ANTONY MOTORS P. LTD, NAVI MUMBAI v. ACIT 10(3), MUMBAI

ITA 124/MUM/2010 | 2005-2006
Pronouncement Date: 22-07-2011 | Result: Dismissed

Appeal Details

RSA Number 12419914 RSA 2010
Assessee PAN AAACA4719K
Bench Mumbai
Appeal Number ITA 124/MUM/2010
Duration Of Justice 1 year(s) 6 month(s) 15 day(s)
Appellant ANTONY MOTORS P. LTD, NAVI MUMBAI
Respondent ACIT 10(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 22-07-2011
Appeal Filed By Assessee
Order Result Dismissed
Bench Allotted A
Assessment Year 2005-2006
Appeal Filed On 07-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES A : MUMBAI BEFORE SHRI D. MANMOHAN VICE PRESIDENT AND SHRI R.K.PANDA ACCOUNTANT MEMBER ITA. NO. 124/MUM/2010 ASSESSMENT YEAR 2004-2005 M/S. ANTONY MOTORS PVT. LTD. NAVI MUMBAI 400 701. PAN AAACA4719K VS. ACIT 10 (3) MUMBAI (APPELLANT) (RESPONDENT) FOR APPELLANT : SHRI K. SHIVARAM FOR RESPONDENT : SHRI PKB. MENEN SR. D.R. ORDER PER R.K. PANDA A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED A GAINST THE ORDER DATED 29-10-2009 PASSED BY THE CIT(A)-XXII M UMBAI RELATING TO ASSESSMENT YEAR 2004-2005. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER : 1. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF RS.23 00 728/- UNDER SECTION 80IA ON THE GROUND THAT THE ACTIVITIES OF CLEANING OF BEACHES WITH MECHANIZED SOLID WASTE MANAGEMENT SYSTEM IS NOT ELIGIBLE UNDER SECTION 80IA. 2. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE APPELLANT IS MAINTAINING THE SOLID WASTE MANAGEMENT SYSTEM AS APPROVED BY THE MUMBAI MUNICIPAL CORPORATION WHICH IS THE COMPETENT AUTHORITY TO APPROVE THE SOLID WASTE MANAGEMENT SYSTEM HENCE AS THE APPELLANT HAS SATISFIED ALL TH E CONDITIONS OF 80IA DISALLOWANCE OF CLAIM UNDER SECTION 80IA MAY BE DIRECTED TO BE ALLOWED. 3. WITHOUT PREJUDICE TO ABOVE THE LEARNED CIT(A) ERRED IN OBSERVING THAT APPELLANT HAS FAILED TO PROVIDE THE DETAILS OF MACHINES PURCHASED FOR USING SANITARY WORK WHICH IS FACTUALLY INCORRECT THE DETAILS ARE PART OF SCHEDULE OF BALANCE SHEET ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 2 AND THE BILL WISE DETAILS WERE FILED BEFORE THE ASSESSING OFFICER AND THE COPIES WERE SHOWN TO THE CIT(A) IN THE COURSE OF HEARING HENCE THE OBSERVATION ARE NOT CORRECT AND NO COGNIZANCE CAN BE TAKEN AND DEDUCTION OF RS.23 00 728/- UNDER SECTION 80IA MAY BE DIRECTED TO BE ALLOWED. 3. FACTS NECESSARY FOR THE DISPOSAL OF THE APPEAL ARE STATED IN BRIEF. ASSESSEE-COMPANY WAS PRIMARILY ENGAGED IN THE BUSINESS OF MANUFACTURE REPAIRS AND SERVICING OF BODY OF MOTOR CHASIS AND ENGINEERING PRODUCTS. DURING THE PREVIOUS YEAR RELE VANT TO THE YEAR UNDER CONSIDERATION THE COMPANY APPEARS TO HAVE EN TERED INTO AN AGREEMENT (RENEWAL) WITH THE MUNICIPAL CORPORATION FOR REMOVAL AND TRANSPORTATION OF SOLID WASTE GENERATED ON SEA BEAC HES AT MUMBAI. AS PER THE AGREEMENT THE ASSESSEE WAS TO RENDER SERVI CE OF CLEARING THE WASTE FROM SHIVAJI PARK AND MAHIM BEACHES. ADMITTED LY TENDER SPEAKS OF CLEANING OF THE WASTE GENERATED BY PETTY VENDORS UNAUTHORISED HUTMENT DWELLERS AND OTHER SOURCES LIK E BEACH WALKERS TOURISTS AND VISITORS. AT TIMES TIDAL WAVES BRING B ACK A LOT OF FLOATING AND OTHER WASTE TO THE BEACHES. THE ASSESSEE-COMPAN Y WAS ASSIGNED THE TASK OF COLLECTING THE WASTE ON THE BEACHES AND TO DUMP IT IN THE NOTIFIED SITES ON THE BEACHES WHICH IN TURN WOULD B E COLLECTED BY THE MUNICIPAL CORPORATION AUTHORITIES. 