DY. COMMISSIONER OF INCOME TAX (EXEMPTIONS), CIRCLE, PUNE, SWARGATE, PUNE vs. DATTAJIRAO KADAM TECHNICAL EDUCATION SOCIETY ICHALKARANJI, KOLHAPU

It was seen from the order sheet entries that due to non-appearance from the side of the assessee on 2 occasions, a notice was served on the assessee through the Department. However, despite such notice being served on the assessee (acknowledgement is placed on record), none appeared on behalf of the assessee nor any application seeking adjournment of the case was filed. Under these circumstances, we deem it proper to decide the appeal on the basis of material available on record and after hearing the Ld. DR.

Facts of the case, in brief, are that the assessee is a trust and has been granted registration u/s 12A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’). It filed its return of income on 29.09.2022 declaring Nil income. The case of the assessee was selected for scrutiny. Accordingly statutory notices u/s 143(2) and 142(1) of the Act were issued and served on the assessee. The assessee in response to the same filed its submissions. During the course of assessment proceedings the Assessing Officer noted that the assessee is a trust and has been granted registration u/s 12A of the Act. It has obtained provisional registration on 28.05.2021 from assessment year 2022-23 to assessment year 2026- 27. The receipts of the trust are mainly from fees, govt. grants, donation, rental income etc. The assessee is running 16 schools and colleges. From the financials submitted by the assessee the Assessing Officer noted that during the year the assessee has received gross receipts of Rs.60,59,81,891/- and claimed revenue expenditure of Rs.51,04,00,807/- and capital expenditure of Rs.2,02,79,774/-. He further noted that the assessee has also claimed repayment of loan of Rs.4,72,20,482/- as application. Since the assessee did not furnish the financials along with receipts and payments account, the computation of income for the year in which the loan was taken, the confirmation of loan taken from the bank and supporting bank statement and sanction details and did not furnish the breakup of capital expenditure incurred out of loan and since it is not clear as to whether the funds utilized towards capital expenditure is met out of borrowed loan or from the receipts of the assessee, the Assessing Officer did not allow the claim of repayment of loan u/s 11 and disallowed the same. He accordingly disallowed an amount of Rs.4,72,20,482/-.