SPORTS AUTHORITY OF INDIA,NEW DELHI vs. ADIT (E), NEW DELHI

On facts & Circumstances of the case and in law, for arguments and in alternative but without admittance, the lower authorities have erred and were not justified in withdrawing the exemption u/s 11, even if any part of the impugned amount of Rs 28,00,995/-, were in contravention of section Page 1 of 6 ITA-6318/Del/2012 Sports Authority of India. 13(1) and it was that very part of such impugned amount, which was only liable for withdrawal of exemption instead of the whole of income of the GOVERNMENT GRANT IS NOT INCOME: 3. On facts & circumstances of the case and in law, lower authorities have erred and were not justified in altering the returned total income as the whole or substantially the whole of income of the society is met by Government Grants (Plan & non-Plan) and were meant for only non-trading purposes and thus is outside the scope of section 2(24). GROUNDS AFFECTING QUANTUM OF INCOME: Capital Expenditure 4. On facts and circumstances of the case and in law, the lower authorities have erred and have arbitrarily making an addition of undisputed capital expenditure of Rs 6,51,27,842/-, actually incurred on the purpose & Objects of society, even if the exemption u/s 11 is denied on allegation of contravention of section 13 of the Act, during the validity of the registration u/s 12A of the Act.

On facts and circumstances of the case and in law, the lower authorities have erred and have arbitrarily making an addition of undisputed capital expenditure of Rs. 6,51,27,842/-, which has been met out of the Grants from the Government.

On facts and circumstances of the case and in law, for sake of arguments and in alternative, the lower authorities have erred in not allowing the depreciation on such impugned capital expenditure incurred during the year as well as capital expenditure in the past if such capital expenditure is not to be allowable. Accrual of Income: 7. On facts & circumstances of the case and in law, the lower authorities have erred and were not justified in making an addition of Rs 2,51,01,220/- as income accrued even under the mercantile system of accounting.

On facts & circumstances of the case and in law, for the sake of arguments and in alternative, the lower authorities have erred and were not justified in ignoring the fact that aforesaid unrealised accrued income of Rs 2,51,01,220/- results in appropriation by natural inference for the purpose and objects of the society and thus no addition was warranted. Taxes paid are application u/s 11 9. On facts & circumstances of the case and in law, the lower authorities have erred and were not justified in ignoring the well settled principle that ITA-6318/Del/2012 Sports Authority of India. tax paid is an application of income for the purpose of section 11, as was held by the jurisdictional high court in case of NASSCOM. Prior Period expenses: 10. On facts & circumstances of the case and in law, the lower authorities have erred and were not justified in making an addition of Rs. 6,13,44,739/- as prior period expense, which were admitted to be payable on sanction and thus became due during the relevant year itself, even under the mercantile system of accounting. Addition u/s 40(a)(iii) 11. On facts & circumstances of the case and in law, the lower authorities have erred and were not justified in making an addition of Rs. 1,97,45,476/- u/s 40(a)(iii) without any finding whether any default was actually occurred in accordance with section 192/ 195 of the Act. General 12. The lower authorities have acted arbitrarily in haste and has failed to fully appreciate the facts, circumstances and written submissions of the appellant on record and were not justified by not sharing their opinions or points of contentions so that the same could have been further & properly met by the appellant.

The above grounds of appeal