4. ACCORDING TO THE ASSESSEE-COMPANY INCOME EARNE D FROM THE MUNICIPAL CORPORATION IS REFERABLE TO THE WORK CARRIED OUT IN THE PROCESS OF SOLID WASTE MANAGEMENT AND THUS IT IS EN TITLED TO CLAIM DEDUCTION UNDER SECTION 80IA OF THE ACT; IN ORDER T O ENCOURAGE AN ENTERPRISE ENGAGED IN INFRASTRUCTURE DEVELOPMENT ET C. DEDUCTION IN RESPECT OF PROFITS AND GAINS DERIVED THEREFROM IS PERMITTED. AS PER SECTION 80IA OF THE ACT WHERE THE GROSS TOTAL INCO ME OF AN ASSESSEE INCLUDES ANY PROFITS AND GAINS DERIVED BY AN UNDERT AKING OR AN ENTERPRISE - FROM ANY BUSINESS REFERRED TO IN SUB-S ECTION 4 OF SECTION 80IA - SUCH ASSESSEE IS PERMITTED TO CLAIM DEDUCTIO N OF AN AMOUNT EQUAL TO 100% OF THE PROFITS AND GAINS FROM SUCH BU SINESS FOR TEN CONSECUTIVE ASSESSMENT YEARS. WE ARE CONCERNED HERE IN WITH THE ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 3 EXPLANATION TO SECTION 80IA (4) OF THE ACT WHEREIN THE EXPRESSION INFRASTRUCTURE FACILITIES WAS DEFINED. SUB-CLAUSE (C) THEREOF TAKES INTO ITS AMBIT SOLID WASTE MANAGEMENT SYSTEM. IN SPIRED BY THE DEFINITION GIVEN IN THE MUNICIPAL SOLID WASTES (MAN AGEMENT AND HANDLING) RULES 2000 THE ASSESSEE-COMPANY CLAIMED DEDUCTION UNDER SECTION 80IA ON THE GROUND THAT THE ASSESSEE- COMPANY IS RENDERING THE SERVICES FOR AND ON BEHALF OF MUNICIP AL CORPORATION OF MUMBAI AND HENCE THE SYSTEM DEVISED BY THE ASSESSEE -COMPANY SHOULD BE CONSIDERED WITHIN THE MEANING OF THE EXPR ESSION SOLID WASTE MANAGEMENT SYSTEM IN WHICH EVENT DEDUCTION IS PERMISSIBLE UNDER SECTION 80IA OF THE ACT ON THE PROFITS EARNED THEREON. 5. IT MAY BE NOTED HERE THAT DURING THE ASSESSMENT PROCEEDINGS THERE WAS A CONFUSION AS TO WHETHER THE TEN YEARS PERIOD PRESCRIBED UNDER SECTION 80IA OF THE ACT HAS COMMEN CED FROM ASSESSMENT YEAR 2004-2005 OR HAD ELAPSED IN THE ASS ESSMENT YEAR 2003-2004. UPON APPRECIATING THE EXPLANATION OF THE ASSESSEE THE ASSESSING OFFICER ADMITTED THAT CLAIM UNDER SECTION 80IA FOR THE ASSESSMENT YEAR 2004-2005 IS MAINTAINABLE SUBJECT TO PROVING THAT THE PROFITS AND GAINS ARE DERIVED FROM THE UTILISAT ION OF SOLID WASTE MANAGEMENT SYSTEM. 6. ADMITTEDLY THE EXPRESSION SOLID WASTE MANAGEM ENT SYSTEM HAS NOT BEEN DEFINED EITHER UNDER THE INCOM E TAX ACT OR ANY OF THE KNOWN ENACTMENTS UNDER INDIAN LAW. THEREFORE GUIDANCE HAS TO BE DERIVED FROM THE COMMON PARLANCE OR COMMERCIA L PARLANCE MEANING OF THE EXPRESSION SOLID WASTE MANAGEMENT S YSTEM IN THE BACKDROP OF GLOBAL CONCERN FOR A CLEAN ENVIRONMENT SOLID WASTE MANAGEMENT IS AN ESSENTIAL PART IN THE PROCESS OF M AINTAINING CLEAN ENVIRONMENT. 7. THE ASSESSING OFFICER OBSERVED THAT THE WORK UN DERTAKEN BY THE ASSESSEE IS NOT RELATED WITH THE SOLID WASTE MANAGEMENT BUT IT WAS LIMITED TO CLEANING OF BEACHES. IN HIS OPINION THE ACTUAL WORK OF ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 4 CLEANING OF BEACHES CANNOT BE EQUATED WITH THE SOLI D WASTE MANAGEMENT AS ENVISAGED UNDER SECTION 80IA OF THE A CT. THEREFORE CLAIM OF DEDUCTION UNDER SECTION 80IA WAS REJECTED BY THE ASSESSING OFFICER. 8. AGGRIEVED IT WAS CONTENDED BEFORE THE LEARNED CIT(A) THAT TO CARRY OUT THE WORK OF CLEANING SEGREGATION TRA NSPORTATION AND DUMPING OF WASTE AT THE SPECIFIED PLACE ASSESSEE-C OMPANY BOUGHT MACHINERY AND EQUIPMENT ARRANGED MAN-POWER AND CR EATED FACILITIES FOR MAINTENANCE OF MACHINES AND THUS THE COMPREHENS IVE ACTIVITY OF THE ASSESSEE CAN BE CONSIDERED AS SOLID WASTE MANA GEMENT ACTIVITY; PROFITS THEREFROM ARE ELIGIBLE FOR DEDUCTION UNDER SECTION 80IA OF THE ACT. ATTENTION WAS INVITED TO SECTION 80IA OF THE A CT TO SUBMIT THAT IN ORDER TO CLAIM DEDUCTION ASSESSEE HAS TO PROVE THAT IT HAS ENTERED INTO AN AGREEMENT WITH THE CENTRAL GOVERNMENT/STATE GOVE RNMENT/LOCAL AUTHORITY/OTHER STATUTORY AUTHORITIES FOR DEVELOPIN G/OPERATING AND MAINTAINING SOLID WASTE MANAGEMENT SYSTEM. IN THE I NSTANT CASE THE ASSESSEE ENTERED INTO AN AGREEMENT WITH THE MUNICIP AL CORPORATION OF BOMBAY AND HAS BEEN CARRYING OUT OPERATIONS OF CLEA NING SOLID WASTE AND TRANSPORTING TO DESIGNATED PLACE. MUNICIPAL SO LID WASTE MANAGEMENT