THE SYNTHETIC & ART SILKS MILLS RESEARCH ASSOCIATION ,MUMBAI vs. COMMISSIONER OF INCOME TAX (EXEMPTION),, MUMBAI
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Income Tax Appellate Tribunal, MUMBAI BENCH “B” MUMBAI
Before: SHRI OM PRAKASH KANT & SHRI PAVAN KUMAR GADALE
PER OM PRAKASH KANT, AM
This appeal by the assessee is directed against order dated 24.03.2022 passed by the Ld. Commissioner of Income-tax (Exemption), Mumbai [in short ‘the Ld. CIT(E)’] for assessment year 2017-18 holding the assessment order passed by the Assessing Officer as erroneous in so far as prejudicial to the interest of the Revenue.
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The grounds raised by the assessee in appeal are reproduced The grounds raised by the assessee in appeal are reproduced The grounds raised by the assessee in appeal are reproduced as under:
On the facts and in the circumstances of the case and in law, 1. On the facts and in the circumstances of the case and in law, 1. On the facts and in the circumstances of the case and in law, Learned Commissioner of Income Learned Commissioner of Income-tax (Exemptions) (In short, "CIT") n short, "CIT") has erred in invoking revisionary jurisdiction under Section 263 Of has erred in invoking revisionary jurisdiction under Section 263 Of has erred in invoking revisionary jurisdiction under Section 263 Of the Income-tax Act, 1961 (In short, "the Act") when the entire tax Act, 1961 (In short, "the Act") when the entire tax Act, 1961 (In short, "the Act") when the entire assessment order passed by learned Assessing Officer (In short, assessment order passed by learned Assessing Officer (In short, assessment order passed by learned Assessing Officer (In short, (the "AO") is challenged in appeal and pendin (the "AO") is challenged in appeal and pending before learned g before learned Commissioner of Income Commissioner of Income-tax (Appeals) (In short, "CITA"); 2. On the facts and in the circumstances of the case and in law, 2. On the facts and in the circumstances of the case and in law, 2. On the facts and in the circumstances of the case and in law, learned CIT has erred in holding that income should have been learned CIT has erred in holding that income should have been learned CIT has erred in holding that income should have been included to the extent of Rs. 1,71,72,136/ included to the extent of Rs. 1,71,72,136/- under the Head "Income ead "Income from Other Sources" without appreciating (i the nature of receipt, from Other Sources" without appreciating (i the nature of receipt, from Other Sources" without appreciating (i the nature of receipt, and (ii) year of accrual; and (ii) year of accrual; 3. On the facts and in the circumstances of the case and in law, 3. On the facts and in the circumstances of the case and in law, 3. On the facts and in the circumstances of the case and in law, learned CIT has erred in holding that section 11(1) (d) is learned CIT has erred in holding that section 11(1) (d) is learned CIT has erred in holding that section 11(1) (d) is inapplicable when the issue inapplicable when the issue of exemption under section 11 of the of exemption under section 11 of the Act is pending before CITA and the appellant could not have Act is pending before CITA and the appellant could not have Act is pending before CITA and the appellant could not have foreseen that the exemption under section 11 would be denied by foreseen that the exemption under section 11 would be denied by foreseen that the exemption under section 11 would be denied by learned AO. 3. Briefly stated facts of the case are assessee trust is engaged in Briefly stated facts of the case are assessee trust is engaged in Briefly stated facts of the case are assessee trust is engaged in carrying on research activity, predominantly for Ministry of Textile esearch activity, predominantly for Ministry of Textile esearch activity, predominantly for Ministry of Textile ,Government of India and other parties alongwith imparting of ,Government of India and other parties alongwith imparting of ,Government of India and other parties alongwith imparting of education in the field of textile , management etc. The assessee is education in the field of textile , management etc. The assessee is education in the field of textile , management etc. The assessee is registered u/s 12A of Income registered u/s 12A of Income-tax Act, 1961 (in short ‘the Act’) with tax Act, 1961 (in short ‘the Act’) with Income-tax Department as charitable organization. The assessee is tax Department as charitable organization. The assessee is tax Department as charitable organization. The assessee is also registered u/s 35 as an approved research