Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “B” BENCH : BANGALORE
Before: SHRI GEORGE GEORGE K & SHRI LAXMI PRASAD SAHU
Per George George K, Vice President :
This appeal at the instance of the Revenue is directed against CIT(A)’s order dated 17.08.2023, passed under section 250 of the Income Tax Act, 1961 (hereinafter called ‘the Act’). The relevant Assessment Year is 2016-17.
Brief facts of the case are as follows:
Assessee is a Trust. The assessee Trust was granted registration under section 12A of the Act, vide order dated 10.10.2002. The assessment for Assessment Year 2016-17 was completed under section 144 of the Act (order dated 29.12.2018). The AO held that there was no response to various notices issued, hence, it was concluded by AO that in absence of any details, the expenditure claimed to have been incurred during the relevant financial year could not be verified. Therefore, the gross receipt of assessee Trust amounting to Rs.1,81,68,913/- was taken as the income denying exemption under sections 11 and 12 of the Act.
Aggrieved by the Order of Assessment, assessee filed appeal before the First Appellate Authority (FAA). Before the FAA, it was submitted that assessee Trust was providing services to promote social, economical, educational and cultural activities to the public in general and to establish hostels. It was stated that assessee had maintained regular books of accounts and assessee was statutorily obliged to get its accounts audited under section 12A of the Act. It was submitted that the said statutory audit was caried out and report in Form 10B has been filed along with the return of income on 31.10.2017. It was stated that AO has not taken note of Form 10B and addition of gross income is not justified. The CIT(A) allowed the appeal of the assessee. The CIT(A) held that copy of registration under section 12A of the Act and Form 10B were uploaded along with the return of income. The CIT(A) directed the AO to verify Form 10B and the submission of the assessee. The CIT(A) thereafter asked the AO to examine whether addition is warranted or not. The relevant finding of the CIT(A) in directing the AO to verify the details reads as follows:
“4.4 It is a fact that the appellant trust has been registered under sec 12A of the I T Act. It is submitted by the appellant that the copy of 12A and Form 10B were uploaded along with the return of income. Therefore, the AO is directed to obtain the same from the appellant and after verification the submissions of the appellant are found correct, the addition made is directed to be deleted. The grounds raised on this issue are allowed.”
Aggrieved by the order of the CIT(A), the Revenue has filed the present appeal before the Tribunal. None was present on behalf of the assessee. However, we proceed to dispose off the appeal on merits after hearing the learned DR. The learned DR submitted that CIT(A) has erred in violating Rule 46A of the Income Tax Rules, 1962, by taking into account the additional evidence and deciding the issue in favour of the assessee without providing the AO to verify the additional evidence. The learned DR also submitted that CIT(A) has erred in restoring the matter to the AO.
We have heard the learned DR and perused the material on record. The CIT(A) has not taken any fresh evidence on record. Copy of the registration granted under section 12A of the Act was taken note by the AO in the impugned order passed under section 144 of the Act. Form 10B was also uploaded along with the return of income. Filing of Form 10B has been complied with. On the facts of the instant case, it is clear that assessee had maintained regular books of accounts and the same was statutorily audited by the Chartered Accountant as per the provisions of section 12A of the Act. From perusal of Form 10B which is filed along with the return of income, the AO can discern the activities of the assessee and how the expenses have been incurred. The CIT(A) has only directed the AO to verify the details filed along with the return of income and then come to a conclusion whether on the facts of the instant case, the addition of gross receipts of the assessee Trust is warranted or not. We find the order of the CIT(A) is correct and in accordance with law and no interference is called for. It is ordered accordingly.
In the result, appeal filed by the Revenue is dismissed.