ACIT(E)- CIRCLE- 1(1), NEW DELHI vs. BALAJI MEDICAL & DIAGNOSTIC RESEARCH CENTRE, NEW DELHI
In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.
What did the Tribunal hold?
The assessee informed the tribunal that they had opted for the Vivad Se Vishwas Scheme for settlement of the dispute. The Revenue did not object, and the tribunal treated the appeal as withdrawn by the Revenue.
What were the facts?
The Revenue filed an appeal against the CIT(A)'s order allowing the assessee's claim for exemption. The assessee, Balaji Medical & Diagnostic Research Centre, had claimed exemption under sections 11 & 12 of the Income Tax Act.
What were the issues?
Whether the assessee's activities were commercial in nature, thus disentitling them to exemption, and if the running of the hospital for profit negated the charitable object.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
(A) This appeal by Revenue is filed against the order of Learned Commissioner of Income Tax (Appeals)-40, Delhi, [“Ld. CIT(A)”, for short], dated 19.06.2017 for Assessment Year 2011-12. Grounds taken in this appeal of Revenue are as under:
“1. Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that though the objects of the assessee seem to be charitable in nature but the activities which yielded income of the assessee are commercial in nature.
The society i.e. Balaji Medical and Diagnostic Research Centre which was allowed registration u/s 12A has ceased to have any effective function as far as hospital is concerned. The running of the hospital is governed by the profit motive for the benefit of Max Group, hence, claim for exemption u/s 11 & 12 of the assessee is no longer justifiable.
ITA No.-5776/Del/2017. Balaji Medical & Diagnostic Research Centre 3. Whether running of a hospital in commercial manner, without any perceptible element of charity and ploughing back the profit in expansion of the hospital qualifies the assessee to claim exemption u/s 11 & 12 as pursuing a charitable object. 4. The appellant craves leave to add, to alter or amend any ground of appeal raised above at the time of hearing.”
(B) At the time of hearing, at the outset, the Ld. Authorized Representative (“Ld. AR”, for short) for the Assessee informed us that the assessee has opted for Vivad Se Vishwas Scheme, 2020 (“VSVS”, for short) for the settlement of subject matter of the disputes in this appeal. She drew our attention to letter dated January 04, 2021 filed from assessee’s side in Income Tax Appellate Tribunal (“ITAT”, for short) giving intimation of the same. A Copy of declaration filed by assessee in respect of the aforesaid VSVS was also enclosed with aforesaid letter dated 04/01/2021. At the time of hearing before us, the Ld. AR for assessee submitted before us that this appeal may be dismissed on account of the aforesaid VSVS. The learned Commissioner of Income Tax (Departmental Representative)
[“Ld. CIT(DR)”, for short] did not express any objection to this. After due consideration, and in view of the foregoing; we treat this appeal as withdrawn by Revenue on account of the aforesaid VSVS. Accordingly, the appeal is dismissed being treated as withdrawn.
(B.1) Before we part, we hereby clarify, by way of abundant caution, that if for some reason it is found by Revenue that the disputes under this appeal before us are not fully settled under the aforesaid VSVS, then Revenue will be at liberty to approach ITAT for restoration of this appeal, in accordance with law.
ITA No.-5776/Del/2017. Balaji Medical & Diagnostic Research Centre (B.2) With these directions, the aforesaid appeal of Revenue is dismissed, being treated as withdrawn.
(C) For statistical purposes, this appeal is dismissed.
This order was already pronounced on 05th January, 2021 in Open Court, in the presence of Representatives of both sides; after conclusion of the hearing.
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