carry forward the deficit of income over expenditure. The ground is decided accordingly. However, as far as the quantum of the deficit is concerned, the same will have to be specifically quantified by the Assessing Officer.

4. Aggrieved by the aforesaid order of ld. CIT(A), Revenue is now in appeal before us and has raised the following grounds:-.

1. The learned CIT(Appeals) has erred in law and on facts in not considering the grants received from Govt. of Gujarat and contribution from Gujarat State Disaster Management Authority ( GSDMA) amounting to Rs.11,39,81,781/-, as income of the Trust u/s 11(1) of the I T Act and thereby deleting the addition made by the Assessing Officer on this issue.

5. Before us, the ld. D.R. supported the order of A.O. On the other hand, ld. A.R reiterated the submissions made before A.O and ld. CIT(A) and further submitted that the issue in the present case is covered in favour of the Assessee by the decision of Tribunal in Assessee's own case and which was considered by ld. CIT(A) while deciding the issue. He thus supported the order of ld. CIT(A).

6. We have heard the rival submissions and perused the material on record. We find that during the year Assessee had received grant from Government of Gujarat (Rs. 10.20 crore) and contribution from GSDMA (Rs. 1.19 crore) 4 ITA No 3096/AHD/2011 . A.Y. 2008-09 aggregating to Rs. 11.39 crore. A.O was of the view that the aforesaid contribution is to be considered as income of the Assessee. We find that ld. CIT(A) while deleting the addition has noted that in earlier year similar issue was decided in favour of the Assessee by the Tribunal in Assessee's own case. Before us, Revenue has not brought any contrary binding decision in its support nor could place any material on record to demonstrate that the decision of the Tribunal in Assessee's own case in earlier years that was considered by ld. CIT(A) has been overturned by the Hon'ble High Court. Further, Revenue has also not brought out any change in the facts or in law which would justify departure from the accepted position in earlier years. In view of the aforesaid facts, we find no reason to interfere with the order of ld. CIT(A) and thus this ground of Revenue is dismissed.

In the result, the appeal of Revenue is dismissed.

Order pronounced in Open Court on 19 - 06 - 2015.

Sd/- Sd/- (KUL BHARAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad. TRUE COPY Rajesh

Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) - 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER

Deputy/Asstt.Registrar ITAT,Ahmedabad