IS UNDERSTOOD BY THE MUNICIPAL CORPORAT ION AS AN ACTIVITY CONCERNING COLLECTION TRANSFER AND TRANSP ORT OF SOLID WASTE. ASSESSEE HAVING FULFILLED THE SCHEME OF FUNCTIONS A S UNDERSTOOD BY THE MUNICIPAL CORPORATION VIS-A-VIS THE MUNICIPAL SOLI D WASTE MANAGEMENT DEDUCTION IS PERMISSIBLE UNDER SECTION 80IA OF THE ACT. 9. LEARNED CIT(A) REJECTED THE CONTENTION OF THE ASSESSEE. IN THIS REGARD HE OBSERVED THAT THE NATURE OF WORK ME NTIONED IN THE WORK ORDER RECEIVED FROM MUNICIPAL CORPORATION OF M UMBAI IS LIMITED TO CLEANING OF BEACHES FROM SHIVAJI PARK TO MAHIM. THERE IS NO DEFINITION OF THE EXPRESSION SOLID WASTE MANAGEMEN T SYSTEM IN THE MUNICIPAL SOLID WASTES (MANAGEMENT AND HANDLING) RU LES 2000. LEARNED CIT(A) APPROVED THE OBSERVATIONS OF THE ASS ESSING OFFICER THAT THE WORK OF CLEANING BEACHES CANNOT BE EQUATED WITH THE SOLID WASTE ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 5 MANAGEMENT SYSTEM. IT APPEARS THAT ASSESSEE HAS GIV EN ITS OWN DEFINITION OF SWM SYSTEM AS A SELF CONTAINED FACIL ITY OF MEN MACHINE AND RESOURCES COMBINING WITH EACH OTHER INCONFORMIT Y OF A COMMON PLAN OF MANAGING SOLID WASTE. IN THIS REGARD LEAR NED CIT(A) OBSERVED THAT THE MUNICIPAL SOLID WASTES (MANAGEMENT AND HAN DLING) RULES 2000 DO NOT REFER TO SECTION 80IA OR VICE-VERSA AND THUS MERE ARRANGEMENT OF SOME UNSKILLED LABOUR FOR CLEANING W ORK CANNOT BE EQUATED TO DEVELOPMENT OF FULL FLEDGED SOLID WASTE MANAGEMENT SYSTEM. HE ALSO DOUBTED THE CLAIM OF THE ASSESSEE W ITH REGARD TO USE OF THE PLANT AND MACHINERY EQUIPMENT ETC. STATED T O BE PURCHASED BY THE ASSESSEE FOR THE PURPOSE OF CLEANING THE BEACHE S. IN THIS REGARD HE OBSERVED THAT THE ASSESSEE FAILED TO PROVIDE THE DETAILS OF MACHINES PURCHASED FOR BEING USED IN THE SANITATION WORK. RE GARDING THE ASSESSEES CLAIM THAT IT HAS PURCHASED THE MACHINER Y BY TAKING FINANCE FROM BANK LEARNED CIT(A) STATED THAT THE A SSESSEE WAS ALSO INVOLVED IN OTHER BUSINESS AND PROFITS AND LOSS ACC OUNT DOES NOT SHOW ANY EXPENDITURE ON ACCOUNT OF MAINTENANCE OF MACHIN ERY APART FROM THE FACT THAT THE INTEREST PAID ON THE LOAN TAKEN I S NOMINAL. HE THUS CONCLUDED THAT THE CLAIM OF PURCHASE OF MACHINERY F OR THE PURPOSE OF CLEANING OF BEACHES IS NOT SUPPORTED BY ANY EVIDENC E. 10. FURTHER AGGRIEVED ASSESSEE IS IN APPEAL BEFOR E US. LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSE E REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER AS WE LL AS THE CIT(A). ASSESSEE-COMPANY FILED TWO PAPER BOOKS. ADVERTING O UR ATTENTION TO THE RELEVANT PAGES LEARNED COUNSEL SUBMITTED THAT THE NATURE OF WORK CARRIED OUT BY THE ASSESSEE WOULD FALL WITHIN THE B ROADER SPECTRUM OF SOLID WASTE MANAGEMENT. EXPLAINING FURTHER IT WA S CONTENDED THAT THE ASSESSEE-COMPANY ENTERED INTO A CONTRACT WITH T HE MUNICIPAL CORPORATION OF GREATER MUMBAI WHEREBY THE COMPANY W AS ASSIGNED THE JOB OF CLEANING SOLID WASTES FROM SHIVAJI PARK TO MAHIM BEACHES. AS PER THE AGREEMENT THE CONTRACT OF CLEANING OF B EACHES INCLUDES COLLECTION OF WASTE GENERATED ON ACCOUNT OF USE OF BEACHES BY PETTY ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 6 VENDORS UNAUTHORISED HUTMENT DWELLERS AND OTHER SO URCES (INCLUDING WASTE REACHING THE BEACH DURING HIGH TIDES) AND IT SHOULD BE DUMPED AT A PLACE AS SPECIFIED IN THE TENDER. PAGE 88 OF T HE PAPER BOOK IS THE LETTER ADDRESSED TO THE ASSESSING OFFICER ABOUT THE NATURE OF ACTIVITY CARRIED ON BY THE ASSESSEE. PAGE 85 REFERS TO DECLA RATION OF ASSESSEE- COMPANY WITH REGARD TO IMPORT OF SPARES OF EQUIPMEN T USED FOR BEACH CLEANING. PAGE-86 REFERS TO DESCRIPTION OF FRONT-EN D LOADER RECEIVED FROM EICHER TRACTORS. PAGES 89 TO 95 OF THE PAPER B OOK REFERS TO THE OLD AGREEMENT FOR CLEANING OF SHIVAJI PARK TO MAHIM