CIT Vs. KRISHI UPAJ MANDI SAMITI

JUDGEMENT

(1.) IT has been informed to this court that the appeal preferred by the Revenue against the order of assessment being D.B. Income Tax Appeal No. 167/2010 came to be dismissed by this Court vide judgment dt. 18th August, 2010 in CIT v. Krishi Upaj Mandi Samiti (2011) 38(1) ITCL 440 (Raj -HC): (2011) : 331 ITR 174 (Raj).

(2.) AS it reveals from the record, the assessment order was initially passed by the assessing authority on 11th December, 2006 and that was challenged in appeal before the Commissioner (Appeals) which was partly allowed and while confirming the additions made by the Assessing Officer, the Commissioner (Appeals) directed to allow depreciation on various assets. The assessee further approached the ITAT against the order of Commissioner (Appeals) and the ITAT while setting aside the order of the authorities directed the Assessing Officer to make assessment afresh after affording adequate opportunity of being heard to the assessee. Against the order of ITAT dt. 30th April, 2008, the department preferred appeals U/s. 260A of the Act and such appeals came to be dismissed by the Division Bench of this court vide judgment dt. 18th August, 2010 in Krishi Upaj Mandi Samitis case (supra).

(3.) IT further reveals that in the meanwhile, the Assessing Officer in accordance with the provisions of the Act considered the order of Commissioner (Appeals) and proceeded with penalty proceedings U/s. 271(1)(c) and imposed penalty on the basis of additions sustained by Commissioner (Appeals) vide order dt. 26th February, 2007. However, an appeal came to be preferred by the assessee before the Commissioner (Appeals) who vide order dt. 18th November, 2008 cancelled the penalty observing that the assessment which formed the basis of the penalty order has been set aside by the ITAT with the direction to make assessment afresh and there was no justification for levy of penalty. However, against the order of Commissioner (Appeals), the revenue preferred appeal before the ITAT that came to be rejected vide order dt. 20th March, 2009 observing that there is no reason to interfere with the first appellate order on the issue as the very basis of levy of penalty i.e. the assessment order making assessment treating the assessee as Trust is not eligible for exemption from income as a Trust has been ultimately set aside by ITAT with direction to treat the assessee as Trust and make assessment afresh in accordance with law.