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Income Tax Appellate Tribunal, SURAT BENCH, SURAT
Before: SHRI MAHAVIR PRASAD & SHRI O. P. MEENA
PER MAHAVIR PRASAD, JUDICIAL MEMBER
This appeal by the Assessee is directed against the order of the Ld. CIT(A)-3, Surat dated 08.03.2017 pertaining to A.Y. 2013-14 and following grounds have been taken:
ITA No. 146/SRT/2018 2 . A.Y. 2013-14 “1. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income-tax (Appeals) has erred in passing ex parte order without providing opportunity of hearing to assessee. The assessee is not in receipt of any notice of hearing issued by learned CIT(A) during the course of appellate proceedings. 2. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Appeals) has erred in confirming the action of assessing officer in disallowing exemption of Rs. 17,00,000/- claimed u/s 11(1)(d) of the IT. Act against Corpus donation received. 3. On the facts and circumstances of the case as well as law on the subject, the learned Commissioner of Income Tax (Appeals) has erred in confirming the action of assessing officer in making disallowance of expenses totaling to Rs. 18,37,542/- incurred during the year towards objects of the trust. 4. It is therefore prayed that above addition made by assessing officer and confirmed by Commissioner of Income-tax (Appeals) may please be deleted. 5. Appellant craves leave to add, alter or delete any ground(s) either before or in the course of hearing of the appeal.”
An application for early hearing was moved by the assessee for Assessment Year 2013-14 as matter was decided by the ld. CIT(A) ex parte.
After considering the application, we allow early hearing and with the consent of both the parties, we consider it proper to hear the appeal on merit as well.
Assessee is Charitable Trust and claimed exemption under section 11(1)(d). The assessee has claimed exemption of Rs.17,00,000/- u/s.11(1)(d) by reporting, in its balance sheet, such amount as donations towards corpus fund. The assessee was asked, vide notice u/s 142(1) dated 16-10-2015, to submit names, addresses and PAN of the donors who donated Rs.50,000/- and above
ITA No. 146/SRT/2018 3 . A.Y. 2013-14 during the year with total amount of donation in each case and also to mention separately such persons who donated for corpus fund, if any. However, no response was received. Subsequently, the assessee was provided many opportunities vide notices u/s 142(1), dated 04-12-2015, 21-12-2015 and order sheet entries dated 03-02-2016 and 15-02-2016 to submit the details called for from time to time. Meanwhile, the assessee was asked, vide notice u/s 142(1) dated 21-12-2015 and again vide order sheet entry dated 03-02-2016, to show cause as to why the exemption claimed u/s 11(1)(d) should not be disallowed as the trust is not registered u/s 12AA. Further, the assessee was categorically asked, vide order sheet entry dated 15-02-2016, that the final opportunity was being provided to represent the case on 26-02-2016 and after that the case would be decided on merits. However, no response is received ' from the assessee till the date. Therefore, the matter is decided on merits.
From the above, it is evident that despite being provided sufficient time and opportunities, the assessee has not submitted any details in respect of amount of Rs.17,00,000/- claimed as donations towards corpus fund. Thus, it is primarily not established that such amount represents any donation and that too towards corpus donation.
Even otherwise also, sections 11, 12 and 13 are special provisions through which benefits of tax exemption are given. These provisions override general provisions of the Act and do not require the assessee to follow normal accounting or commercial principals to determine the income. To avail benefits of these sections, all conditions, as mentioned in the section 12A, must be fulfilled which includes' to get registration u/s 12AA. Thus, it is imperative to get registration u/s 12AA to avail benefits of sections 11, 12 and 13 of the Act.
ITA No. 146/SRT/2018 4 . A.Y. 2013-14 In this case the assessee has not obtained registration u/s 12AA Therefore, it is not entitled to get benefits of section 11, 12 and 13, including exemption u/s.11(1)(d). 7. In view of the above, the exemption claimed u/s.11(1)(d) is disallowed and accordingly, an addition of Rs.17,00,000/- is made to the total income of the assessee.
Thereafter assessee preferred first statutory appeal before the ld. CIT(A). In this case, three notices were sent to the assessee/ appellant but assessee did not appear. In response to the above said notice and matter was decided ex parte by the ld. CIT(A).
In the interest of justice, we set aside this matter back to the file of the ld. CIT(A) with the condition that appellant shall deposit a cost of Rs.10,000/- with the Department as it has been failed to appear before the ld. CIT(A) on given dates and on production of payment of Rs.10,000/- to the Department, ld. CIT(A) will proceed with the appeal and will decide the matter afresh after giving an opportunity of being heard to the assessee. And assessee is also directed to cooperate with the ld. CIT(A) for early disposal of the appeal.
In the result, appeal filed by the Assessee is allowed for statistical purposes.
The order is pronounced by listing the case on the Notice Board under Rule 34(4) of Income Tax Appellate Tribunal Rules, 1963. Sd/- Sd/- (O. P. MEENA) (MAHAVIR PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad: Dated : 15/07/2019 Rajesh
ITA No. 146/SRT/2018 5 . A.Y. 2013-14 Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) – 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER
/ / TRUE COPY / / Deputy/Asstt.Registrar ITAT,Surat