IN THE INCOME TAX APPELLATE TRIBUNAL,RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, AM.

&

DINESH MOHAN SINHA, JM आयकरअपीलस/ं .ITA No.731/RJT/2024 िनधा(cid:15)रणवष(cid:15)

/ Assessment Year: (2023-24)

(Hybrid Hearing)

Association of Consulting Civil VIncome-tax Officer Guj-W-

Engineers, s201-1,Rajkot 360001 Opp. Nest Primary School, Raiya .

Road, Rajkot- 360007 (cid:19)थायीलेखासं./जीआइआरसं./PAN/GIR No.: AACAA3806F (Appellant) (Respondent)

Appellant by : Shri Bakul Ganatra, Ld. AR Respondent by : Shri Abhimanyu Singh Yadav, Ld.Sr.DR Date of Hearing : 13/02 /2025 Date of Pronouncement : 05/05 /2025 आदशे / O R D E R PER DINESH MOHAN SINHA JM;

Captioned appeal filed by assessee pertaining to Assessment Year 2023-24, is directed against order passed by Commissioner Of Income Tax (Appeal), vide order dated 06/08/2024, which in turn arises out of an order passed by the Assessing Officer dated 06/01/2024 u/s

143(3) of the Income Tax Act, 1961.

2. Grounds of Appeals raised by the assessee are as follows: -

1. Erroneous Taxation at Maximum Marginal Rate(MMR)

2. Application of Interest under Sections 234A, 234B, and 234C

3. Brief facts of the Case that the assessee is a regular assessee. It is a mutual association (AOP) working for the common issues of consulting civil engineers. It is a non-trading and a non-profit organization and does not share the income. Thus the rules of mutuality principle are fully applicable to this AOP. It has filed return of income as per above details for the captioned year. The income consists of Interest & other income and therefore, as per present statutory provisions the tax liability is 59,446 for AY 2023-24 which is fully paid. The AO CPC has assessed the income as per the return. Hence as regards the assessment of total income, there is no dispute. However, the AO has levied the tax at 42.744% on total income (MMR) as per enclosed assessment order. The details of tax, interest and fees charged in AO is summarized as under:-

i. The AO CPC has ignored that the assessee being a non-trading, mutual organization without any distribution of income to the members, it has to be taxed at normal rates and not at MMR rates. This is by itself ipso-facto erroneous and hence, there is an appeal before you, Sir. The order is never served to the assessee on 09/01/2024. Based on the above facts, the assessee wants to raise following grounds

4. The appellant filed an appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] challenging the application of MMR, citing the principle of mutuality. The CIT(A), however, dismissed the appeal, upholding the CPC's order.

5. Aggrieved by the order of the CIT(A), the appellant seeks to file this appeal before the Hon'ble Income Tax Appellate Tribunal (ITAT), Rajkot. That the written of process u/s. 143 1 of the Income-tax and tax liability of Rs. 2,89,160/- against the assessee.

6. During the course of hearing, the Learned Appellant Representative (hereinafter to as the “Ld. AR”) of the assessee submitted that, we are consulting Engineers Association having is earned by way of interest income fee for consulting charges and argument of seminar etc. The assessee filed ITR and paid taxes on normal rate. Since our association is non-commercial of nonprofit motive.

1. Factual Background and Nature of the Association The Association of Consulting Civil Engineers (the "Appellant") is a mutual, non- profit association formed exclusively for the benefit and mutual welfare of its members, who are professional civil engineers. The Appellant's activities consist of collecting contributions and fees from its members to cover expenses for mutual services and benefits, in strict adherence to its constitutional objectives. The Appellant has no commercial purpose, no intent to make profit, and except for obtaining special benefits to the members there is no dealing with non- members. Since the members are consulting civil engineers, the appropriate trade & techno-fairs are arranged. From the enclosed final a