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TMI Blog2017 (10) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not inspire confidence unless positive and cogent evidence is brought on record to that effect as normally when the operations are transferred/divested, then adequate provisions are made in the agreements to preserve all rights in existing agreements which are either taken over by successor or are retained by transferor but to say that the liability has ceased just because IAAI divested its operations in favour of the Mumbai International Airport Limited cannot be accepted unless positive cogent evidence is brought on record to that effect to prove the said contention. Thus matter need to be set aside to the file of the Assessing Officer for de novo determination. Outstanding liability of Cost recovery customs - Held that:- The assessee once agreed to bear these costs, thereafter, cannot interfere with the Government of India in discharging its duties, obligation and responsibilities towards performance of the sovereign functions of the State under the Customs Act, 1962, unless it is brought on record that decision of the Government of India in deploying additional staff and officers is unconscionable or is suffering from perversity. Nothing of that sort is emanating fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue for different assessment years. These appeals were heard together and are disposed of by this common order. 2. First we shall take up the appeal bearing I. T. A. No. 884/Mum/2012 which is filed by the assessee for the assessment year 2009-10 challenging the order dated December 27, 2011 passed by the learned Director of Income-tax (Exemption) (hereinafter called DIT(E) ) under section 12AA(3) of the Income-tax Act, 1961 cancelling registration of the assessee and holding that the assessee is a non-charitable trust/institution. The Director of Income-tax (Exemption) cancelled the registration of the assessee as charitable trust/institution keeping in view the proviso to section 2(15) of the 1961 Act which was being added thereto with effect from April 1, 2009 by the Finance Act, 2008 and the Finance Act, 2010, which reads as under : Section 2(15) (15) 'charitable purpose' includes relief of the poor, education, medical relief, preservation of environment (including watersheds, forests and wildlife) and preservation of monuments or places or objects of artistic or historic interest, and the advancement of any other object of general public utility : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... infrastructure facilities including handling, storage and transportation of import and export cargo of diamonds, precious and semi-precious stones are provided to the gem and jewellery traders and members of the assessee. The services rendered by the asses see, thus, as contended by the assessee were as under : (1) Provision of rent-free accommodation for housing and customs clearance centre as well as the custodian's office. (2) Maintenance of strong room at the DPCCC as well as at the Sahar International Air Cargo Complex. (3) Provision of security and to and for transportation of export and import parcels between DPCCC and Sahar International Air Cargo Complex on every working day. (4) Depositing of airways bills with respective airline offices. (5) Collection and distribution of EP copies of shipping bills. (6) Providing export/import statistics on website of the assessee on regular basis. It was stated that the above arrangement was on cost recovery basis. These services were rendered by the assessee to the gem and jewellery traders only. Thus, it was contended that the basic motive of the assessee is to provide services to the members and not to make ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3) of the 1961 Act. 3. Aggrieved by the orders dated December 27, 2011 passed by the learned Director of Income-tax (Exemption) under section 12AA(3) of the 1961 Act cancelling/withdrawing the registration as allowed to the assessee in the earlier years under section 12AA of the 1961 Act with effect from the assessment year 2009-10, the assessee filed first appeal before the Tribunal. 4. The assessee has reiterated its submissions as were made before the learned Director of Income-tax (Exemption) which are not repeated for the sake of brevity. The assessee also contended that the activities of the assessee were held to be charitable by the hon'ble apex court in the assessee's own case in DIT v. Bharat Diamond Bourse [2003] 259 ITR 280 (SC) vide orders dated December 16, 2002. wherein their Lordships held as under (page 284) : Section 2(15) of the Act defines 'charitable purpose' as including relief of the poor, education, medical relief, and the advancement of any other object of general public utility. In order to decide the first question, the circumstances under which the appellant-assessee came into existence are required to be noticed. The diamo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms Act. It was also notified that MMTC would be the custodian with regard to the export cargo until they are trans-shipped and handed over to the airlines at Sahar International Airport, Bombay. When MMTC was appointed as the custodian, it had incurred expenditure on behalf of Bharat Diamond Bourse to the extent of about ₹ 81 lakhs for