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Income Tax Appellate Tribunal, ‘SMC ‘ BENCH
Before: SHRI M.BALAGANESH & MS. KAVITHA RAJAGOPAL
आदेश / O R D E R PER M. BALAGANESH (A.M):
This appeal in A.Y. 2014-15 arises out of the order by the ld. Commissioner of Income Tax (Appeals)- 38 Mumbai, in appeal No.CIT(A)38/ITO-26(1)(4)/IT-524/2016-17 dated 28/02/2019 (ld. CIT(A) in short) against the order of assessment passed u/s.143(3) of the Income Tax Act, 1961 of the Income Tax Act, 1961 (hereinafter referred to as Act) dated 31/10/2016 by the ld. Income Tax officer – 25(3)(4) Mumbai. (hereinafter referred to as ld. AO).
Sir Vithaldas Tackersey College of Home science(Autonomous)SNDT Women’s University
At the outset, there is a delay of 2 days in filing of appeal by the assessee. The assessee has filed petition for condonation of delay for the same and we are convinced with the reasons for the delay. Accordingly, the delay is condoned and the appeal of the assessee is admitted for adjudication.
2.1. The assessee has raised the following grounds of appeal:- 1) The learned Assessing Officer failed to appreciate that:- a) The appellant is an educational institution and an autonomous college (deemed university) conducting its institution at Juhu Campus of S.N.D.T. Women's University which is registered under the provisions of Section 10(23C) (iiiad) of the Income Tax Act 1961. b) The appellant is fully controlled and governed by the SNDT Women's University, being the parent body. The SNDT Women's University has three campuses i.e. Churchgate, Juhu and Pune and various affiliated colleges. c) The Appellant had made a genuine error of obtaining separate PAN and filing its Return of Income on the separate PAN inadvertently. The filing of Return of Income under separate PAN does not change the color of Income or transaction and thereby deny the claim of Exemption u/s.10(23c) (iiiad) of Income Tax Act,1961 which is otherwise available and claimed by SNDT Women's University. 2) The learned CIT (A) erred in confirming Assessing Officer stand of treating Appellant institution as Body of Individuals (BOI) for erroneously obtaining PAN as BOI and filing of returns. 3) The learned CIT(A) erred in upholding the assessment of the Income of the Appellant on the basis that it was not entitled to exemption u/s 11 and 12 of the Income Tax Act, 1961 on ground that the Appellant is a separate and independent entity which is not registered u/s 10(23c) (iiiad) of Income Tax Act,1961. 4) The Appellant College i.e. SVT College of Home Science is a part and parcel of S.N.D.T. Women's University. The Appellant does not have a separate existence as per the law. The Appellant had inadvertently made
Sir Vithaldas Tackersey College of Home science(Autonomous)SNDT Women’s University a mistake of obtaining a PAN and filing a return of income. In fact and in law the Appellant does not have an existence to be regarded as a person. The person to be recognized and authorized to file this Appeal in the instant case is the S.N.D.T. Women's University. Hence the Appeal is signed by the authorized person / principal officer of the S.N.D.T. Women's University. Though the Appeal is in the name of SVT College of Home Science the matter pertains to the claim of exemption eligible to the S.N.D.T. Women's University which should be made available to the Appellant i.e. SVT College of Home Science and hence signed by the authorized person/principal officer of the S.N.D.T. Women's University. 5) The appellant craves leave to add, alter, amend or modify any of the grounds of appeal at any time before the time of hearing and make the necessary submissions.
We have heard rival submissions and perused the materials available on record. We find that assessee herein is a constituent of SNDT Women’s University. The assessee in its independent status however, obtained PAN and filed return of income in respect of surplus earned by it and paid taxes thereon. Before the ld.AO, the assessee submitted that it has no independent existence for the purpose of income tax as it is only a constituent of SNDT Women’s University. The autonomy enjoyed by it is only academic and cannot be construed as a legal entity having independent existence on its own. The assessee also made a request before the ld.AO that either way, its income exempt u/s 10(23C)(iiiad) of the Act. This plea was rejected by the ld.AO that the said exemption was not claimed by the assessee in the return of income; that the said exemption could not be granted to the assessee as it is not approved by the prescribed authority and that the assessee could not claim an exemption on the basis of exemption availed of by the parent i.e. SNDT Women’s University in view of the fact that SNDT University and assessee were independent units. Accordingly, entire returned income was sought to be taxed by the ld.AO by treating the assessee as Body of Individuals
Sir Vithaldas Tackersey College of Home science(Autonomous)SNDT Women’s University (BOI). All the aforesaid contentions of the ld. AO were upheld by the ld.CIT(A).
3.1. It is not in dispute that assessee is not independently registered u/s.12A of the act. We find that assessee in its paper book had filed an affidavit from Dr.Jagmeet Madan, Principal of assessee’s college in pages 10 to 11 of the paper book. Further an affidavit of Dr.Shubhas Waghmare, Registrar of SNDT Women’s University is also filed in pages 12 & 13 of the paper book. In both these affidavits, it is categorically stated that the assessee college is part of the SNDT Women’s University; that the PAN obtained by the assessee in its independent capacity is erroneous ; that the financial affairs of the assessee college are merged with the parent organization i.e. SNDT Women’s University from FY 2014- 15 relevant to AY 2015-16; that the assessee college had not filed any income tax returns in its own PAN after the A.Y.2014-15 and PAN card of the assessee had been surrendered. We further find from the letter issued by the University Grants Commission, Government of India dated April 1995 that assessee college has been conferred autonomous status and the said letter is addressed to the Registrar of SNDT Women’s University. This categorically goes to prove that assessee college is only the constituent of SNDT Women’s University and does not have any independent status as such. Hence, we hold that assessee college obtaining PAN in its independent status and filing income tax returns is erroneous in the eyes of law. Though this has been rectified by the assessee from A.Y. 2015-16 onwards by merging financial affairs of the college with the financials of SNDT Women’s University as is evident from the affidavits filed by the Principal and Registrar as stated supra, the income offered by the assessee per se does not deserve to be taxed at all as assessee is not an independent entity at all.
Sir Vithaldas Tackersey College of Home science(Autonomous)SNDT Women’s University 3.2. The ld.AR before us vehemently pleaded that up to AY 2014-15, it is a fact that assessee had erroneously treated itself as an independent entity and filed its returns. However, the assessee would still be entitled for exemption u/s 10(23C) (iiiab) and not u/s 10(23C)(iiiad) of the Act as the assessee is an educational institution wholly and substantially financed by Government. This is a fresh claim made by the assessee before us. Considering the totality of facts and circumstances of the case, in the interest of justice and fair play, we deem it fit and appropriate to remand this entire appeal to the file of the ld.AO for denovo adjudication in accordance with law. All the arguments of the assessee could be made before ld.AO in the set aside proceedings. The assessee is at liberty to furnish fresh evidences, if any, in support of all its exempts. Needless to mention that the assessee be given reasonable opportunity of being heard. The ld.AO is hereby directed to frame fresh assessment for the year under consideration in accordance with law by considering the aforesaid observations and the evidences filed by the assessee on record. Accordingly, the grounds raised by the assessee are allowed for statistical purposes.
In the result, appeal of the assessee is allowed for statistical purposes. Order pronounced on 30/09/2022 by way of proper mentioning in the notice board.