BEACHES. THIS CONTRACT IS OPERATIVE FROM 1 ST MARCH 2001 TO 1 ST MARCH 2003. AGREEMENT STATES THAT THE CONTRACTOR SHALL PROVIDE ALL LABOUR MATERIAL IMPLEMENTS AND MACHINERY NECESSARY FOR CARRYING ON THE WORKS. PAGE 96 IS THE WORK ORDER WHICH SHOWS THAT THE CLEANING WORK FROM SHIVAJI PARK TO MAHIM BEACH WILL BE DONE EITHER BY USING BE ACH CLEANING MACHINES OR MANUALLY AS PER SPECIFICATIONS MENTION ED IN THE TENDER DOCUMENT. IT WAS ALSO MENTIONED THAT THE ASSESSEE H AS TO DEMONSTRATE THE MACHINES IMMEDIATELY. PAGES 97 TO 9 9 REFERS TO THE NATURE OF MACHINES USED BY THE ASSESSEE. AS COULD B E NOTICED FROM PAGE 100 OF THE PAPER BOOK THE WORK OF CLEANING BE ACHES SHOULD BE DONE BY MACHINES AND/OR SUPPLEMENTED BY MANUAL METH OD. THE WORK INCLUDES CLEANING OF THE BEACHES UPLOADING OF REFU SE IN THE DUMPER/CONTAINERS AND TRANSPORTING THE SAME TO THE DESIGNATED DISPOSAL SITES OF MCGM OR ANY OTHER DISPOSAL SITE I N OPERATION. AS PER THE ENGINEERS INSTRUCTIONS ASSESSEE HAS TO PREPARE A DAILY WORK PERFORMANCE REPORT. HE HAS TO SEGREGATE THE WASTE O N THE SPOT AND ARRANGE FOR ITS DISPOSAL THROUGH RECYCLING. ONLY BI ODEGRADABLE MUNICIPAL SOLID WASTE HAS TO BE TRANSPORTED TO DISP OSAL SITE FOR FINAL DISPOSAL ON THE SAME DAY. MINISTRY OF ENVIRONMENT AND FORESTS ISSUED NOTIFICATION DATED 25 TH SEPTEMBER 2000 IN EXERCISE OF THE POWERS CONFERRED UNDER THE ENVIRONMENT (PROTECTION) ACT 1985. ACCORDINGLY MSW ( M & H) RULES 2000 WERE FRAMED. ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 7 11. IT MAY BE NOTICED HERE THAT THE MINISTRY OF EN VIRONMENT AND FORESTS APPEARS TO HAVE DRAWN A LINE BETWEEN TH E ACTIVITY PF MANAGEMENT AND HANDLING. BEFORE WE PROCEED TO A NALYSE THE DEFINITION GIVEN IN THE MSW ( M & H) RULES 2000 AN D THE REPORT OF THE ENVIRONMENTAL AUDIT OF MSW MANAGEMENT AS WELL AS WO RLD BANK IT MAY BE APPROPRIATE TO EXTRACT THE DEFINITION OF SO LID WASTE MANAGEMENT. PROVIDED IN THE NATIONAL SOLID WASTE M ANAGEMENT ACT OF JAMAICA : SOLID WASTE MANAGEMENT INCLUDES (A) THE SYSTEMATIC CONTROL OF THE GENERATION COLLECTION SEPARATION STORAGE REUSE RECYCLING TRANSPORTATI ON TRANSFER TREATMENT AND DISPOSAL OF SOLID WASTE; A ND (B) THE CHARACTERISATION AND MEASUREMENT OF SOLID WASTE; 12. PAGE 137 OF THE PAPER BOOK ALSO PROVIDES A SIM ILAR MEANING TO THE EXPRESSION SOLID WASTE MANAGEMENT. IN THEIR OPINION SOLID WASTE MANAGEMENT MEANS - MANAGEMENT OF SOLID WASTE IS ASSOCIATED WITH THE CONTROL OF GENERATION STORAGE COLLECTION TRANSFER AND TRANSPORT PROCESSING AND DISPOSAL OF SOLID WASTES IN A MANNE R THAT IS IN ACCORD WITH THE BEST PRINCIPLES OF PUBLIC HEA LTH ECONOMICS ENGINEERING CONSERVATION AESTHETICS A ND OTHER ENVIRONMENTAL CONSIDERATIONS. 13. PAGES 139 TO 143 APPEARS TO BE THE SUGGESTIONS MADE BY THE WORLD BANK IN ITS DEVELOPMENT STUDIES. AT PAGE 142 UNDER THE CAPTION SOLID WASTE MANAGEMENT SYSTEM THEY HAVE DEFINED SOLID WASTE AS A NON-LIQUID MATERIAL THAT NO LONGER HAS ANY VALUE TO THE PERSON WHO IS RESPONSIBLE FOR IT BUT IN CONTRAST TO THE DEFINITION OF A SOLID WASTE EXPLAINING THE TIPICAL WASTE MANAGEMEN T SYSTEM IT WAS STATED THAT APART FROM COLLECTION SEGREGATION REU SE ETC. OF SOLID ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 8 WASTE IT INVOLVES MAKING POLICIES AS WELL AS SETTIN G ENFORCEMENT STANDARDS AND REGULATIONS BY CARRYING OUT PUBLIC OP INION AND AWARENESS PROGRAMMES IMPLEMENTING COST RECOVERY SY STEM ETC. THE STUDY ALSO REFERS TO TAX HOLIDAY FOR THE PROJECTS E NGAGED IN SOLID WASTE MANAGEMENT. DEPARTMENT OF ECONOMIC AFFAIRS MINISTR Y OF FINANCE EXPRESSED ITS CONCERN (PAGES 144 TO 151) WITH REGAR D TO THE SOLID WASTE GENERATED DAILY IN THE COUNTRY. THIS PAPER RE FERS TO THE RESPONSIBILITY OF THE MUNICIPAL CORPORATION BY TAKI NG UP THE ROLE OF A REGULATOR IN ENSURING CLEAN ENVIRONMENT. THE GOVERN MENT HAS ALSO NOTICED THE IMPORTANCE OF PRIVATE PARTICIPATION IN THIS SECTOR. 