Maharashtra Industrial Developement ... vs Department Of Income Tax

DDIT(Exemption) 1(1) M/s. Maharashtra Industrial Room No. 504, 5th Floor Development Corporation Vs. Piramal Chambers, Parel Udyog Sarthi, Mahakali Caves Mumbai 400012 Andheri (E), Mumbai 400093 PAN - AAACM3560C Appellant Respondent

Appellant by: Shri Surinderjit Singh Respondent by: Shri Manoj Kale

Date of Hearing: 05.03.2015 Date of Pronouncement: 05.03.2015

ORDER

Per D. Manmohan, V.P.

This appeal by the Revenue is directed against the order passed by CIT(A)-1, Mumbai and it pertains to A.Y. 2007-08.

2. The following grounds were urged before us: -

"1. That on the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in allowing the carry forward of deficit of Rs.40,58,62,345/- on account of excess expenditure relying on the decision of the Hon'ble Bombay High Court in the case of CIT Vs. Institute of Banking Personnel Services reported in 264 ITR 110 (Bom) ignoring the fact that this would have the effect of granting double benefit to the assessee, first as 'accumulation' of income u/s 11(1)(a) or as corpus donation u/s 11(1)(d) in earlier year/current year and then as 'application' of income u/s.

11(1)(a) in the subsequent year which was legally not permissible?

2. That on the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in allowing the claim of the assessee for carry forward of the said deficit, ignoring the fact that there was no express provision in the IT Act, 1961 permitting allowance of such claim."

2 ITA No. 6129/Mum/2013 M/s. Maharashtra Industrial Development Corporation

3. Facts necessary for disposal of the appeal are stated in brief. Assessee is a trust registered under section 12A of the Income Tax Act. During the year assessee claimed total application of funds of `40,58,62,345/- and adjusted the same against surplus as per Income & Expenditure account. Funds which wee not applied were not allowed to be carried forward by the AO. Surplus of `7,60,050/- was, therefore, brought to tax. Assessee preferred an appeal before the CIT(A) and contended that identical issue was decided in favour of the assessee in its own case for A.Y. 2008-09 (ITA No. 6752/Mum/2011 dated 15.03.2013). Having regard to the view taken by the ITAT, the learned CIT(A) set aside the disallowance made by the AO.

4. Aggrieved, Revenue is in appeal before us. At the time of hearing the learned counsel for the assessee submitted that in respect of A.Y. 2005-06 on identical issue the order passed by the ITAT was affirmed by the Hon'ble High Court (I.T. Appeal No. 2652 of 2011 dated 20th March, 2013). Since the view taken by the learned CIT(A) is in conformity with the view taken by the Hon'ble High Court (supra), he submitted that the order passed by the learned CIT(A) does not call for any interference.

5. On the other hand, the learned D.R. strongly relied upon the order passed by the AO.

6. We have considered the rival submissions and carefully perused the record. Since the view taken by the learned CIT(A) is in conformity with the view taken by the Hon'ble Bombay High Court in assessee's own case for A.Y. 2005-06, which is not disputed by the Revenue, we do not find any infirmity in the order passed by the CIT(A).

7. In the result, the appeal filed by the Revenue is dismissed.

Order pronounced in the open court on 5th March, 2015.

Sd/- Sd/- (Chandra Poojari) (D. Manmohan) Accountant Member Vice President

Mumbai, Dated:5th March, 2015 3 ITA No. 6129/Mum/2013 M/s. Maharashtra Industrial Development Corporation Copy to:

1. The Appellant 2. The Respondent 3. The CIT(A) - 1, Mumbai 4. Director of Income Tax (E), Mumbai 5. The DR, "B" Bench, ITAT, Mumbai

By Order

//True Copy// Assistant Registrar ITAT, Mumbai Benches, Mumbai n.p.