organization. In the also registered u/s 35 as an approved research organization. In the also registered u/s 35 as an approved research organization. In the assessment order passed u/s 143(3) of the dated 18.12.2019, the assessment order passed u/s 143(3) of the dated 18.12.2019, the assessment order passed u/s 143(3) of the dated 18.12.2019, the Assessing Officer held that the assessee was not entitled for Assessing Officer held that the assessee was not entitled Assessing Officer held that the assessee was not entitled exemption u/s 11 of the Act on account of it being covered by the exemption u/s 11 of the Act on account of it being covered by the exemption u/s 11 of the Act on account of it being covered by the proviso to section 2(15) of the Act. Accordingly, invoking section proviso to section 2(15) of the Act. Accordingly, invoking section proviso to section 2(15) of the Act. Accordingly, invoking section
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13(8) of the Act, the Assessing Officer denied exemption u/s 11 of 13(8) of the Act, the Assessing Officer denied exemption u/s 11 of 13(8) of the Act, the Assessing Officer denied exemption u/s 11 of the Act and assessed the total income at Rs.48,69,566/-. the Act and assessed the total income at Rs.48,69,56 the Act and assessed the total income at Rs.48,69,56 Subsequently, the Ld. CIT(E) called for the record and after Subsequently, the Ld. CIT(E) called for the record and after Subsequently, the Ld. CIT(E) called for the record and after examination and verification, he found that the Assessing Officer examination and verification, he found that the Assessing Officer examination and verification, he found that the Assessing Officer did not consider interest of Rs.1,04,75,821/ did not consider interest of Rs.1,04,75,821/- under the head under the head ‘building fund’ and Rs.66,96,315/ ‘building fund’ and Rs.66,96,315/- under the head ‘grand under the head ‘grand-in-aid’ to be spent, which was appearing in the balance sheet, for the be spent, which was appearing in the balance sheet, for the be spent, which was appearing in the balance sheet, for the purpose of the income of the assessee, therefore, the assessment purpose of the income of the assessee, therefore, the assessment purpose of the income of the assessee, therefore, the assessment order was rendered erroneous in so far as prejudicial to the interest order was rendered erroneous in so far as prejudicial to the interest order was rendered erroneous in so far as prejudicial to the interest of the Revenue. The Ld. CIT(E) accordingly, issued notice u/s 263 of of the Revenue. The Ld. CIT(E) accordingly, issued not of the Revenue. The Ld. CIT(E) accordingly, issued not the Act dated 28.02.2022 and asked the assessee as to whether any the Act dated 28.02.2022 and asked the assessee as to whether any the Act dated 28.02.2022 and asked the assessee as to whether any verification of the facts on the issue was carried out by the verification of the facts on the issue was carried out by the verification of the facts on the issue was carried out by the Assessing Officer. Before the Ld. CIT(E), the assessee submitted Assessing Officer. Before the Ld. CIT(E), the assessee submitted Assessing Officer. Before the Ld. CIT(E), the assessee submitted that interest on ‘building fund’ and interest on that interest on ‘building fund’ and interest on ‘unspent grant ‘unspent grant-in- aid’ was kept separately under legal obligation fixed by the aid’ was kept separately under legal obligation fixed by the aid’ was kept separately under legal obligation fixed by the Government Authority specifically for the purpose of the building Government Authority specifically for the purpose of the building Government Authority specifically for the purpose of the building and infrastructure and other grants, and therefore same was not in and infrastructure and other grants, and therefore same was not in and infrastructure and other grants, and therefore same was not in the nature of the income of the assessee fo the nature of the income of the assessee for the year under r the year under consideration. The Ld. CIT(E) after considering the submission of consideration. The Ld. CIT(E) after considering the submission of consideration. The Ld. CIT(E) after considering the submission of the assessee held the assessment order as erroneous in so far as the assessee held the assessment order as erroneous in so far as the assessee held the assessment order as erroneous in so far as prejudicial to the interest of the revenue and directed the Assessing prejudicial to the interest of the revenue and directed the Assessing prejudicial to the interest of the revenue and directed the Assessing Officer to pass a fresh assessment ord Officer to pass a fresh assessment order after carrying out er after carrying out necessary verification. The relevant finding of the Ld. CIT(E) is necessary verification. The relevant finding of the Ld. CIT(E) is necessary verification. The relevant finding of the Ld. CIT(E) is reproduced as under: reproduced as under:
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“4. The submissions of the assessee are carefully considered. The “4. The submissions of the assessee are carefully considered. The “4. The submissions of the assessee are carefully considered. The facts in this case are undisputed. It has not been denied that the facts in this case are undisputed. It has not been denied that the facts in this case are undisputed. It has not been denied that the assessee is directly taking the interest of Rs.1,04,75,821/ directly taking the interest of Rs.1,04,75,821/- under directly taking the interest of Rs.1,04,75,821/ the head "Building Fund" and Rs.66,96.315/ the head "Building Fund" and Rs.66,96.315/- under the head under the head Grant in Aid to be Spent in the Balance Sheet. Regardless of the Grant in Aid to be Spent in the Balance Sheet. Regardless of the Grant in Aid to be Spent in the Balance Sheet. Regardless of the scenario whether the assessee is entitled to exemption or due to scenario whether the assessee is entitled to exemption or due to scenario whether the assessee is entitled to exemption or due to applicability of provisions of Section 2(15) r.w.s. 13(8) of the Act y of provisions of Section 2(15) r.w.s. 13(8) of the Act y of provisions of Section 2(15) r.w.s. 13(8) of the Act exemptions is denied, it was incumbent on the AO to have verified exemptions is denied, it was incumbent on the AO to have verified exemptions is denied, it was incumbent on the AO to have verified during the assessment proceedings whether the gross income of during the assessment proceedings whether the gross income of during the assessment proceedings whether the gross income of the assessee has been reported for computational purposes. In the the assessee has been reported for computational purposes. In the the assessee has been reported for computational purposes. In the present instance as mentioned earlier, the exemption to the nt instance as mentioned earlier, the exemption to the nt instance as mentioned earlier, the exemption to the assessee under Section 11 of the Act has been denied. It is clear assessee under Section 11 of the Act has been denied. It is clear assessee under Section 11 of the Act has been denied. It is clear that once the exemption of the assessee is denied, the income has that once the exemption of the assessee is denied, the income has that once the exemption of the assessee is denied, the income has to be computed under the normal provisions of the Act. As such, the to be computed under the normal provisions of the Act. As such, the to be computed under the normal provisions of the Act. As such, the interest income accrued and earned by the assessee during the nterest income accrued and earned by the assessee during the nterest income accrued and earned by the assessee during the year year year from from from Other Other Other Sources". Sources". Sources". amounting amounting amounting in in in aggregate aggregate aggregate of of of Rs.171.22.136/ Rs.171.22.136/- needed to be assessed under the head Income needed to be assessed under the head Income interest of revenue. The AO has not conducted necessary interest of revenue. The AO has not conducted necessary interest of revenue. The AO has not conducted necessary verifications/enquiries on verifications/enquiries on the Issue and as a result passed an the Issue and as a result passed an order which is erroneous in so far as it is prejudicial to the interest order which is erroneous in so far as it is prejudicial to the interest order which is erroneous in so far as it is prejudicial to the interest of the revenue. 