14. AS HAS BEEN STATED EARLIER MSW ( M & H) RULES 2000 DID NOT DEFINE THE EXPRESSION SOLID WASTE MANAGEMENT S YSTEM. SUB-RULE (7) PROVIDES FOR THE METHOD OF MANAGING AND HANDLIN G MUNICIPAL SOLID WASTES GENERATED IN A CITY OR A TOWN. THIS SUB-RULE INTURN REFERS TO SCHEDULE-II. A PLAIN READING OF THE PARAMETERS OF C OMPLIANCE AND CRITERIA MENTIONED IN SCHEDULE-II SHOW THAT THE E XPRESSION MANAGEMENT INVOLVES NOT ONLY COLLECTION SEGREGAT ION STORAGE TRANSPORTATION PROCESSING AND DISPOSAL OF SOLID WA STE BUT ALSO THE STEPS TO BE TAKEN BY THE MUNICIPAL AUTHORITIES TO P ROHIBIT LITTERING AND FACILITATE COMPLIANCE BY DEVISING VARIOUS METHODS. FOR EXAMPLE MUNICIPAL AUTHORITIES SHALL CREATE AWARENESS PROGRA MMES FOR SEGREGATION OF WASTE DIRECT PUBLIC NOT TO BURN DRY LEAVES IDENTIFY THE LANDFILL SITES FOR DISPOSAL OF NON-BIODEGRADABLE WA STES. THE EXPRESSIONS OPERATOR OF A FACILITY AND PROCESSIN G WERE DEFINED IN RULE 3 (XVI) AND (XVIII) AS UNDER : (XVI) OPERATOR OF A FACILITY MEANS A PERSON WHO OWNS OR OPERATES A FACILITY FOR COLLECTION SEGREGATION ST ORAGE TRANSPORTATION PROCESSING AND DISPOSAL OF MUNICIPA L SOLID WASTES AND ALSO INCLUDES ANY OTHER AGENCY APPOINTED AS SUCH BY THE MUNICIPAL AUTHORITY FOR THE MANAGEMENT AND HANDLING OF MUNICIPAL SOLID WASTES IN THE RESPECTIV E AREAS. ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 9 (XVIII) PROCESSING MEANS THE PROCESS BY WHICH SOL ID WASTES ARE TRANSFORMED INTO NEW OR RECYCLED PRODUCT S; 15. IT APPEARS THAT POWER TO CONTROL GENERATION OF WASTE IS AN ESSENTIAL ATTRIBUTE SO AS TO CONSIDER THE SAME AS A MANAGEMENT ACTIVITY. POWER TO IMPOSE CERTAIN PROHIBITIONS ON THE PUBLIC - VIS--VIS LITTERING OF WASTE - AND EDUCATING THE PUBLIC ABOUT THE NEED FOR SEGREGATION USE OF BIO-DEGRADABLE ITEMS FOR MAINTA INING CLEAN ENVIRONMENT IS ALSO AN ESSENTIAL ACTIVITY OF MANAGE MENT WHEREAS CLEANING OF THE BEACHES AS PER THE SPECIFICATIONS O F THE MUNICIPAL AUTHORITIES AND UPON SEGREGATION PLACING IT AT AN APPROPRIATE PLACE TO ENABLE THE MUNICIPAL AUTHORITIES TO TRANSPORT TH E SAME TO THE PLACE OF DISPOSAL MAY FALL IN THE CATEGORY OF HANDLING O F WASTE SIMPLICITER. 16. RULE 4 (2) FACILITATES MUNICIPAL AUTHORITY OR AN OPERATOR TO SET UP WASTE PROCESSING AND DISPOSAL FACILITY IN O RDER TO COMPLY WITH THE IMPLEMENTATION PROCEDURE LAID DOWN IN SCHEDULE- I. IN TURN SCHEDULE-I REFERS TO SETTING UP/MONITORING THE PERF ORMANCE OF A WASTE PROCESSING AND DISPOSAL FACILITIES IDENTIFICATION/ IMPROVEMENT OF EXISTING LANDFILL SITES OR NEW SITES FOR FUTURE USE . THIS SHOWS THAT THE PRIVATE PARTICIPATION IS LIMITED TO WASTE PROCESSIN G AND DISPOSAL AND IT DOES NOT EXTEND TO ORGANISING AWARENESS PROGRAMMES OR IMPLEMENTING THE PROHIBITION OF LITTERING OF WASTE ETC. 17. AN ANALYSIS OF THESE RESEARCH REPORTS/RULES A S WELL AS NATIONAL WASTE MANAGEMENT ACT OF JAMAICA SHOWS THAT MANAGEMENT IS A LARGER SPECTRUM WHICH INCLUDES ADMINISTRATIVE AND PLANNING FUNCTIONS WHICH ARE MORE IMPORTANT THAN THE MERE D ISPOSAL OF SOLID WASTES. COLLECTION OF WASTE IS ONLY A SPEC OF THE W HOLE SPECTRUM OF THE SWM SYSTEM. IN OTHERWORDS COLLECTION AND DEPOSITIN G OF WASTES IN ISOLATION WILL NOT PASS MUSTER TO BE CALLED AS SO LID WASTE MANAGEMENT ACTIVITY. ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 10 18. WORLD BANK THROUGH ITS DEVELOPMENT STUDIES E XPRESSED THAT WASTE GENERATED BY PUBLIC CAN POSE A RISK TO T HE ENVIRONMENT AND TO PUBLIC HEALTH AND AS AN ESSENTIAL PART OF PROTEC TING ENVIRONMENT EMPHASIS HAS TO BE GIVEN BY THE GOVERNMENTS TO EFFE CTIVELY MONITOR THE WAYS AND MEANS OF REDUCTION OF SOLID WASTES. IN THEIR STUDY THEY HAVE DEFINED SOLID WASTE AND ALSO EXPLAINED THE WAS TE MANAGEMENT SYSTEM AS INCLUDING CLEANING OF PUBLIC PLACE COLLE CTION TRANSPORT AND TREATMENT OF SAID WASTE. THEY HAVE ALSO OPINED THAT STORAGE COLLECTION TRANSPORT AND TREATMENT OF SOLID WASTE IS JUST ONE OF THE ACTIVITIES OF SOLID WASTE MANAGEMENT; EQUALLY IMPOR TANT REQUIREMENTS ARE (A) MAKING POLICIES (B) EVALUATING DATA OF WAST E GENERATION AND CHARACTERISATION (C) TRAINING PERSONNEL (D) CREATIN G PUBLIC AWARENESS (E) IMPLEMENTING FINANCIAL MECHANISAMS (F) INCORPOR ATING FORMAL/INFORMAL ELEMENTS OF THE PRIVATE SECTOR AS W ELL AS COMMUNITY BASED ACTIVITIES. 19. A CAREFUL PERUSAL OF THE DEVELOPMENT STUDY REP ORT OF THE WORLD BANK SHOWS THAT AN ACTIVITY CAN BE CONSIDERED AS A SOLID WASTE MANAGEMENT ACTIVITY IN A CASE WHERE AN ORGANISATION INVOLVES ITSELF IN A COMPREHENSIVE ACTIVITY OF NOT ONLY COLLECTION TR ANSPORT AND TREATMENT OF WASTE BUT ALSO PARTICIPATES IN THE POL ICY MAKING SUCH AS (A) STEPS TAKEN FOR PROHIBITION OF LITTERING (B) MA KING PUBLIC AWARENESS ETC. A DOMINANT ACTIVITY UNDERTAKEN TO CONTROL SOLI D WASTE IS A SINE QUA-NON FOR BEING CONSIDERED AS A SWM SYSTEM. 20. LEARNED COUNSEL HAS FILED A COPY OF THE ORDER OF THE ASSESSING OFFICER PASSED UNDER SECTION 143 (3) OF THE ACT (ASSESSMENT YEAR 2004-2005) TO SUBMIT THAT THE DEDUCTION CLAIM ED BY THE ASSESSEE WAS ACCEPTED BY THE ASSESSING OFFICER IN T HE SUBSEQUENT YEAR. 21. LEARNED COUNSEL HAS ALSO ADVERTED OUR ATTENTIO N TO PAGES 59 ONWARDS OF THE PAPER BOOK TO SUBMIT THAT THE LIS T OF THE MACHINERY USED BY THE ASSESSEE AND THE RELEVANT BILLS ETC. A RE AVAILABLE ON ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 11 RECORD AND IN FACT THE ASSESSING OFFICER HAD NEVER DISPUTED THE USE OF MACHINERY. SINCE THERE WAS A FACTUAL MISTAKE COMMIT TED BY THE LEARNED CIT(A) ON APPLICATION DATED 4-3-2010 WAS F ILED UNDER SECTION 154 OF THE ACT (PAGES 129 AND 130 OF THE PAPER BOOK ). IN SHORT THE PLEA OF THE LEARNED COUNSEL IS THAT THE ACTIVITY CA RRIED ON BY THE ASSESSEE-COMPANY WAS APPROVED BY THE MUNICIPAL ENGI NEERS AND HENCE THE INCOME TAX DEPARTMENT CANNOT ASSUME THE R OLE OF A MUNICIPAL ENGINEER TO HOLD THAT IT WAS NOT A SOLID WASTE MANAGEMENT ACTIVITY. THE CLEANING WORK INVOLVES A COMPREHENSIV E PROCESS OF COLLECTION SEGREGATION TRANSPORTATION AND DUMPING OF WASTE IN A SYSTEMATIC MANNER. IN THE ABSENCE OF A DEFINITION O F SOLID WASTE MANAGEMENT UNDER INCOME TAX ACT THE MEANING ASSI GNED TO THE WORD SOLID WASTE MANAGEMENT UNDER THE MSW (MANAGE MENT AND HANDLING) RULES 2000 SHOULD BE ADOPTED AND AS PER THE SAID RULES COLLECTION TRANSPORTATION AND DISPOSAL OF SOLID WA STE ARE THE MAIN COMPONENTS OF SOLID WASTE MANAGEMENT (SWM) AND ONCE THESE ESSENTIAL SERVICES ARE PROVIDED AN ASSESSEE IS ENT ITLED TO CLAIM DEDUCTION UNDER SECTION 80IA OF THE ACT. IF THERE I S ANY DISPUTE WITH REGARD TO THE CORRECT MEANING TO BE ASSIGNED TO THE EXPRESSION SOLID WASTE MANAGEMENT SYSTEM THE COURTS SHOULD NOT EMBA RK UPON THE TASK OF ANALYSING THE TECHNICAL MEANING OF THE SAID EXPRESSION AND INSTEAD SUCH ISSUES SHOULD BE ALLOWED TO BE EXAMIN ED BY THE TECHNICAL EXPERTS. PLACING RELIANCE UPON THE DECISI ON OF THE APEX COURT IN THE CASE OF CIT VS. BHARATI CELLULAR LTD. 330 IT R 239 IT WAS CONTENDED THAT IN THE CASE OF ANY DISPUTE WITH REGA RD TO CORRECT MEANING TO BE ASSIGNED TO THE EXPRESSION SOLID WAS TE MANAGEMENT THE MATTER CAN BE REMANDED TO THE FILE OF THE ASSES SING OFFICER SO AS TO ENABLE HIM TO CONSULT TECHNICAL EXPERTS FOR ARRIVIN G AT AN APPROPRIATE CONCLUSION. 