DY.CIT(EXP), BHUBANESWAR vs. M/S. ORISSA COMPUTER ACADEMY, BHUBANESWAR

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ITA 427/CTK/2018Status: DisposedITAT Cuttack28 January 2021AY 2010-1113 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the assessee was entitled to exemption under Sections 11 and 12, following its own prior decisions and the Assessing Officer's subsequent allowance for AY 2015-16. Regarding Section 13 violations, the matter was partly restored for determination of specific amounts.

What were the facts?

The assessee, Orissa Computer Academy, claimed exemption under Section 11 and 12 of the Income Tax Act. The Assessing Officer disallowed this exemption, citing the business-like nature of its activities, exorbitant fees, and alleged violations of Section 13. The CIT(A) had allowed the exemption, but the revenue appealed.

What were the issues?

Whether the assessee's activities constituted business, disentitling it to charitable exemption, and whether payments to certain individuals violated Section 13.

Which sections of the Income-tax Act were involved?

Section 11,Section 12,Section 13,Section 12AA,Section 11(4A),Section 11(5),Section 13(1)(c),Section 13(1)(d)

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Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK

Before: S/SHRI P.M. JAGTAP & C.M. GARG

For Appellant: Shri P.K.Mishra,, AR
For Respondent: Shri M.K.Gautam CIT DR
Pronounced: 28/1/2021

passing appeal effect order dated 24.1.2019, has accepted the claim of the assessee. Hence, the appeal for the assessment year 2010-2011 is dismissed.

8.

Coming to assessment years 2013-14 & 2014-15, there are two issues involved i.e. disallowance of exemption u/s.11 & 12 of the Act and violation of section 13 on the loan to Krupajala Trust.

9.

The CIT (A) following the order of this Tribunal has allowed the exemption u/s.11 & 12 of the Act. Further, following the order of the Hon’ble Delhi High Court in the case of DIT (Exemptions) vs Alarippu, 244 ITR 146(Del) and DIT (Exemptions) vs Acme Educational Society, 326 ITR 146 (Del) has held that the loan given by one charitable society to another society having similar objects cannot be treated as either an investment or a deposit so as to attract the mischief of section 13(1)(d) read with section 11(5) of the Act and following the same, the ld CIT(A) held that there is no violation of section 13 of the Act to deny exemption u/s.11 of the Act.

10.

During the course of hearing, learned representatives of both parties have agreed that the issue is covered by the decision of Hon’ble Delhi High Court and the decision of this Bench in assessee;’s own case (supra).

Hence, we dismiss the appeals filed by the revenue for assessment year 2013-14 & 2014-15.

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M/s. Orissa Computer Academy

11.

The cross objections filed by the assessee are in support of the order of the ld CIT(A). Since, we have dismissed the appeals of the revenue, cross objections have become infructuous and hence, dismissed.

12.

In the result, appeals filed by the revenue and cross objections of the assessee are dismissed.

Order pronounced on 28/1/2021.

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