2024 (11) TMI 694 - HC - Income Tax

Addition u/s 69A/ 69- source of the fixed deposits made in Allahabad bank- Entitlement to Exemption u/s. 10(26AAB) - ITAT stated that the assessee is an agricultural produce market committee constituted under Orissa Agricultural Produce Market Act, 1956 for the purpose of regulating the marketing of agricultural produce and in view of the same, the income of the assessee is eligible for exemption u/s 10 (26AAB) - HELD THAT - There is no material placed before this Court for consideration that the income derives from the purchase and sale of agricultural produce under the provisions of the Orissa Agriculture Produce Market Act, 1956 is liable for taxation. Therefore, this Court does not find any illegality or irregularity in the order passed by the Commissioner of Income Tax (Appeal), National Faceless Appeal Centre (NFAC), Delhi, which has been confirmed by the Income Tax Appellate Tribunal, Cuttack Bench, Cuttack. Decided against revenue.

Summary

Issues:
- Appeal against the order dated 28.11.2023 passed in ITA No.285/CTK/2023
- Exemption of income under Section 10(26AAB) of the Income Tax Act, 1961
- Assessment of total income under Section 147 read with Section 144 and Section 144B of the Income Tax Act
- Technical glitches in responding to notices issued by the Assessing Officer

Analysis:

The appellant filed an appeal seeking to set aside the order dated 28.11.2023 passed in ITA No.285/CTK/2023, which upheld the findings of the Commissioner of Income-tax (Appeals) regarding the assessment year 2018-19. The appellant had not filed the return of income for the financial year 2017-18, leading to the disposal of the appeal at the stage of fresh admission. The case involved the reassessment of the assessee under Section 148A (d) of the Income Tax Act, 1961, due to non-filing of the return. The Assessing Authority determined the total income of the assessee at Rs. 15,71,13,415/- after making additions under relevant sections of the Income Tax Act.

The Commissioner of Income Tax (Appeal) allowed the appeal filed by the assessee, noting that the source of fixed deposits was market fees received from a specific entity. The Commissioner observed that the assessee was exempted from tax under Section 10(26AAB) of the Act, as it was an agricultural produce market committee. The Tribunal upheld this finding, emphasizing the eligibility of the assessee for exemption and acknowledging technical glitches faced by the assessee in responding to notices from the Assessing Officer.

The Court found no material indicating that income derived from the purchase and sale of agricultural produce under the Orissa Agriculture Produce Market Act, 1956 was taxable. Consequently, the Court upheld the orders of the Commissioner of Income Tax (Appeal) and the Income Tax Appellate Tribunal, leading to the dismissal of the appeal. The judgment emphasized the eligibility of the assessee for exemption under Section 10(26AAB) and the absence of irregularities in the decisions of the lower authorities.