SHRI NAMDEO SHIMPI SAMAJ MANDIR ,PUNE vs. ITO, EXEMPTION, WARD-1(2), PUNE, PUNE

The only issue for my consideration is against the addition of Rs.30,41,698/- made by the Assessing Officer for the Voluntary Contribution received during the year by assessee trust which is not registered u/s.12A of the Act.

At the outset, ld. Counsel for the assessee submitted that the alleged sum is corpus donation specifically received for the construction and renovation of old temple and that the donations have been received through cash and cheque specifically for the purpose of construction of building and therefore the same being a capital receipt is not liable to tax. Reliance placed on the decision of Coordinate Bench in the case of T.R. Gupta Public Charitable Trust Vs. CIT (Exemptions) – ITA No.148/Asr/2020 order dated 20.09.2012.

On the other hand, ld. DR submitted that assessee is not registered u/s.12A of the Act, therefore, the Voluntary Contribution deserves to be added as income of the assessee.

I have heard the rival contentions and perused the record placed before me. Admittedly, the assessee is a religious trust and there is temple namely Namdeo Shimpi Samaj Mandir. Assessee is not registered u/s.12A of the Act and the Voluntary Contribution of Rs.30,41,698/- has been received which Revenue authorities are alleging to be voluntary income taxable in the hands of assessee. On the other hand, ld. Counsel for the assessee is contending that it is a capital receipt in the nature of corpus donation voluntarily received from the Members as donation in cash and cheque and the amount has been applied for the building construction. I have gone through the record placed in the paper book running into 28 pages. Page 13 to 17 contains the list of donors who have given the donation in cash and cheque which are specifically for the building construction purpose. In another paper book running into 60 pages, there are affidavits from major donors which are available from pages 41 to 48 of the paper book where the details of the donation in cheque has been mentioned and it has been stated that the donation has been utilized by the trust for the construction of the trust building. Valid receipts have also been issued, audited financial statements are also placed at pages 9 to 12 of the paper book which indicates that during the year Rs.27,51,231/- has been specifically incurred for the building construction work. There is opening balance under the building head at Rs.72,33,405/- and along with the construction during the year, the closing balance of the building is at Rs.99,84,636/-. The fact demonstrated in the paper book as well as the affidavits stands uncontroverted by ld. DR. Now once it has been factually examined that the alleged Voluntary Contribution received during the year at Rs.30,41,698/- is corpus donation specifically meant for the building construction work then it is a capital receipt not liable to tax. For this, I rely on the decision of Coordinate Bench, Amritsar in the case of T.R. Gupta Public Charitable Trust (Supra) where it has been held that even in case of unregistered trust if the donations are given towards the corpus of the trust, then it has to be presumed in the nature of capital receipt not liable to tax. Respectfully following the same and observing that the corpus donation has been received from the donors specifically for the building construction and renovation related to the trust and the same has been carried out during the year. In my considered view, impugned addition deserves to be deleted since it is a capital receipt not liable to be taxed. Finding of ld.CIT(A) is reversed. Grounds of appeal raised by the assessee are allowed.

In the result, the appeal of the assessee is allowed.