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Income Tax Appellate Tribunal, “G” BENCH, MUMBAI
Before: SHRI PRASHANT MAHARISHI & SHRI SANDEEP SINGH KARHAIL
The present appeal has been filed by the assessee challenging the impugned order dated 11th March 2021, passed under section 263 of the Income Tax Act, 1961 ("the Act") by the Learned Commissioner of Income Tax, Mumbai (“learned CIT”), for the assessment year 2016–17.
In this appeal, the assessee has raised following grounds:–
“The following grounds are independent of and without prejudice to one another:
Shree Anuruddha Upasana Foundation ITA No.686/Mum./2021
On the facts and circumstances of the case and in law, the Learned Commissioner of Income Tax (Exemptions), Mumbai has erred in setting aside the Order passed u/s 143(3) of the Act by the learned Assessing Officer, ITO(E), Ward 2(3) and thereby erred in passing an order under section 263 of the Act without appreciating that: (a) The notice dated 4th March 2021 issued u/s 263 of the Act itself is had in law especially since, neither there is any delay in intimation in Form No.10 to the learned AO (in view of extension 9th vide CBDT Circular F.No.225/195/2016-lTA-H dated September 2016) nor the amount set aside as "Development Fund" is disputed by the learned CIT(Exemption), Mumbai as is evident from both; i.e. the copy of the minutes submitted to Learned AO vide submission dated 25th August, 2018 and reiterated by the appellant by intimating the Learned CIT (Exemption) vide letter dated 10th March 2021 as well, whose contents also goes undisputed by him. (b) The learned CIT(Exemptions) has further not disputed the purpose of accumulation u/s 11(2) as is specifically elucidated in the Form of submission dated 10th March 2021 claiming that the same was filed before the learned Assessing Officer vide letter dated 25th August, 2018. (c) The learned CIT (Exemption) has further not disputed that the minutes of the meeting of the Board of Director held on 27th December 2016 was submitted: ln fact, the contents of the aforesaid claim of Accumulation of Rs.2,76,00,000/- made vide such letter dated 25th August 2018 and reiterated vide letter dated 10th March 2021 also goes undisputed. (d) The letter dated 22"' November, 2018 actually refers to "Ledger Extracts" of' amount deployed towards various projects in subsequent years and does not relate to averments made by the Learned CIT(Exemption), Mumbai and hence the inference drawn by him deserves to be 'Dismissed" in liminee.
2. The learned CIT (Exemption), Mumbai, failed to appreciate that as per section 11(2) of the Act, the responsibility of the Learned Assessing Officer is to merely ascertain as to whether the amount is set aside for various projects or not. There is no provision under the Act to verify the project-wise utilization of funds in the subsequent year as per section 11(2) of the Act and hence the Learned Commissioner of Income Tax (Exemptions). Mumbai has clearly erred in setting aside the Order passed by Shree Anuruddha Upasana Foundation ITA No.686/Mum./2021
the learned Assessing Officer. ITO(E), Ward–2(3), Mumbai, and thereby erred in passing an order under section 263 of' the Act.”
The only grievance of the assessee in the present appeal is against the order dated 11.03.2021 passed by the learned CIT under section 263 of the Act.
Brief facts of the case are: The assessee is a charitable orginsation with DIT(E), Mumbai, under section 12A of the Act, vide registration no.TR/39425 dated 8th September 2005, and with Charity Commissioner, Mumbai. The assessee, accordingly, claimed exemption under section 11 of the Act. The assessee filed its return of income on 8th October 2016, declaring total income at Rs. Nil. The Assessing Officer vide order dated 5th December 2018, passed under section 143(3) of the Act after examining the expenditure incurred by the assessee for the object of the trust accepted the total income of the assessee at Rs.Nil.
Vide notice dated 4th March 2021, the assessee was asked to show 5. cause as to why the assessment order dated 5th December 2018, be not set aside under section 263 of the Act. The said notice was duly responded by the assessee. The learned CIT, vide impugned order dated 11th March 2021, passed under section 263 of the Act held the assessment order to be erroneous insofar as it is prejudicial to the interests of Revenue and set aside the same with a direction to the Assessing Officer to examine the details produced by the assessee during the course of revision proceedings. Being aggrieved, the assessee is in appeal before us.
Shree Anuruddha Upasana Foundation ITA No.686/Mum./2021
During the course of hearing, both the parties made elaborate arguments on the grounds raised in the present appeal.
However, subsequently, the assessee, vide letter dated 27th April 7. 2022, submitted the copy of order dated 26th March 2022 passed by the Assessing Officer under section 143(3) r/w section 263 of the Act, wherein the assessee’s total income has been assessed at Rs. Nil and no disallowance has been made on the issue on which proceedings under section 263 of the Act were initiated.
In view of the above, as the Assessing Officer has now passed the order pursuant to directions issued by learned CIT vide impugned order, the present appeal filed by the assessee challenging the order passed by the learned CIT under section 263 of the Act is rendered academic in nature and therefore, is dismissed as infructuous.
In the result, appeal by the assessee is dismissed. Order pronounced in the open court on 05/05/2022