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Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Per : Kuldip Singh, Judicial Member:
The appellant, M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust (hereinafter referred to as ‘the assessee’) by filing the present appeal, sought to set aside the impugned order dated 16.03.2023 passed by the National Faceless Appeal Centre(NFAC) [Commissioner of Income Tax (Appeals), Delhi] (hereinafter referred to as CIT(A)] qua the assessment year 2013-14 on the grounds inter-alia that :- “1. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in reopening the assessment u/s 147 by issuing notice u/s 148 of the 1. T. Act, 1961 without appreciating the fact that the reassessment notice u/s 148 was 2 M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust issued upon Kallianji Chaturbhuj Sanatorium Trust which was not in existence at the time of issue of notice as it was amalgamated into the Trust named Kallianji Chaturbhuj And Vijay Cantol Charitable Trust on 28.3.2012.
2. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) has erred in confirming the action of the Assessing Officer in making addition of Rs.9,00,206/-, being Rs.20,206/-on account of Interest other than Interest on Securities and Rs.8,80,000/-on account of Interest on Debentures, without appreciating the fact that the said income was already offered for tax in the hands of the Amalgamated Trust.
3. Your appellant prays that the levy of penalty u/s 271(1) (c) of the Income Tax Act on your appellant for furnishing inaccurate particulars be deleted”
Briefly stated facts necessary for consideration and adjudication of the issues at hand are : the assessee being a charitable trust having PAN - AAATB0539K, whose accounts are being audited under section 12AB of the Income Tax Act, 1961 (for short ‘the Act’), filed its return of income for the year under consideration declaring total taxable income of Rs.3,554/-. However, the Assessing Officer (AO) by initiating the proceedings under section 147/148 re-opened the assessment. After issuing necessary notices to which details/submissions were filed. The AO noticed from the AIR data that the assessee has received interest other than interest and security under section 194A to the tune of Rs.20,206/- and received interest on debentures amounting to Rs.8,80,000/- which has not been included in the gross taxable income. On failure of the assessee to file necessary details the AO proceeded to conclude the assessment under section 144 of the Act. It is also brought on record by the assessee during the assessment proceedings that the present trust has been merged with M/s. Vijay Cantrol Charitable Trust and M/s Bai Fulkorbai Trust in the month of March 2013 but no document has been produced on file by the 3 M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust assessee. The AO thereby proceeded to frame the assessment under section 144 read with section 147 of the Act at the total income of Rs.9,00,206/-.
The assessee carried the matter before the Ld. CIT(A) by way of filing appeal who has confirmed the addition by dismissing the appeal. Feeling aggrieved with the impugned order passed by the Ld. CIT(A) the assessee has come up before the Tribunal by way of filing present appeal.
We have heard the Ld. Authorised Representatives of the parties to the appeal, perused the orders passed by the Ld. Lower Revenue Authorities and documents available on record in the light of the facts and circumstances of the case and law applicable thereto.
Ground No.1 5. Ground No.1 is not pressed, hence the same is dismissed.
Ground No.2 6. Ld. A.R. for the assessee challenging the impugned order passed by the Ld. CIT(A) argued his appeal on merits by contending that the addition of Rs.20,206/- and Rs.8,80,000/- total amounting to Rs.9,00,206 on account of interest other than interest on securities and interest on the debentures respectively has already been offered for tax in the amalgamated trust namely M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust. The Ld. A.R. for the assessee further contended that now addition made in the name of amalgamating trust the assessee in this case amounting to double addition and brought on record the detail of income for the year 4 M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust ending 31.03.2013 showing the addition of Rs.9,00,206/- offered as tax in the hands of amalgamated trust which is extracted as under:
Aforesaid contention raised by the Ld. A.R. for the assessee is prima facie tenable and Ld. D.R. for the Revenue contended that all these facts brought on record by the assessee need to be verified by the AO. I am of the considered view that when assessee M/s. Kallianji Chaturbhuj Sanatorium Trust got already stood amalgamated with M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust prior to reopening proceedings under section 147/148 of the Act and the addition made in the name of erstwhile assessee has also been made in hands of amalgamated trust the addition made in the hands of assessee is not sustainable, however all these facts are required to be verified by the AO.
In view of what has been discussed above present appeal filed by the assessee subject to the verification by the AO to the fact 5 M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust that if the addition of Rs.9,00,206/- made to the income of the assessee has been offered to tax in case of amalgamated trust namely M/s. Kallianji Chaturbhuj And Vijay Cantol Charitable Trust in A.Y. 2013-14 the addition made in this case is not sustainable and as a such required to be deleted.
Resultantly the appeal filed by the assessee is allowed.
Order pronounced in the open court on 25.07.2023.