setting up of the bourse. On August 31, 1984 the managing committee of the assessee resolved to treat the expenses incurred by MMTC as a loan which was to be returned with interest at six per cent. per annum. The MMTC had taken certain premises on lease in the Diamond Plaza which was sub leased to the assessee on the same terms and conditions except for the deposit. The principal object of establishment of the bourse was to facilitate the diamond trade so that maximum revenue could be earned by way of foreign exchange and also to make the diamond trade more competitive at the international level. On December 15, 1986 an agreement was arrived at between MMTC and the assessee under which it was agreed that, from April 1, 1988, service charges would be collected by the assessee and not by the MMTC, and from that date the bourse would meet its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase [1980] 121 ITR 1 (SC) was an association established to promote commerce and trade in art silk yarn, raw silk, cotton yarn, art silk cloth, silk cloth and cotton cloth. Its objects, as evidenced from the memorandum of association, included, inter alia, carrying on business in art silk yarn, raw silk, cotton yarn, art silk cloth, silk cloth, and cotton cloth belonging to and on behalf of its members as well as buying and selling and dealing in all kinds of cloth and yarn belonging to and on behalf of its members. The Constitutional Bench of this court held that, if there are several objects of the institution, some of which are charitable and some non-charitable, and the trustees or the managers in their discretion may apply the income of the institution of those objects, the trust or institution would not be liable to be regarded as charitable and no part of its income would be exempted from tax. Where the main or primary objects are distributive, each and every one of the object must be charitable in order that the trust be held as a valid charity. But, if the primary or dominant purpose of the institution is charitable and another which, by itself, may not be charitable, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e liaison between diamond trade and industry in India and abroad with a view to promoting their sales from India in international market. (iii) To promote, advance, protect and develop trade, commerce and industry in India relating to exports and imports of diamonds and (iv) To develop India as modern and sophisticated diamond market by establishing and maintaining an international trading centre in India for all those engaged as manufacturers, traders, exporters and importers, brokers/commission agents of diamonds.' These being the predominant objectives, we agree with the view taken by the Tribunal as well as the High Court that the assessee was rightly registered under section 11 by treating it as an institution established for charitable purpose within the meaning of section 2(15) of the Act. It was argued that amendments have been brought in by the statute to section 2(15) of the 1961 Act wherein provisos 1 and 2 are inserted by the Finance Act, 2008 and the Finance Act, 2010 with effect from April 1, 2009, which was further amended by the Finance Act, 2011 with effect from April 1, 2012 and the Finance Act, 2015 with effect from April 1, 2016. The lear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n circumstances Circular No. 21 of 2016 [F. No. 197/17/2016-ITA-I], dated May 27, 2016 Sections 11 and 12 of the Income-tax Act, 1961 ('Act') exempt income of charitable trusts or institutions, if such income is applied for charitable purpose and such institution is registered under section 12AA of the Act. 2. Section 2(15) of the Act provides definition of 'charitable purpose'. It includes 'advancement of any other object of general public utility' provided it does not involve carrying on of any activity in the nature of trade, commerce or business etc. for financial consideration. The second proviso to said section, introduced with effect from April 1, 2009 vide the Finance Act 2010, provides that in case where the activities of any trust or institution is of the nature of advancement of any other object of general public utility and it involves carrying on of any activity in the nature of trade, commerce or business ; but the aggregate value of receipts from such commercial activities does not exceed ₹ 25,00,000 in the previous year, the purpose of such trust/institution shall be deemed as 'charitable' despite it deriving c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reted income of certain trusts and institutions, cancellation of registration granted under section 12AA may lead to a charitable institution getting hit by sub-section (3) of section 115TD and becoming liable to tax on accreted income. The cancellation of registration without justifiable reasons may, therefore, cause additional hardship to an assessee institution due to attraction of tax liability on accreted income. The field authorities are, therefore, advised not to cancel the registration of a charitable institution granted under section 12AA just because the proviso to section 2(15) comes into play. The process for cancellation of registration is to be initiated strictly in accordance with section 12AA(3) and 12AA(4) after carefully examining the applicability of these provisions. 