SRI SHANMUKHANANDA FINE ARTS & SANGEETHA SABHA,MUMBAI vs. DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTIONS), CIRCLE 2, MUMBAI, MUMBAI

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ITA 320/MUM/2026Status: DisposedITAT Mumbai14 May 2026AY 2022-236 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal found that the CIT(A)'s adjudication was based on factual assumptions inconsistent with the records. Therefore, the matter was restored to the CIT(A) for fresh adjudication after proper appreciation of facts and submissions.

What were the facts?

The assessee's appeal challenges the CIT(A)'s order which sustained various additions/disallowances. The primary contention is that the CIT(A) relied on facts and observations not present in the assessment order or submissions made by the assessee.

What were the issues?

Whether the CIT(A) erred by relying on incorrect and non-germane facts not supported by the assessment order or assessee's submissions, vitiating the adjudication.

Which sections of the Income-tax Act were involved?

Section 11(6),Section 11(1)(d),Section 11(5)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH

For Appellant: Shri Paresh Shaparia
For Respondent: Shri Swapnil Choudhari
Hearing: 11/05/2026Pronounced: 14/05/2026

आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid appeal has been filed by the assessee against order dated 20.11.2025 passed by the NFAC for the quantum assessment framed under section 143(3) for the Assessment Year 2022-23, whereby various additions/disallowances made by the Assessing Officer have been sustained.

2 ITA No.320/Mum/2026 Sri Shanmukhananda Fine Arts & Sangeetha Sabha

2.

The principal grievance raised before us by the learned counsel is that while adjudicating the grounds relating to disallowance of depreciation under section 11(6), addition on account of corpus donations under section 11(1)(d) read with section 11(5), and denial of deemed application under Explanation 2 to section 11(1), the learned CIT(A) has proceeded on facts and observations which, according to the assessee, neither emanate from the assessment order nor from the submissions actually advanced before the authorities below. It has been vehemently submitted that several findings recorded by the learned CIT(A) refer to factual aspects, paragraphs and contentions which are alien to the assessee’s case and, therefore, the entire adjudication on these issues stands vitiated on account of consideration of incorrect and non-germane facts.

3.

The learned counsel submitted that in so far as the issue relating to depreciation is concerned, the learned CIT(A) has referred to certain observations allegedly arising from paragraph 5.3 of the assessment order, whereas no such paragraph or factual discussion exists in the assessment order itself. Likewise, in respect of the addition relating to corpus donations, it has been contended that the findings recorded by the learned CIT(A) regarding donor confirmations, unsigned letters and absence of proper directions are not

3 ITA No.320/Mum/2026 Sri Shanmukhananda Fine Arts & Sangeetha Sabha borne out from the actual material placed on record by the assessee. It was further submitted that the assessee had already filed complete details and supporting evidences before the appellate authorities including corpus donation confirmations and related documentary evidences, however, the same have not been appreciated in the proper factual perspective. Similar grievance has also been raised qua denial of deemed application under Explanation 2 to section 11(1), wherein, according to the assessee, the learned CIT(A) has proceeded on an altogether different factual premise unrelated to the claim actually made by the assessee in the return of income and the accompanying Form 9A and audit report.

4.

It has further been brought to our notice that the assessee had also furnished revised computation of income during the course of assessment proceedings in order to correctly determine the taxable income in accordance with the amended provisions applicable from the relevant assessment year, however, the same was not accepted by the authorities below. According to the assessee, the revised computation was merely intended to place the correct legal and factual position on record and did not involve any fresh investigation dehors the material already available before the Assessing Officer.

4 ITA No.320/Mum/2026 Sri Shanmukhananda Fine Arts & Sangeetha Sabha 5. Having considered the rival submissions and upon perusal of the material placed before us, we find that the core grievance raised by the assessee is that the adjudication made by the learned CIT(A) on the impugned issues is founded upon factual assumptions and references which are stated to be inconsistent with the actual assessment records and submissions of the assessee. From the perusal of the appellate order as well as the documents placed before us, it appears that certain factual discrepancies and apparent inconsistencies, as pointed out by the learned counsel, require proper verification and reconsideration at the end of the learned CIT(A). Since the appellate authority is the final fact-finding authority under the Act, in our considered opinion, the issues raised by the assessee require fresh adjudication after proper appreciation of the factual matrix, documents placed on record and submissions advanced by the assessee.

6.

Accordingly, in the interest of substantial justice and fair adjudication, we deem it fit to set aside the impugned order of the learned CIT(A) on the aforesaid issues and restore the matter back to his file for adjudication afresh in accordance with law. The learned CIT(A) shall examine the contentions and evidences furnished by the assessee independently and decide the issues by passing a speaking and reasoned order after affording due and effective opportunity of hearing to the

5 ITA No.320/Mum/2026 Sri Shanmukhananda Fine Arts & Sangeetha Sabha assessee. Needless to clarify, the assessee shall be at liberty to furnish all relevant documents, explanations and judicial precedents in support of its claim, which shall be considered on their own merits and in accordance with law.

7.

In the result, the appeal of the assessee is treated as allowed for statistical purposes.

Order pronounced on 14th May, 2026.

Sd/- Sd/- (PRABHASH SHANKAR) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 14/05/2026 KARUNA, sr.ps

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy//

BY ORDER,

(Asstt. Registrar) ITAT, Mumbai

6 ITA No.320/Mum/2026 Sri Shanmukhananda Fine Arts & Sangeetha Sabha

Initial Date 1. Draft dictated on Sr.PS 2. Draft placed before Sr.PS author

3.

Draft proposed & placed JM/AM before the second member 4. Draft JM/AM discussed/approved by Second Member. 5. Approved Draft comes to Sr.PS/P the Sr.PS/PS S 6. Kept for pronouncement Sr.PS on 7. File sent to the Bench Sr.PS Clerk 8. Date on which file goes to the AR 9. Date on which file goes to the Head Clerk. 10. Date of dispatch of Order. 11. Dictation Pad is enclosed Yes

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