5. Argument of the assessee that interest on building fund arisen 5. Argument of the assessee that interest on building fund arisen 5. Argument of the assessee that interest on building fund arisen during the year forms part of corpus and hence exemption is not during the year forms part of corpus and hence exemption is not during the year forms part of corpus and hence exemption is not acceptable for two reasons. Firstly, the allowability of corpus is ceptable for two reasons. Firstly, the allowability of corpus is ceptable for two reasons. Firstly, the allowability of corpus is governed by the provisions of Section 11(1)(d) of the Act. Secondly. governed by the provisions of Section 11(1)(d) of the Act. Secondly. governed by the provisions of Section 11(1)(d) of the Act. Secondly. there is no applicability of Section 11 of the Act on the computation there is no applicability of Section 11 of the Act on the computation there is no applicability of Section 11 of the Act on the computation of the assessee during the year in view of denial of of the assessee during the year in view of denial of exemptions by exemptions by the AO. Hence, neither the test of Section 11(1)(d) of the Act is the AO. Hence, neither the test of Section 11(1)(d) of the Act is the AO. Hence, neither the test of Section 11(1)(d) of the Act is passed by the assessee nor there can be any question and passed by the assessee nor there can be any question and passed by the assessee nor there can be any question and allowance of corpus in the fund of denial of exemptions. Similarly, allowance of corpus in the fund of denial of exemptions. Similarly, allowance of corpus in the fund of denial of exemptions. Similarly, the interest on unspent grant, the view of the ass the interest on unspent grant, the view of the assessee is that these essee is that these grants are received with specific directions of utilization of specific grants are received with specific directions of utilization of specific grants are received with specific directions of utilization of specific project and accruals on unspent gains are refundable or adjusted project and accruals on unspent gains are refundable or adjusted project and accruals on unspent gains are refundable or adjusted with subsequent grants if any. In this regard, it must be stated that with subsequent grants if any. In this regard, it must be stated that with subsequent grants if any. In this regard, it must be stated that the arguments of the assessee the arguments of the assessee, does not hold much water for the , does not hold much water for the simple reason that under the provisions of the Act, all the income simple reason that under the provisions of the Act, all the income simple reason that under the provisions of the Act, all the income arising or accruing have to be reported for the purpose of taxation arising or accruing have to be reported for the purpose of taxation arising or accruing have to be reported for the purpose of taxation unless they are exempted by the specific provisions of the Act. In unless they are exempted by the specific provisions of the Act. In unless they are exempted by the specific provisions of the Act. In the present case, t the present case, the assessee is duty bound to report the interest he assessee is duty bound to report the interest income on unspent grant and if any refunds has been given back or income on unspent grant and if any refunds has been given back or income on unspent grant and if any refunds has been given back or adjusted against subsequent grant, it is open to the assessee to adjusted against subsequent grant, it is open to the assessee to adjusted against subsequent grant, it is open to the assessee to make the necessary allowance in his computation of income. But make the necessary allowance in his computation of income. But make the necessary allowance in his computation of income. But the mere fact that the interest on unspent grants could be refunded that the interest on unspent grants could be refunded that the interest on unspent grants could be refunded or adjusted does not give the assessee license not to report income or adjusted does not give the assessee license not to report income or adjusted does not give the assessee license not to report income in its computation and directly take it to the balance sheet. The AO in its computation and directly take it to the balance sheet. The AO in its computation and directly take it to the balance sheet. The AO
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has ignored all these aspects and passed an order which is not i has ignored all these aspects and passed an order which is not i has ignored all these aspects and passed an order which is not in consonance with the provisions of the Act. In view of the facts and consonance with the provisions of the Act. In view of the facts and consonance with the provisions of the Act. In view of the facts and circumstances as stated above, I am satisfied that the assessment circumstances as stated above, I am satisfied that the assessment circumstances as stated above, I am satisfied that the assessment order dated 18/12/2019 is erroneous in so far as it is prejudicial to order dated 18/12/2019 is erroneous in so far as it is prejudicial to order dated 18/12/2019 is erroneous in so far as it is prejudicial to the interest of revenue within the