22. ON THE OTHER HAND LEARNED DR STRONGLY RELIED UPON THE ORDERS PASSED BY THE TAX AUTHORITIES. IT WAS ALSO C ONTENDED THAT THERE IS NO EVIDENCE ON RECORD TO PROVE THE NATURE OF ACT IVITIES CARRIED ON BY ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 12 THE ASSESSEE I.E. WHETHER WASTE COLLECTED WAS MANU AL OPERATION OR A MECHANICAL OPERATION. 23. JOINING THE ISSUE LEARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT AT THE TIME OF ACCEPTA NCE OF TENDERS ASSESSEE HAS TO SHOW THE AVAILABILITY OF MACHINES A ND IN FACT IT WAS NEVER DISPUTED BY THE ASSESSING OFFICER. FURTHER T HE FACTUM OF CARRYING ON THE ACTIVITY OF CLEANING THE BEACHES WA S NEVER DISPUTED BY THE MUNICIPAL AUTHORITIES AND HENCE ASSESSING OFFIC ER CANNOT PUT HIMSELF IN THE SHOES OF THE MUNICIPAL AUTHORITIES F OR RE-VERIFICATION OF THE NATURE OF THE ACTIVITY. 24. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFU LLY PERUSED THE RECORD. AS RIGHTLY POINTED OUT BY THE L EARNED COUNSEL APPEARING ON BEHALF OF THE ASSESSEE THE EXPRESSION SOLID WASTE MANAGEMENT SYSTEM WAS NOT DEFINED UNDER THE INCOME TAX ACT OR IN ANY OF THE KNOWN INDIAN ENACTMENTS AND HENCE WE HA VE TO TAKE INTO CONSIDERATION THE COMMON PARLANCE MEANING OR THE CO MMERCIAL PARLANCE MEANING OF THE SAID EXPRESSION. 25. IN THE CASE OF TAJMAHAL HOTELS 82 ITR 44 THE A PEX COURT OBSERVED THAT WHERE A WORD IS NOT DEFINED IN STATUT E IT MUST BE CONSTRUED IN ITS POPULAR SENSE I.E. THAT SENSE WHI CH PEOPLE CONVERSANT WITH THE SUBJECT MATTER WITH WHICH THE STATUTE IS DEALING WOULD ATTRIBUTE TO IT. SIMILARLY IN THE CASE OF SP JAIN VS. KRISHNAMOHAN GUPTA (1987) 1 SCC 9 THE COURT OBSERVE D THAT IN THE MATTER OF INTERPRETATION A PRAGMATIC VIEW HAS TO B E TAKEN BY RESPONDING TO THE PURPOSE FOR WHICH IT WAS MADE. IN THE CASE OF S.P. GUPTA VS. UNION OF INDIA (1981) SUPPL. SCC 87 COURT OBSERVED THAT A SECTION ENACTED HALF A CENTURY AGO SHOULD BE UNDERS TOOD IN THE PRESENT DAY CONTEXT; A MEANING OF AN EXPRESSION CAN NOT REMAIN STATIC SINCE INTERPRETATION OF A PROVISION MUST KEEP PACE WITH THE CHANGING CONCEPTS AND VALUES. SINCE LAWS ARE INTENDED TO SER VE A SOCIAL PURPOSE IT CANNOT BE INTERPRETED WITHOUT TAKING IN TO ACCOUNT THE ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 13 SOCIAL ECONOMIC AND POLITICAL SETTING IN WHICH IT IS INTENDED TO OPERATE. 26. BEARING THE AFOREMENTIONED PRINCIPLES IN MIND WE EMBARK UPON THE ARDUOUS TASK OF GIVING A PROPER MEA NING TO THE EXPRESSION SOLID WASTE MANAGEMENT SYSTEM. WE HAVE CAREFULLY GONE THROUGH THE REPORT OF ENVIRONMENTAL AUDIT OF MUNICI PAL SOLID WASTE MANAGEMENT WORLD BANK INTERNATIONAL DEVELOPMENT ST UDIES POSITION PAPER OF SOLID WASTE MANAGEMENT SECTOR OF INDIA AND RULES FRAMED UNDER THE GUIDANCE OF MINISTRY OF ENVIRONMEN T AND FORESTS ETC. 27. IN OUR CONSIDERED OPINION THE INTENTION OF TH E LEGISLATURE IS TO GIVE A FILLIP TO ANY ENTERPRISE OR AN UNDERTA KING WHICH IS ENGAGED IN THE FIELD OF OPERATING INFRASTRUCTURE FACILITIES SUCH AS SOLID WASTE MANAGEMENT SYSTEM. THE EXPRESSION MANAGEMENT - TE CHNICALLY UNDERSTOOD - IS NOT CONFINED TO THE MERE MANUAL OR MECHANICAL OPERATIONS TO COMPLETE A WORK ASSIGNED TO IT BUT IT INVOLVES PLANNING AND OPERATIONS TO ACHIEVE THE ULTIMATE OBJECTIVE OF MAINTAINING A POLLUTION FREE ENVIRONMENT. IN ORDER TO ACCOMPLISH THE ULTIMATE OBJECTIVE MERE CLEANING OF GARBAGE AND DUMPING AT A SITE STIPULATED BY THE MUNICIPAL CORPORATION IS NOT SUFFICIENT. THIS A SPECT HAS BEEN ANALYSED BY US IN PARAS 9 AND 10 ABOVE. RATHER THAT IS THE BASIC ACTIVITY AND NOT THE DOMINANT PURPOSE IN THE SCHEME OF THINGS. IT IS WELL KNOWN THAT DUMPING OF SOLID WASTE IF CONTINUE D FOR LONG WOULD RESULT IN POLLUTING ENVIRONMENT IN AND AROUND THE D UMPING GROUND. ENVIRONMENTALISTS MAIN CONCERN IS OF CONTROLLING G ENERATION OF SUCH SOLID WASTE. GOVERNMENT OF EVERY COUNTRY HAS TO SPR EAD THE AWARENESS OF ADVERSE EFFECTS OF POLLUTING