6. The above may be brought to the notice of all concerned. Thus, it was submitted that in view of the Central Board of Direct Taxes Circular No. 21 dated May 27, 2016, the registration of the assessee under section 12AA of the 1961 Act need not be cancelled, while if the assessee's activities are hit by the amended provisions of section 2(15) of the 1961 Act, the tax exemption could b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Board of Direct Taxes circular and it was submitted that in any case, the Central Board of Direct Taxes circular is prospective in nature and there is no occasion to apply the same retrospectively. It was submitted that there is a clear finding by the learned Director of Income-tax (Exemption) that the assessee's activity are in the nature of trade, business and commerce and/or services in relation to trade, commerce and business carried out by gem, diamond and jewellery traders and is clearly hit by the proviso to section 2(15) of 1961 Act. It is also submitted that it is not a marginal case where the turnover is close to the cut-off turnover specified in section 2(15) of the 1961 Act rather the turnover of the assessee is significantly higher than minimum turnover stipulated by section 2(15) of the 1961 Act and hence no purpose will be served by retaining the registration by the assessee under section 12AA of the 1961 Act. 6. The learned counsel for the assessee in rejoinder submitted that the hon'ble Bombay High Court in the case of DIT (Exemptions) v. Maharashtra Housing and Area Development Authority [2017] 392 ITR 240 (Bom) has duly considered the decision of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the assessee. The services rendered by the assessee, thus, as contended by the assessee were as under : (1) Provision of rent-free accommodation for housing and customs clearance centre as well as the custodian's office. (2) Maintenance of strong room at the DPCCC as well as at the Sahar International Air-cargo Complex. (3) Provision of security and to and for transportation of export and import parcels between DPCCC and Sahar International Air Cargo Complex on every working day. (4) Depositing of airways bills with respective airline offices. (5) Collection and distribution of EP copies of shipping bills. (6) Providing export/import statistics on website of the assessee on regular basis. It was stated that the above arrangement was on cost recovery basis. These services were rendered by the assessee to gem and jewellery traders only. The services rendered by the assessee were held to be charitable activities by the hon'ble apex court in the assessee's own case in DIT v. Bharat Diamond Bourse [2003] 259 ITR 280 (SC) vide orders dated December 16, 2002, wherein the hon'ble apex court considered the pre-amended provisions of section 2(15) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under : (3) Where a trust or an institution has been granted registration under clause (b) of sub-section (1) or has obtained registration at any time under section 12A as it stood before its amendment by the Finance (No. 2) Act, 1996 (33 of 1996) and subsequently the Principal Commissioner or Commissioner is satisfied that the activities of such trust or institution are not genuine or are not being carried out in accordance with the objects of the trust or institution, as the case may be, he shall pass an order in writing cancelling the registration of such trust or institution : Provided that no order under this sub-section shall be passed unless such trust or institution has been given a reasonable opportunity of being heard. The courts have taken a consistent view that the learned Principal Commissioner or Commissioner shall have power to cancel the registration only on fulfilment of either of the conditions as stipulated by the provisions of section 12AA(3) of the 1961 Act that the activities of such trust or institution are not genuine or are not being carried out in accordance with the objects of the trust or institution. Thus, the learned Principal Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 2(15) of the 1961 Act. The Assessing Officer shall during the course of assessment, record a finding as to whether the activities of the assessee although being in the nature of activities of advancement of objects of public utility falls within four corner of trade, commerce or business, or any activity of rendering any service in relation to any trade, commerce or business, for a cess or fee or any other consideration, irrespective of the nature of use or application, or retention, of the income from such activity as mandated under section 2(15) of the Act or not, uninfluenced by our prima facie finding as recorded earlier in this order. There is a specific provision inserted by the Finance Act, 2012 with effect from April 1, 2009 vide sub-section (8) of section 13 of the 1961 Act to that effect which is reproduced hereunder : Section 11 not to apply in certain cases.-(1) to (7) . . . (8) Nothing contained in section 11 or section 12 shall operate so as to exclude any income from the total income of the previous year of the person in receipt thereof if the provisions of the first proviso to clause (15) of section 2 become applicable in the case of such perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall take up the cross-appeals filed by the assessee and the Revenue in I. T. A. No. 2789/Mum/2011 and I. T. A. No. 4437/Mum/2011 respectively for the assessment year 2005-06. 