meaning of Sect the interest of revenue within the meaning of Section 263 of the Act. ion 263 of the Act. Accordingly, I deem it appropriate to set aside the order dated Accordingly, I deem it appropriate to set aside the order dated Accordingly, I deem it appropriate to set aside the order dated 18/12/2019 18/12/2019 18/12/2019 with with with directions directions directions to to to reframe reframe reframe the the the assessment assessment assessment proceedings as under: proceedings as under: (i) The interest on building fund amounting to Rs. (i) The interest on building fund amounting to Rs. (i) The interest on building fund amounting to Rs. 104,75,821/ 104,75,821/- and the interest on unspent grant and the interest on unspent grant of Rs.66,96,315/ Rs.66,96,315/- aggregating to Rs.171,72,136/-are required are required to be included in the computation of income. to be included in the computation of income. (ii) The AO may conduct necessary verification and grant (ii) The AO may conduct necessary verification and grant (ii) The AO may conduct necessary verification and grant allowance to the assessee on account of expenses, if any allowance to the assessee on account of expenses, if any allowance to the assessee on account of expenses, if any incorporated while earning the impu incorporated while earning the impugned income of Rs. gned income of Rs. 171,72, 136/ 171,72, 136/- under the head 'Income from Other Source". under the head 'Income from Other Source". 6. The AO before framing consequential order is directed to avail 6. The AO before framing consequential order is directed to avail 6. The AO before framing consequential order is directed to avail adequate opportunity to the assessee to present its case. The AO adequate opportunity to the assessee to present its case. The AO adequate opportunity to the assessee to present its case. The AO may further note that the scope of the consequen may further note that the scope of the consequential proceedings is tial proceedings is limited to the issues discussed as above and may not disturb any limited to the issues discussed as above and may not disturb any limited to the issues discussed as above and may not disturb any other findings in the assessment order dated 18/12/2019 or travel other findings in the assessment order dated 18/12/2019 or travel other findings in the assessment order dated 18/12/2019 or travel beyond the scope.” beyond the scope.” 4. Before us, the Ld. Counsel for the assessee filed a Paper Book Before us, the Ld. Counsel for the assessee filed a Paper Book Before us, the Ld. Counsel for the assessee filed a Paper Book containing pages 1 to 328. The Ld. Counsel addressing the ground to 328. The Ld. Counsel addressing the ground to 328. The Ld. Counsel addressing the ground No. 1 of the appeal submitted that the Assessing Officer has No. 1 of the appeal submitted that the Assessing Officer has No. 1 of the appeal submitted that the Assessing Officer has disallowed the entire claim of exemption u/s 11 of the Act and disallowed the entire claim of exemption u/s 11 of the Act and disallowed the entire claim of exemption u/s 11 of the Act and appeal filed against said assessment order by the assessee is appeal filed against said assessment order by the assessee is appeal filed against said assessment order by the assessee is pending before ld first pending before ld first appellate authority i.e. the Commissioner of appellate authority i.e. the Commissioner of Income-tax(Appeals) and therefore, the Ld. CIT(E) was not justified tax(Appeals) and therefore, the Ld. CIT(E) was not justified tax(Appeals) and therefore, the Ld. CIT(E) was not justified in invoking proceedings u/s 263 of the Act during pendency of the in invoking proceedings u/s 263 of the Act during pendency of the in invoking proceedings u/s 263 of the Act during pendency of the appeal before the ld. CIT(A). He referred to Paper Book page NO. 68 appeal before the ld. CIT(A). He referred to Paper Book page NO. 68 appeal before the ld. CIT(A). He referred to Paper Book page NO. 68 which is copy of the Form No. 35 filed before the Ld. CIT(A). The Ld. copy of the Form No. 35 filed before the Ld. CIT(A). The Ld. copy of the Form No. 35 filed before the Ld. CIT(A). The Ld.
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Counsel also referred to Paper Book pages No. 58 and 59 which is a Counsel also referred to Paper Book pages No. 58 and 59 which is a Counsel also referred to Paper Book pages No. 58 and 59 which is a copy of the notice u/s 263 of the Act issued by the Ld. CIT(E). copy of the notice u/s 263 of the Act issued by the Ld. CIT(E). copy of the notice u/s 263 of the Act issued by the Ld. CIT(E).
