G.R.D.TRUST,COIMBATORE vs. ACIT (EXEMPTIONS), COIMBATORE

The Registry has noted a delay of 278 days in the appeal, the condonation of which has been sought by the assessee on the strength of condonation petition dated 25.03.2022 which is accompanied by the affidavit of assessee’s counsel Shri J. Balchander. In the affidavit, it has been submitted that the delay occurred due to the fact that original order got misplaced in the chamber and could not be traced immediately. After considerable efforts, the order was traced on 28.06.2019 and accordingly, the appeal was filed on 08.07.2019 with a delay of 278 days which was neither willful nor wanton. The Ld. Sr. DR vehemently opposed the condonation and submitted that the counsel could obtain true copies by making appropriate application. Considering the fact that the assessee is a charitable trust, we are inclined to condone the delay, however, with a cost of Rs.10,000/-. The cost shall be deposited by the assessee within 15 days from the date of receipt of this order to Tamil Nadu State Legal Services Authority at Hon’ble High Court of Madras. The receipt / proof shall be furnished to the registry forthwith. Accordingly, the delay is condoned and the appeal is admitted for adjudication on merits.

In intimation issued u/s 143(1), the amount of Rs.433.17 Lacs as accumulated / set apart by the assessee for specified purposes has not been considered as application of income. Upon further appeal, Ld. CIT(A) noted that the assessee trust had accumulated the said amount for specified purposes. The Ld. CIT(A) noted that no reason was given for such adjustment and this adjustment was beyond the scope of Sec.143(1) of the Act. The Ld. AO was directed to allow the claim of the 3 - assessee if Form 10B as provided in Rule 17B was filed by the assessee and it contain the detail of amount set apart as claimed by the assessee. Still aggrieved, the assessee is in further appeal before us.

Upon perusal of factual matrix, we find apparently the accumulation has been denied to the assessee for want of Form 10B. The Ld. CIT(A) had rightly noted that this adjustment could not be made u/s 143(1) provided the assessee had filed the requisite Form 10B as per Rules. The impugned order also takes note of the fact that the assessee had accumulated the said amount for specified purposes. Therefore, instead of remitting the issue to Ld. AO, Ld. CIT(A) could have verified filing of Form 10B. This is in in view of the fact that only a processing of the return has been done by CPC, Bengaluru and the assessee is not subjected to scrutiny assessment proceedings. The assessee would have no window to represent his case before CPC, Bengaluru. Therefore, we direct Ld. CIT(A) to verify the aspect of Form 10B and re- adjudicate the issue.

The appeal stands allowed for statistical purposes.