12. The grievance of the assessee in its appeal are two fold. Firstly, the assessee is aggrieved by the additions sustained by the learned Commissioner of Income-tax (Appeals) to the tune of ₹ 4,38,34,270 which was outstanding in the books of the assessee towards IAAI handling charges. Second the grievance of the assessee is with respect to the addition sustained by the learned Commissioner of Income-tax (Appeals) towards the disallowance of provision for outstanding liability of cost recovery customs to the tune of ₹ 24,58,567. While the Revenue's grievance is with respect to the relief given by the learned Commissioner of Income-tax (Appeals) of ₹ 3,79,78,729 towards the deletion of the addition made towards the opening balance of outstanding liability of cost recovery customs. 13. First we shall deal with the issue of disallowance of outstanding liability of IAAI handling charges to the tune of ₹ 4,38,34,270. 14. The brief facts of the case are that it was observed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and discharged at a future date. Thus, it was contended that the liability towards handling charges payable to IAAI subsists which is not denied by the assessee and also it is payable to the Central Government body which will also not get time barred. It was submitted that the liability for handling charges at ₹ 30 per parcel payable by the assessee to IAAI has arisen in terms of the arrangement agreed upon in April, 1989. It was submitted that there is no material on record based on which it can be contended that the said liability provided for in the books of account has ceased or is no longer payable. The assessee relied upon a large number of cases which are listed in page 6 of the appellate order of the learned Commissioner of Income-tax (Appeals) dated January 9, 2011. The assessee also filed the following documents in support of its contentions that licence fee is payable to MMTC, as detailed hereunder : (i) Copy of the agreement dated December 15, 1988 between the assessee and MMTC. (ii) Details of licence fee paid to the Airport Authority of India during the financial years 2004-05 and 2005-06. (iii) Copies of two invoices for licence fees. The learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mporters. Similarly export cargo is also received at the strong room at Sahar which has been apprised by the Customs at DPCC and Seepz. These parcels are subsequently handed over to the airlines under the preventive escort. From the above, it is clear that no sale/purchase transactions take place in the strong room and also MMTC do not have any turnover emanating out of these transactions ; hence the question of payment 10 per cent. of the turnover to you does not arise at all. From the above facts on record, the learned Commissioner of Income-tax (Appeals) observed that IAAI allotted strong room to MMTC and the said MMTC is paying the licence fee regularly to IAAI but the additional licence fee calculated at 10 per cent. of the gross turnover was not paid by MMTC to IAAI. The learned Commissioner of Income-tax (Appeals) observed that the turnover did not belong to MMTC and hence MMTC is therefore not liable to make the payment. It was observed by the learned Commissioner of Income-tax (Appeals) that there is no liability of the assessee to IAAI as the strong room was not allotted to the assessee but to MMTC. It was observed by the learned Commissioner of Income-tax (Appeals) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lity has been treated as income of the assessee by the authorities below for the instant assessment year under appeal before the Tribunal. It was submitted that the agreement was between MMTC and IAAI, wherein IAAI allotted strong room to MMTC. On being asked, it was submitted that no tax was deducted at source under the provisions of the 1961 Act by the assessee while making the provision in its books of account of such liability towards licence fee based on 10 per cent. of the turnover. It was also submitted that the said outstanding liability as was appearing in its books of account was written back in the assessment year 2011-12 as income as the said liability ceased to exist because of new entity namely Mumbai International Airport Limited being created by the Government of India to manage and operate the Mumbai Airport, wherein IAAI had divested and transferred all its operations to this new entity. It was also submitted that neither IAAI demanded the said amount from the assessee nor MMTC demanded this amount from the assessee. 