PASIKUDIL TRUST,CUDDALORE vs. ITO, WARD-1, CUDDALORE

Aforesaid appeal by assessee for Assessment Year (AY) 2020-21 arises out of the order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 19-09-2022 in the matter of an intimation dated 30-11-2021 issued by Centralized Processing Center, Bangalore (CPC) u/s. 143(1) of the Act determining income of Rs.10.63 Lacs. In the said intimation, the assessee has been denied exemption u/s 11 / 12 as claimed by the assessee due to the fact that the return of income was filed belatedly on 31.03.2021.

The Ld. CIT(A), considering the provisions of Sec.13(9) as inserted by Finance Act, 2015 w.e.f. 01-04-2016, upheld the denial of 2 - deduction. Aggrieved, the assessee is in further appeal before me wherein limited submissions of Ld. AR that only net income should be brought to tax and not the gross receipts as done by CPC.

After due consideration of case records, I find that the assessee has admitted gross receipts of Rs.10.63 Lacs and incurred administrative expenditure and certain amount has been expanded for charitable purposes. Prima facie, the assessee has earned surplus of Rs.0.18 Lacs which precisely is the argument before me. I am of the considered opinion, in case the deduction is to be denied, only the surplus and not the entire gross receipts should be brought to tax. The Ld. AO is directed to verify the same and re-determine the income of the assessee accordingly.

The appeal stands partly allowed in terms of above order. Order pronounced on 20th February, 2023.