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Income Tax Appellate Tribunal, HYDERABAD
Before: SHRI A. MOHAN ALANKAMONY
IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “B-SMC”, HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA No. 261/Hyd/2019 Assessment Year: 2015-16 DRS Educational Society, Vs. Income Tax Officer, Hyderabad. Ward-10(1), PAN: AAATD 4737 D Hyderabad. (Appellant) (Respondent) Assessee by: Shri Venkatesh for M.V. Anil Kumar Revenue by: Shri Nilanjan Dey – DR Date of hearing: 19/11/2019 Date of pronouncement: 19/11/2019 ORDER
This appeal is filed by the assessee against the order of the Ld. CIT(A)-6, Hyderabad in appeal No. 10229/2017-18/B3/CIT(A)-6, dated 14/09/2018 passed U/s. 143(3) r.w.s U/s. 250(6) of the Act for the A.Y. 2015-16.
The assessee has raised the following grounds in his appeal:-
“1. The Ld. CIT(A) as well as the A.O. erred in law and facts of the case in not considering the admission fees of Rs. 39,64,906 as capital receipts. 2. The Ld. CIT(A) as well as the A.O. ought to have appreciated the fact that the society is non-profit organisation imparting education, the admission fee is considered a capital receipt in the past, the addition may be deleted. 3. Your appellant submits that in absence of any finding by the A.O. or the CIT(A) that admission fees has been utilised for day to day expenses or otherwise, ought not to have confirmed the addition, ignoring the fact that
the same was utilised for capital expenditure. This addition is bad in law. 4. Your appellant submits that the admission fees collected, is for the benefit of the students and teachers, is in the nature of capital receipts and as such has to be considered as capital receipt and the addition may be deleted. 5. Your appellant submits that provisions of section 28 to 43C are not applicable, therefore the disallowance of Rs. 1,73,690 U/s. 40(a)(ia) of the Act is bad in law. 6. Your appellant submits that the NBFCs have filed the return of income and paid taxes therefore disallowance U/s. 40(a)(ia) is not warranted. 7. Your appellant submits for these and such other grounds that may be urged at the time of hearing the additions may be deleted.”
At the outset, Ld. AR submitted that there is a delay of 30 days in filing the appeal before the Tribunal. In this regard, Ld. AR brought my attention towards the affidavit filed by the assessee seeking condonation of delay wherein the reasons for not filing the appeal within the prescribed time limit was explained. For reference, the relevant portions from the affidavit is extracted herein below:-
“…….The order of the CIT(A)-6, Hyderabad U/s. 250, dated 14/09/2018 for A.Y. 2015-16 was received by us on 30/11/2018 by Mr. N.V. Sudhakar. He was busy with assessments of other group companies and forgot to handover the copy to our Tax Consultants M/s. Anandam & Co., Chartered Accountants. The order was misplaced in the order. On receipt of the demand notice from the A.O. on 13/02/2019 (notice dated 11/02/2019), we traced the order on 18/02/2019 which got mixed up with scrutiny files. We have handed over the same to our tax consultants ……… ……………As a result, there is a delay in filing the appeal by about 30 days.”
After hearing the submissions of the Ld. AR and on perusal of the affidavit filed by the assessee explaining the reasons for the delay in filing the appeal before the Tribunal, I do not find much merit in the
submissions. The lethargic attitude of the assessee and its Counsel and their lame execute is not appreciable. The assessee should have been more vigilant to avoid such circumstances. However, taking a lenient view, in the interest of justice, I hereby condone the delay in the filing the appeal before the Tribunal and proceed to hear the appeal on merits.
At the outset, the Ld. AR submitted that the Ld. CIT (A) has passed ex-parte order without providing an opportunity to the assessee of being heard. It was therefore pleaded that the matter may be remitted back to the file of the Ld CIT (A) in order to provide one more opportunity to the assessee to pursue the appeal. Ld. DR, on the other hand, vehemently opposed to the submissions of the Ld. AR and argued that proper opportunities had been provided to the assessee however, on the given dates of hearing, neither the assessee nor his Representative appeared before the Ld. CIT (A). It was further submitted that the Ld. CIT (A) had no other option but to pass ex-parte order on merits based on the materials available on record. Hence, it was pleaded that the order passed by the Ld. CIT(A) needs no interference and appeal of the assessee may be dismissed.
I have heard the rival submissions and carefully perused the materials on record. On examining the facts of the case, I find merit in the submissions of the Ld. DR. The Ld. CIT(A) had posted the case for
hearing on two occasions i.e., 28/08/2018 and 14/09/2018. From the record it is apparent that neither the assessee nor his representative appeared before the Ld. CIT (A) on the given dates of hearing. Therefore, the Ld. CIT (A) was left with no other option except to adjudicate the appeal ex-parte based on the materials available on record. In this situation, once again I do not find much strength in the arguments advanced by the ld. AR. However, considering the prayer of the Ld. AR, in the interest of justice, I hereby remit the matter back to the file of Ld. CIT (A) in order to consider the appeal afresh by providing one more opportunity to the assessee of being heard. At the same breath, I also hereby caution the assessee to promptly co-operate before the Ld. CIT (A) in the proceedings failing which the Ld. CIT (A) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials on the record. It is ordered accordingly.
In the result, the appeal of the assessee is allowed for statistical purposes as indicated hereinabove.
Pronounced in the open Court on 19th November, 2019.
Sd/- (A. MOHAN ALANKAMONY) ACCOUNTANT MEMBER Hyderabad, Dated:19th November, 2019
OKK Copy to:- 1) DRS Educational Society C/o. M. Anandam & Co., Chartered Accountants, Flat No. 7A, Surya Towers, S.P. Road, Secunderabad. 2) Income Tax Officer, Ward-10(1), IT Towers, AC Guards, Hyderabad. 3) The CIT(A)-6, Hyderabad 4) The Pr. CIT-6, Hyderabad 5) The DR, ITAT, Hyderabad 6) Guard File