19. The learned Departmental representative relied on the orders of the authorities below and submitted that the assessee did not raise this issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llection and distribution of EP copies of shipping bills. (6) Providing export/import statistics on website of the assessee on regular basis. It was stated that the above arrangement was on the cost recovery basis. It is stated that these services were rendered by the assessee to gem and jewellery traders only. We have observed that the Collector of Customs, Mumbai vide notification dated November 22, 1984 appointed MMTC, under section 45 of the Customs Act, 1962, as a custodian of imported and export cargo of diamonds, precious and semi-precious stones, pearls etc. We have observed that strong room was allotted to MMTC by IAAI in cargo complex of the Sahar International Airport, Mumbai which was in occupation of MMTC from February 26, 1985 (paper book pages 64-65). The terms of allotment of the said strong room provided fixed payments calculated based upon the area of strong room and additionally licence fee is payable to be computed at 10 per cent. based on the turnover. The asses see has placed communication dated April 20/21, 1989 by IAAI to MMTC which is placed on record (paper book pages 64-65) which reflect the said terms of allotment of strong room. Thus, IAAI is l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I that it has no turnover from strong room and hence there is no liability of MMTC to pay the said licence fee computed at 10 per cent. of the turnover as the turnover itself from strong room is zero. There is no latest communication placed on record by the assessee with respect to the claim of IAAI/MMTC with reference to licence fee payable based on 10 per cent. of the turnover. We have observed that the Revenue has also not made any enquiry to find out the bona fide and the genuineness of the claim of the assessee nor the said amount has been paid by the assessee. The assessee albeit made provisions in its books of account but did not pay the said amount of handling charges (licence fee) computed at 10 per cent. of its turnover to either MMTC or IAAI since 1985-86 i.e., for more than last twenty years which is being accumulated in its books of account and have now grown to a figure of ₹ 4,38,34,270 being an outstanding liability till March 31, 2005. The Revenue is now bringing the entire outstanding liability payable by the assessee as appearing in its books of account to tax on the grounds that the liability can no longer exists beyond a reasonable time as held by the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e submitted to IAAI. The licence has been granted by IAAI in favour of MMTC with reference to strong room at cargo complex at Mumbai Airport and the meaning of the word turnover has to be interpreted between the two contracting parties i.e. MMTC and IAAI as to what they understood ad idem by the word turnover while entering into licence agreement for strong room vide their original licence agreement/allotment letter between IAAI and MMTC, as the liability will devolve on the assessee based on the meaning and interpretation of the word turn over as understood ad idem by both the contracting parties to the agreement/allotment letter i.e. MMTC and IAAI. The said documents being licence agreement/allotment letter are not placed on record by the assessee before the authorities below as well before the Tribunal and are again withheld by the assessee which is again in breach of section 106 of the 1872 Act as the facts are especially in the knowledge of the assessee. The word turnover can have a different shades and meaning when used in different context. In the present context, it could mean either turnover of strong room service charges recovered or it could also mean gross turno ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtunity of being heard to the assessee in accordance with the principles of natural justice in accordance with law and after making such enquiries and verifications as the Assessing Officer may deem fit. The assessee is directed to produce all relevant and material information/evidences in relation to the said licence fee payable to IAAI/MMTC which is computed at 10 per cent. of the turnover. Needless to say that the Assessing Officer shall grant proper and adequate opportunity of being heard to the assessee in accordance with the principles of natural justice in accordance with law. We order accordingly. 21. The next issue in these cross-appeals are with respect to the cost recovery customs. The Assessing Officer observed that the assessee has made a provision of ₹ 85,09,032 under the head outstanding liability of cost recovery customs . The Assessing Officer observed that this liability is to be paid to the Customs Authority. The Assessing Officer observed that the assessee has paid a sum of ₹ 60,50,465 to the Customs Authority up till the year end. Thus, it was observed that a liability of ₹ 24,58,567 remains outstanding as on March 31, 2005. It was observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Government of India and the assessee was set up to co-ordinate facilities for the import and export of diamonds, gems and jewellery, precious and semi precious cargo. The assessee is providing infrastructure facilities including handling, storage and clearance of import and export cargo of diamonds, precious, semi-precious stones etc. We have observed that the Collector of Customs, Mumbai vide notification dated November 22, 1984 appointed MMTC, under section 45 of the Customs Act, 1962, as a custodian of imported and export cargo of diamonds, precious and semi-precious stones, pearls etc. The assessee entered into an agreement with MMTC by which it was agreed by MMTC to function as custodian at the office of the assessee where infrastructure facilities including handling, storage and transportation of import and export cargo of diamonds, precious and semi-precious stones are provided