DEPUTY COMMISSIONER OF INCOME TAX, CHENNAI vs. JAYA EDUCATIONAL TRUST, THIRUVALLUR
आयकर अपीलीय अिधकरण, ‘सी’ ायपीठ, चेई
IN THE INCOME TAX APPELLATE TRIBUNAL
‘C’ BENCH, CHENNAI
ी मनु कुमार िगर, ाियक सद एवं ी एस. आर. रघुनाथा, लेखा सद के सम"
BEFORE SHRI MANU KUMAR GIRI, JUDICIAL MEMBER AND SHRI S.R.RAGHUNATHA, ACCOUNTANT MEMBER
आयकर अपील सं./ ITA. Nos.:234, 235, 236 & 237/Chny/2025 &
CO Nos.59, 60, 61 & 62/Chny/2025
(in ITA Nos. 234, 235, 236 & 237/Chny/2025)
िनधारण वष / Assessment Years: 2016-17, 2017-18, 2018-19 & 2020-21
Deputy Commissioner of Income Tax,
Central Circle -1(2),
Thiruvallur – 602 024. (अपीलाथ#/Appellant)
[PAN:AAATJ-0369-D]
($%थ#/Respondent)
Assessee by :
Shri. Y. Sridhar, F.C.A.
Department by :
Shri. Bipin C.N., C.I.T.
सुनवाई की तारीख/Date of Hearing
: 26.08.2025
घोषणा की तारीख/Date of Pronouncement
: 17.11.2025
आदेश /O R D E R
PER BENCH :
The captioned ITA Nos.234 to 237/Chny/2025 filed by the revenue are against the common order of Learned Commissioner of Income Tax (Appeal) -
18, Chennai, (in short “Ld.CIT(A)”) dated 20.11.2024 for the assessment years
2016-17 to 2018-19 and 2020-21 passed u/s.250 of the Income-Tax Act, 1961
(in short “The Act”). The C.O.Nos.59 to 62/Chny/2025 filed by the assessee are cross objections against the same orders of ld.CIT(A)-18, Chennai, in :-2-: ITA. Nos.:234, 235, 236 & 237/Chny/2025 &
CO Nos.59, 60,61 & 62/Chny/2025
respect of which the revenue has preferred appeals in the aforesaid ITA
Nos.234 to 237/Chny/2025. 2. In the first three appeals pertaining to A.Y.2016-17 to 2018-19 (ITA
Nos.234 to 236/Chny/2025), the grounds are common, except figures. Even for the appeal pertaining to AY 2020-21 in ITA No.237/Chny/2025, except for the last ground of appeal, therein, which relates to disallowance u/s.40A(3) of the Act, all the other grounds of appeal are common. The assessee has filed cross-objections in respect of all the four appeals filed by the revenue.
Therefore, we heard all the appeals and cross-objections together and disposing of the same by this common order.
Since the issue and facts are similar in all the assessment years, for the sake of convenience the grounds raised by the revenue in ITA No. 234/Chny/2025 are reproduced below.
The order of the ld. Commissioner of I.T. (Appeals) is opposed to law and facts of the case.
The ld. CIT(A) erred in allowing the corpus donation of Rs.14,51,14,000/- disallowed by the AO and which was not considered for exemption u/s.11 of the Act and further taxing the surplus income of Rs.32,52,27,918/- inter alia total income of the trust at maximum marginal rate (MMR) without confining to the extent of income determined which violated the provisions of section 13 of the Income-Tax Act, 1961. 3. The ld. CIT(A) erred in directing the AO to adopt the difference in intra institutional fee of Rs.4,76,82,339 instead of Rs.5,03,05,143/- based on the reconciliation submitted by the assessee, when the assessee has not produced any new evidence in support of the claim.
The ld. CIT(A) erred in admitting fresh evidence of the assessee in respect of utilization of funds towards agricultural land, in violation of Rule 46A of the I.T. Rules, 1962, without giving any opportunity to the AO to examine the :-3-: ITA. Nos.:234, 235, 236 & 237/Chny/2025 &
CO Nos.59, 60,61 & 62/Chny/2025
veracity of the same and calling for remand report as prescribed under Rule
46A of the Income-Tax Rules, 1962. 5. The ld. CIT(A) erred in observing that, if at all, there is violation of section 13(1)(c) of the Act, the exemption could be denied, and maximum marginal rate of taxation could be applied only to that part of income which is in violation of section 13(1)(c).
For these grounds and any other ground including amendment of grounds that may be raised during the course of the appeal proceedings, the order of ld. CIT(A) may be set aside on this ground and that of the Assessing Officer be restored.
In ITA No.237/Chny/2025 for the A.Y.2020-21, the revenue has raised one more ground of appeal, after Ground No.5 and before Ground No.6 (residuary ground of appeal) supra which is as follows : The ld. CIT(A) erred in restricting the disallowance u/s.40A(3) made by the AO for Rs.40,32,994/- to Rs.11,98,434/- considering the submission of the assessee that the actual expenses incurred would be many in numbers with less than Rs.10,000/- and cash was incurred for conducting various functions in Schools/Colleges run by the trust are grouped together under the head function expenses.
The cross-objections of the assessee are identical for all the assessment years 2016-17 to 2018-19 and 2020-21, which are reproduced below : 1. For that the order of the Commissioner of Income-Tax (Appeals) is contrary to law, facts and circumstances of the case to the extent prejudicial to the interest of the respondent and is opposed to the principles of natural justice, equity and fair play.
For that the Commissioner of Income Tax (Appeals) failed to appreciate that the search initiated in the case of the appellant is illegal and ultra vires the provisions of section 132(1)(a), (b) & (c) of the Act.
For that the Commissioner of Income Tax (Appeals) failed to appreciate the search is conducted not on the basis of any prior information or material inducing any belief but purely on the suspicion and therefore, the action under section 132(2) is bad in law [CIT v. Vindhya Metal Corporation, 224 ITR 614(SC)] and consequent assessment under section 153A is null and void abinitio on the parity of the ratio of the decision of the Hon’ble Apex Court in the case of Ajith Jain, reported in 260 ITR 80. :-4-: ITA. Nos.:234, 235, 236 & 237/Chny/2025 &
CO Nos.59, 60,61 & 62/Chny/2025
For that the Commissioner of Income Tax (Appeals) failed to appreciate that the order passed under section 143(3) r.w.s.153A of the Act is further bad in law as there is no valid search on the appellant under section 132 of the Act a valid search is a sine qua non for making a valid assessment under section 153A of the Act.
For that the Commissioner of Income Tax (Appeals) although principally accepted that the trust had utilized the monies for its objects, however not provided the entire relief for Rs.10.65 crores spent for the purchase of agriculture lands for establishing Agri. College and not considered the other contemporaneous evidences.
For that the Commissioner of Income Tax (Appeals) failed to appreciate that the avg. price per acre is Rs.24,00,000/-, which is based on the registered sale deed document in the sub