ENVIRONMENT ON ACCO UNT OF LITTERING; IN PARTICULAR NON-SEPARATION OF BIO-DEGRADABLE SOLID WASTE AND NON- BIODEGRADABLE WASTE OR LITTERING SUCH WASTE AT ANY PLACE OF THEIR CHOICE WOULD ALSO CAUSE HARDSHIP TO THE ORGANISATIO NS CONCERNED WITH CONTROLLING THE MENACE. THEREFORE STRICT MEASURES ARE REQUIRED TO BE TAKEN AND IT IS NOT POSSIBLE FOR THE GOVERNMENT AGE NCIES ALONE TO ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 14 COLLECT AND TREAT THE HUGE LUMP OF WASTE GENERATED EVERYDAY. THEREFORE IT WAS THOUGHT FIT TO ENCOURAGE PRIVATE PARTICIPATION BY GIVING THEM CERTAIN INCENTIVES IN THE FORM OF TAX D EDUCTIONS ETC. HOWEVER UNDER THE INCOME TAX ACT SUCH BENEFIT IS E XTENDED TO SOLID WASTE MANAGEMENT SYSTEM ONLY. IN OUR OPINION THE L EGISLATURE HAS CONSCIOUSLY NOT EXTENDED THE BENEFIT TO AGENCIES WH O ARE MERELY HANDLING A PART OF THE ACTIVITY SUCH AS COLLECTIO N AND STORAGE AT THE STIPULATED PLACE. 28. AS ANALYSED BY US IN THE PRECEDING PARAS WHEN LANGUAGE OF THE SECTION IS PLAIN AND CLEAR AND CAN BE UNDERS TOOD WITH THE HELP OF THE SURROUNDING CIRCUMSTANCES AND THE SETTING IN WHICH THE EXPRESSION IS USED IT IS NOT NECESSARY TO SEEK OPI NION OF A TECHNICAL EXPERT SINCE JUDICIARY HAS A DUTY TO INTERPRET THE LAWS BY KEEPING IN MIND THE SOCIAL PURPOSE FOR WHICH THE PROVISION HAS BEEN INTRODUCED IN THE STATUTE BOOK. AS COULD BE SEEN FROM THE DEFI NITION IN THE NATIONAL SOLID WASTE MANAGEMENT ACT OF JAMAICA AS W ELL AS THE REPORTS OF THE ENVIRONMENTAL AUDIT OF WORLD BANK DEPARTMENT OF ECONOMIC AFFAIRS (GOVERNMENT OF INDIA) AND ALSO HA VING REGARD TO THE SCHEME SPELT OUT IN MSW ( M & H) RULES 2000 WE HOL D THAT THE ACTIVITY OF THE ASSESSEE I.E. CLEANING THE BEACHES WITHOUT BEING INVOLVED IN CONTROL OF GENERATION DISPOSAL AND PO LICY MAKING CANNOT BE CONSIDERED AS A SOLID WASTE MANAGEMENT ACTIVITY. CONSEQUENTLY ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTIO N 80IA OF THE ACT. 29. LEARNED COUNSEL SUBMITTED THAT THE ASSESSING O FFICER HAVING ACCEPTED THE CLAIM IN THE SUBSEQUENT YEAR A DIFFERENT VIEW SHOULD NOT BE ADOPTED IN THIS YEAR. IN OUR OPINION PRINCIPLES OF RESJUDICATA ARE NOT APPLICABLE TO THE INCOME TAX PR OCEEDINGS. EVEN OTHERWISE THE VIEW TAKEN BY THE ASSESSING OFFICER WITHOUT GIVING DETAILED REASONS FOR SUCH ACCEPTANCE CANNOT BIND A N APPELLATE FORUM. SINCE TECHNICAL/JUDICIAL ANALYSIS OF VARIOU S ORGANISATIONS WITH REGARD TO THE EXPRESSION SOLID WASTE MANAGEME NT SYSTEM WAS TAKEN INTO CONSIDERATION WE ARE UNABLE TO ACCEPT T HE VIEW TAKEN BY ITA.NO.124/MUM/2010 M/S. ANTONY MOTORS PVT. LTD. 15 THE ASSESSING OFFICER IN THE SUBSEQUENT YEAR. WE T HEREFORE REJECT GROUND NOS. 1 AND 2 OF THE ASSESSEE-COMPANY. 30. IN GROUND NO.3 THE ASSESSEE HAS CHALLENGED TH E OBSERVATION OF THE LEARNED CIT(A) WHEREIN IT IS ME NTIONED THAT ASSESSEE HAS FAILED TO PROVIDE THE DETAILS OF MACHI NERY PURCHASED FOR USING SANITARY WORK. 31. AFTER HEARING BOTH THE SIDES WE FIND THE ASSE SSEE HAS INDEED FILED THE DETAILS BEFORE THE ASSESSING OFFIC ER AND ALL THE MACHINERIES WERE SHOWN IN THE BALANCE SHEET. THEREF ORE THIS OBSERVATION OF THE LEARNED CIT(A) IN OUR OPINION IS INCORRECT. HOWEVER THIS IN OUR OPINION BY NO MEANS WILL ENTITLE THE A SSESSEE TO CLAIM THE DEDUCTION UNDER SECTION 80IA OF THE ACT. 32. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS THE 2 2 ND DAY OF JULY 2011. SD/- SD/- (D.MANMOHAN) (R.K.PANDA) VICE PRESIDENT ACCOUNTANT MEMBER MUMBAI DATE 22 ND JULY 2011 VBP/- COPY TO 1. M/S. ANTONY MOTORS PVT. LTD. PLOT NO.A-390/391 TTC ZONE MIDC MHAPE POST GHANSOLI NAVI MUMBAI 400 701. PA N AAACA4719K 2. ACIT 10 (3) MUMBAI 3. CIT(A)-22 MUMBAI. 4. CIT-10 MUMBAI. 5. DR A BENCH 6. GUARD FILE (TRUE COPY) BY ORDER ASST. REGISTRAR ITAT MUMBAI BENCHES MUMBAI.