to gem and jewellery traders and members of the assessee. The Customs authorities deputed Customs officials and staff for doing functions under the Customs Act, 1962 for which pay and allowance of the Customs Plaza Customs Clearance Centre (DPCCC) and Sahar were recovered from the assessee throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s granted to the assessee to the extent of ₹ 3,79,78,729 with reference to the outstanding accumulated liability towards the Customs of the earlier years, as the Customs authorities were still making the claim of the same. While the learned Commissioner of Income-tax (Appeals) upheld the disallowance to the tune of ₹ 24,58,567 towards additional charge towards additional staff deployed by the Customs Department for the current year on the grounds that the assessee itself is denying the liability of the said additional charge to the Customs authority, vide appellate order dated January 9, 2011. 23. Aggrieved by the appellate order dated January 9, 2011 passed by the learned Commissioner of Income-tax (Appeals), both the assessee and the Revenue are in appeal before the Tribunal. 24. The learned counsel for the assessee reiterated its submissions as were made before the authorities below which are not repeated for the sake of brevity. It was submitted that the Government of India has not waived this liability and in fact the same stood recovered by the Government of India, wherein bank guarantee was issued on behalf of the assessee by Canara Bank in favour of the Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oms Clearance Centre (DPCCC) and Sahar were recovered from the assessee through MMTC. The assessee in turn recovered these costs from its members. There were certain additional cost for additional staff deputed by the Customs authorities for the above services and claim for the said additional cost was provided in books of account by the assessee but the same was not paid by the assessee as the assessee was contesting that the Government of India deputed extra customs officials and staff over and above agreed strength. It is undisputed that the assessee requested the Government of India to continue with custom clearance facilities at heart of city and agreed to pay for pay and allowance of custom staff and officers deputed to handle sovereign function of customs clearances, appraisal and collection of custom duties etc. The Government of India was regularly monitoring the staff and officer strength required to carry out these sovereign functions for the assessee and its members of diamond and jewellery trade. Based on the increased volume of trade handled through these premises at the Customs Plaza Customs Clearance Centre (DPCCC) and Sahar, the Government of India was deputing add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is brought on record that decision of the Government of India in deploying additional staff and officers is unconscionable or is suffering from perversity. Nothing of that sort is emanating from records and pleadings before us. These functions under the Customs Act, 1962 to be performed by the Government of India are sovereign functions of State and it is the responsibility of the Government of India to properly discharge its duties, obligations and responsibilities as mandated under the Customs Act, 1962. Further, it has now come on record that the outstanding amount payable by the assessee to the Government of India is now recovered by the Government of India through encashment of bank guarantee, the disallowance made by the Assessing Officer, thus, cannot be sustained. For limited verification of the claim of the assessee that the entire liability towards customs stood discharged, we are remitting the matter back to the file of the Assessing Officer for limited verification. Thus, the additions sustained by the learned Commissioner of Income-tax (Appeals) is ordered to be deleted, while relief granted by the learned Commissioner of Income-tax (Appeals) is hereby confirmed, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned Commissioner of Income-tax (Appeals) in applying the principles of mutuality without any such claim filed by the assessee in the return of income filed with the Revenue as well no such claim was raised by the assessee during the assessment stage before the Assessing Officer. The say of the learned Departmental representative is that the learned Commissioner of Income-tax (Appeals) has accepted the said additional claim of the assessee of the principles of mutuality applicable to the assessee which was raised by the assessee for the first time before the learned Commissioner of Income-tax (Appeals) as also wherein additional evidences were submitted by the assessee before the learned Commissioner of Income-tax (Appeals) for the first time, without complying with the requirements of rule 46A(3) of the Income-tax Rules, 1962. It was submitted by the learned Departmental representative that the learned Commissioner of Income-tax (Appeals) did not call for remand report from the Assessing Officer as to his examination and comments on the claim of mutuality raised by the assessee for the first time before the learned Commissioner of Income-tax (Appeals) and fulfilment of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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