ASST.COMMISSIONER OF INCOME TAX(EXEMPTIONS), CIRCLE-1, BENGALURU, BENGALURU vs. K J FOUNDATION, BENGALURU

ITA 1327/BANG/2024Status: DisposedITAT Bangalore09 June 2025AY 2020-21Bench: SHRI PRASHANT MAHARISHI (Vice President), SHRI KESHAV DUBEY (Judicial Member)9 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the issue was squarely covered by a previous decision of a Coordinate Bench in the assessee's own case for AY 2017-18. Following that precedent, the Tribunal found no violation of Section 13 and upheld the assessee's entitlement to exemption.

What were the facts?

The assessee trust paid lease rent to Eduspark International Pvt. Ltd. (EIPL), a company where the assessee's trustee was a director and majority shareholder. The Assessing Officer (AO) alleged that the rent paid was excessive and constituted a diversion of trust funds for the benefit of a 'specified person' under Section 13(3).

What were the issues?

Whether the lease rent paid by the trust to a related company constituted a diversion of income for the benefit of a specified person, leading to denial of exemption under Section 11.

Which sections of the Income-tax Act were involved?

Section 13(3),Section 13(2)(c),Section 13(2)(g),Section 11

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Income Tax Appellate Tribunal, “A” BENCH : BANGALORE

Before: SHRI PRASHANT MAHARISHI & SHRI KESHAV DUBEY

For Appellant: Smt. Praveena S., CIT (DR)(ITAT), Bengaluru
For Respondent: Shri Satish Mody, Advocate & Kunjan Gandhi, CA
Hearing: 04.06.2025Pronounced: 09.06.2025

Per Prashant Maharishi, Vice President

1.

These two appeals are filed by ACIT (Exemptions), Circle 1, Bengaluru against the appellate order passed by the National Faceless Appeal Centre, Delhi (NFAC) [ld. CIT(A)] for AYs 2020-21 & 2021- 22 dated 15.5.2024 & 16.5.2024 respectively wherein the appeals filed

ITA Nos.1327 & 1328/Bang/2024 by the assessee against the assessment orders were allowed. Therefore, revenue is aggrieved and preferred both these appeals.

2.

As the facts of the case are identical in both the years, the grounds o

The order continues below.

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