We have heard rival submission of the parties on the issue i We have heard rival submission of the parties on the issue i We have heard rival submission of the parties on the issue in dispute and perused the relevant material on record. Regarding the dispute and perused the relevant material on record. Regarding the dispute and perused the relevant material on record. Regarding the contention of the Ld. Counsel that during the pendency of the contention of the Ld. Counsel that during the pendency of the contention of the Ld. Counsel that during the pendency of the appeal before the Ld. CIT(A), the Ld. CIT(E) is barred from invoking appeal before the Ld. CIT(A), the Ld. CIT(E) is barred from invoking appeal before the Ld. CIT(A), the Ld. CIT(E) is barred from invoking section 263 of the Act, we feel it appropriate to reproduce the section 263 of the Act, we feel it appropriate to reprod section 263 of the Act, we feel it appropriate to reprod relevant provision of section 263 of the Act as under: relevant provision of section 263 of the Act as under: relevant provision of section 263 of the Act as under: “(с) where any order referred to in this sub “(с) where any order referred to in this sub-section and passed by section and passed by the Assessing Officer had been the subject matter of any appeal the Assessing Officer had been the subject matter of any appeal the Assessing Officer had been the subject matter of any appeal "[filed on or before or after the 1st day of June, 1988], the "[filed on or before or after the 1st day of June, 1988], the powers of powers of the [Principal Commissioner or] Commissioner under this sub the [Principal Commissioner or] Commissioner under this sub the [Principal Commissioner or] Commissioner under this sub- section shall extend and shall be deemed always to have extended] section shall extend and shall be deemed always to have extended] section shall extend and shall be deemed always to have extended] to such matters as had not been considered and decided in such to such matters as had not been considered and decided in such to such matters as had not been considered and decided in such appeal.” 5.1 On perusal of the above provision, it is evi On perusal of the above provision, it is evident that the Ld. dent that the Ld. CIT(E) is barred for invoking section 263 of the Act only when a CIT(E) is barred for invoking section 263 of the Act only when a CIT(E) is barred for invoking section 263 of the Act only when a issue in which he propose to revise the order, has been considered issue in which he propose to revise the order, has been considered issue in which he propose to revise the order, has been considered and decided by the Ld. CIT(A). Thus unless the issue is decided by and decided by the Ld. CIT(A). Thus unless the issue is decided by and decided by the Ld. CIT(A). Thus unless the issue is decided by the Ld. CIT(E), mere pendency of the the Ld. CIT(E), mere pendency of the appeal before Ld. CIT(A), does appeal before Ld. CIT(A), does not bar jurisdiction of the Ld. CIT(E). More so, in the case in hand, not bar jurisdiction of the Ld. CIT(E). More so, in the case in hand, not bar jurisdiction of the Ld. CIT(E). More so, in the case in hand, the issue before the Ld. CIT(A) was in respect of exemption of the the issue before the Ld. CIT(A) was in respect of exemption of the the issue before the Ld. CIT(A) was in respect of exemption of the income u/s 11 of the Act and not as what would be the quantum of income u/s 11 of the Act and not as what would be the quantum of income u/s 11 of the Act and not as what would be the quantum of the income and therefor the income and therefore, issue covered u/s 263 of the Act is e, issue covered u/s 263 of the Act is different from the issue , which is pending before the Ld. CIT(A). In different from the issue , which is pending before the Ld. CIT(A). In different from the issue , which is pending before the Ld. CIT(A). In view of our observation above, the ground No. 1 of the appeal of the view of our observation above, the ground No. 1 of the appeal of the view of our observation above, the ground No. 1 of the appeal of the assessee is dismissed. assessee is dismissed.
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As far as the ground Nos. 2 and 3 of the appeal is As far as the ground Nos. 2 and 3 of the appeal is As far as the ground Nos. 2 and 3 of the appeal is concerned, we find that the Ld. CIT(E) has invoked section 263 of the Act for we find that the Ld. CIT(E) has invoked section 263 of the Act for we find that the Ld. CIT(E) has invoked section 263 of the Act for the reason that no inquiry or verification was carried out by the the reason that no inquiry or verification was carried out by the the reason that no inquiry or verification was carried out by the Assessing Officer regarding the quantum of income to be assessed Assessing Officer regarding the quantum of income to be assessed Assessing Officer regarding the quantum of income to be assessed in the case of the assessee, particularly amoun in the case of the assessee, particularly amount of the interest in t of the interest in respect of interest on building fund and interest on the grand in aid respect of interest on building fund and interest on the grand in aid respect of interest on building fund and interest on the grand in aid to be spent, which was credited directly to the balance sheet. The to be spent, which was credited directly to the balance sheet. The to be spent, which was credited directly to the balance sheet. The Ld. Counsel for the assessee referred to Paper Book