K.S.Jhaveri - (1.) By way of these appeals, the appellants have challenged the judgement and order of the Tribunal whereby Tribunal has partly allowed both the appeals of the department as well as assessee.
(2.) This Court while admitting the ITA s No.285/2016, 286/2016, 287/2016, 288/2016 and 289/2016 on 25.04.2017 framed following substantial question of law in each of the appeals:- "Whether under the facts and circumstances of the case the ld. Tribunal was justified in not declaring the reassessment proceedings and the consequential assessment order passed thereto as nullity?"
(3.) However, in view of the decision of this Court in the case of D.B. Income Tax Appeal No.643/2008 dated 25.07.2017 which is binding to both the parties wherein assessee has upheld to be local authority under the Act, reads as under: " In all these appeals common questions of law and facts are involved, hence, they are decided by this common judgement. 1. By way of these appeals, the assessee as well as the department have assailed the judgement and order of the Tribunal whereby the Tribunal has allowed the appeal preferred by the department reversing the view taken by the CIT(A) and in some appeals the appeal of the department was dismissed. 2. This Court while admitting the matter has framed the following questions of law:-"D.B. ITA No. 643/2008 (i) Whether under the facts and circumstances of the case and in law the Tribunal was justified in holding that the expenditure of Rs. 11,74,15,986/- incurred by the assessee is of revenue in nature ignoring that the expenditure was incurred in bringing the inventories to the present location and condition as stipulated in the Accounting Standard-2 of ICAI and therefore are part of closing stock? (ii) Whether under the facts and circumstances of the case and in law the Tribunal was justified in deleting the disallowance made out of depreciation claimed even when it was not claimed on written down value of the asset? (iii) Whether under the facts and circumstances of the case and in law the Tribunal was justified in confirming the order of CIT(A) on the issue wherein the additions of Rs. 18,31,68,938/- made in the value of closing stock was reduced arbitrarily to Rs. 10,87,50,513/-thereby granting a whopping relied Rs. 7,44,18,425/- without appreciating that the value of opening stock has to be taken as closing stock of preceding year?"D.B. ITA No. 73/2011 "Whether on the facts and circumstances of the case and in law, the Ld. ITAT was right in holding that the appellant is not a 'local authority' as contemplated under section 10(20) of the Income Tax Act, 1961 and therefore, it was not exempt from income tax?"D.B. ITA No. 706/2008 (1) Whether under the facts and circumstances of the case and in law the Tribunal was justified in holding that the expenditure of Rs. 11,74,15,986/- incurred by the assessee is of revenue in nature ignoring that the expenditure was incurred in bringing the inventories to the present location and condition as stipulated in the Accounting Standard-2 of ICAI and therefore are part of closing stock? (ii) Whether under the facts and circumstances of the case and in law the Tribunal was justified in deleting the disallowance made out of depreciation claimed even when it was not claimed on written down value of the asset? (iii) Whether under the facts and circumstances of the case and in law the Tribunal was justified in confirming the order of CIT(A) on the issue wherein the additions of Rs. 18,31,68,938/- made in the value of closing stock was reduced arbitrarily to Rs. 10,87,50,513/-thereby granting a whopping relied Rs. 7,44,18,425/- without appreciating that the value of opening stock has to be taken as closing stock of preceding year?"D.B. ITA No. 294/2009 "Whether on the facts and circumstances of the case and in law, the Ld. ITAT was right in holding that the appellant is not a 'local authority' as contemplated under section 10(20) of the Income Tax Act, 1961 and therefore, it was not exempt from income tax?"D.B. ITA No. 326/2009 "(1) Whether on the facts and in the circumstances of the case, Hon'ble ITAT was justified in ignoring the para 6 of the Accounting Standard-2 of ICAI for valuation of inventories to be in consonance with section 145 of the Income Tax Act, 1961? (2) Whether on the law and facts of the case Hon'ble ITAT was justified in deleting the disallowance of the depreciation ignoring the Explanation 6 of Section 43(6) of I.T. Act, 1961 inserted by the Finance Act, 2008 with retrospective effect from 1.4.2003?" "(1) Whether on the facts and circumstances of the case and in law, the Ld. ITAT was right in holding that, the appellant is not a 'local authority' as contemplated under section 10(20) of the Income Tax Act, 1961 and therefore it was not exempt from income tax? (2) Whether on the facts and in circumstances of the case and in law, the Order passed by Ld. ITAT was not perverse, unjust, arbitrary and contrary to material on record? (3) Whether on the facts and circumstances of the case, the appellant is not a State as per Article 12 of the constitution of India and therefore exempt from income tax under Article 289(1) of the Constitution of India? (4) Whether on the facts and circumstances of the case, the Ld. ITAT was correct in law in holding that the appellant is liable to tax under the Income Tax Act, 1961?"D.B. ITA No. 392/2011 (1) Whether under the facts and circumstances of the case, and in law the ld. Tribunal was justified in not upholding the order of the CIT (A) whereby the rental income of Rs. 13,26,069 was treated as "Income from house property" under section 22 as against "business income"? (2) Whether under the facts and in the circumstances of the case, and law the ld. Tribunal was justified in not holding that the deficit of Rs. 1,26,07,674/- on development work in progress being not allowable under section 14A of the Act?" 3. Counsel for the appellant has taken us to the definition of local authority under the Income Tax Act and contended that in view of the proviso added to explanation of Section 10(20) of the Income Tax Act which reads as under:- "Explanation. For the purpose of this clause, the expression "local authority" means (i) Panchayat as referred to in clause (d) of article 243 of the constitution; or (ii) Municipality as referred to in clause (e) of article 243P of the Constitution; or (iii) Municipal Committee and District Board, legally entitled to, or entrusted by the Government with, the control or management of a Municipal or local fund; or (iv) Cantonment Board as defined in section 3 of the Cantonments Act, 1924 (2 of 1924)." ;