page No. 72 , Ld. Counsel for the assessee referred to Paper Book page No. 72 , Ld. Counsel for the assessee referred to Paper Book page No. 72 , which is copy of query letter i which is copy of query letter issued by the Assessing Officer in ssued by the Assessing Officer in assessment proceedings. We find that there is no reference of any assessment proceedings. We find that there is no reference of any assessment proceedings. We find that there is no reference of any questionnaire raised by the Assessing Officer on the issue of questionnaire raised by the Assessing Officer on the issue of questionnaire raised by the Assessing Officer on the issue of inclusion of interest for computation of the income of the assessee inclusion of interest for computation of the income of the assessee inclusion of interest for computation of the income of the assessee for the year under conside for the year under consideration. The Ld. Counsel for the assessee ration. The Ld. Counsel for the assessee further referred to the reply of the assessee to the said further referred to the reply of the assessee to the said further referred to the reply of the assessee to the said questionnaire, which is available on Paper Book pages No. 98 to questionnaire, which is available on Paper Book pages No. 98 to questionnaire, which is available on Paper Book pages No. 98 to 104. On perusal of the same also, we did not find any reference to 104. On perusal of the same also, we did not find any reference to 104. On perusal of the same also, we did not find any reference to inclusion of interest on b inclusion of interest on building fund and grant in aid as income of uilding fund and grant in aid as income of the assessee. The Ld. Counsel for the assessee further submitted the assessee. The Ld. Counsel for the assessee further submitted the assessee. The Ld. Counsel for the assessee further submitted that assessee has already filed balance sheet for the year under that assessee has already filed balance sheet for the year under that assessee has already filed balance sheet for the year under consideration and earlier year, a copy of which is available on paper consideration and earlier year, a copy of which is available on paper consideration and earlier year, a copy of which is available on paper book page No. 42 and 303 respectively and submitted that all 42 and 303 respectively and submitted that all 42 and 303 respectively and submitted that all details were placed before the Assessing Officer and therefore, the details were placed before the Assessing Officer and therefore, the details were placed before the Assessing Officer and therefore, the Assessing Officer has duly considered the quantum of income to be Assessing Officer has duly considered the quantum of income to be Assessing Officer has duly considered the quantum of income to be assessed in the hands of the assessee. We do not accept this assessed in the hands of the assessee. We do not accept this assessed in the hands of the assessee. We do not accept this contention of the Ld. Counsel for the assessee. According to us, the Ld. Counsel for the assessee. According to us, the Ld. Counsel for the assessee. According to us,
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when the balance sheet having details of the interest credited when the balance sheet having details of the interest credited when the balance sheet having details of the interest credited directly to the balance sheet was filed before the AO, then he ought directly to the balance sheet was filed before the AO, then he ought directly to the balance sheet was filed before the AO, then he ought to make inquiry regarding the inclusion of the same for the purpose to make inquiry regarding the inclusion of the same for the purpose to make inquiry regarding the inclusion of the same for the purpose of the computation of the income and not carrying out any such he computation of the income and not carrying out any such he computation of the income and not carrying out any such inquiry or verification, the order of the Assessing Officer is deemed inquiry or verification, the order of the Assessing Officer is deemed inquiry or verification, the order of the Assessing Officer is deemed to be erroneous as per Explanation to be erroneous as per Explanation-2 to section 263 of the Act. to section 263 of the Act. 6.1 In view of the aforesaid discussion, we do not find any In view of the aforesaid discussion, we do not find any In view of the aforesaid discussion, we do not find any infirmity in the order of the Ld. CIT(E) and accordingly , we uphold firmity in the order of the Ld. CIT(E) and accordingly , we uphold firmity in the order of the Ld. CIT(E) and accordingly , we uphold the same. The ground Nos. 2 and 3 of the appeal of the assessee are the same. The ground Nos. 2 and 3 of the appeal of the assessee are the same. The ground Nos. 2 and 3 of the appeal of the assessee are accordingly dismissed. accordingly dismissed. 7. In the result, the appeal filed by the assessee is dismissed In the result, the appeal filed by the assessee is dismissed In the result, the appeal filed by the assessee is dismissed
Order pronounced in the open Cour Order pronounced in the open Court on 29/11/2023. /11/2023. Sd/ Sd/- Sd/- (PAVAN KUMAR GADALE PAVAN KUMAR GADALE) (OM PRAKASH KANT OM PRAKASH KANT) JUDICIAL MEMBER JUDICIAL MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER Mumbai; Dated: 29/11/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. BY ORDER, BY ORDER, //True Copy// (Assistant Registrar) (Assistant Registrar) ITAT, Mumbai ITAT, Mumbai
