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Facts
The assessee, a charitable society, filed its ITR for AY 2013-14 claiming Section 11 exemption, but due to a technical error, charitable expenditure of Rs. 32,69,696/- was not reflected in Part B-T1 of the ITR. An intimation under Section 143(1) was issued and later rectified under Section 154, leading to the taxing of gross receipts. The CIT(A) dismissed the assessee's appeal, holding that no exemption under Section 11 was claimed.
Held
The ITAT found that it was a clear case of non-capturing figures due to a technical glitch and that the assessee had indeed incurred charitable expenditure. The appeal is restored to the Assessing Officer for a de novo adjudication to verify the claim of expenses for charitable purposes and then decide on the eligibility for exemption under Section 11 of the Act.
Key Issues
Whether the CIT(A) was justified in denying exemption under Section 11 by upholding an intimation under Section 143(1), when the non-reflection of charitable expenditure in the ITR was due to a technical error.
Sections Cited
11, 12AA, 12AB, 143(1), 154, 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, AGRA BENCH,(SMC
Before: SHRI M. BALAGANESH, HON’BLE & SHRI SUNIL KUMAR SINGH, HON’BLE
ORDER
PER M. BALAGANESH, ACCOUNTANT MEMBER
This appeal has been filed by the assessee against the order dated 14.11.2025 passed by the Learned Commissioner of Income Tax (Appeals), Bhubaneshwar [hereinafter referred to as “the CIT(A)"] u/s. 250 of the Income tax Act, 1961 (hereinafter referred to as "the Act"] for the assessment year 2013-14.
The only issue involved in this appeal is as to whether the Ld. CITA was justified in upholding the intimation u/s 143(1) of the Act by taxing the gross receipts to tax by denying the exemption u/s 11 of the Act in the facts and circumstances of the instant case.
Kalptru Vikash Samiti 3. We have heard the rival submissions and perused the materials available on record. The assessee is a charitable society duly registered under section 12AA of the Act vide order dated 19-12-2002 passed by Learned CIT Gwalior. Later the assessee was also registered with the Learned CIT (Exemptions) under section 12AB of the Act as a charitable trust vide order dated 21-06-2023. The assessee was established in 1996 as a voluntary organization and got registered under Madhya Pradesh Firms and Societies Registration Act 1973. The organization started its work in Gwalior City and Guna District. At present the organization is working in Guna District of Madhya Pradesh on various issues like child rights, child education, malnutrition, water sanitation and hygiene, organic farming, right to information, health, maternal health, HIV/AIDS, income generation for livelihood and many other issues related to community development with the support of international donors and Government. The assessee is working for the last 26-27 years in various fields engaged with different organizations national and international both focusing on different aspects of community and Indian society. Broadly the area of intervention to various aspects of human life like health and nutrition, education, sanitation and hygiene, skill development were predominantly carried out by the assessee. The assessee had maintained its books of accounts in the regular way and had got it audited.
Kalptru Vikash Samiti 4. The return of income was also filed along with the audit report in Form No. 10 B. The return of income for the assessment year 2013-14 was filed on 7-11-2013 in ITR form 7 after claiming exemption under section 11 of the Act by declaring Nil income. Due to technical mistakes in the ITR form, the proper head of application of income was not filled by the assessee. Factually, the assessee had indeed incurred revenue expenditure of Rs. 32,69,696/- towards its charitable objects. But unfortunately this figure of application was not reflected in the ITR form under Part B- T1 wherein only the gross receipts figure was mentioned. Despite non-mentioning of application of funds for charitable purposes in the concerned column of the Part B- T1 in ITR, still the total income was reflected in the said ITR only at Rs. Nil. This itself goes to prove that the figures of application of income has indeed been mentioned by the assessee elsewhere in the ITR but the same had not been captured in the ITR in Part B-T1. This is purely a technical glitch and a mere typographical error that had crept in in the ITR.
We find that on after the filing of income tax return in ITR 7 by the assessee on 7-11-2013 along with the audit report in Form No. 10B, purportedly an intimation under section 143(1) of the Act was passed by CPC Bangalore processing the return accepting the returned income there on. The learned AR submitted before us that this intimation under section 143(1) of the Act was not served on the assessee. Later the Kalptru Vikash Samiti said intimation under section 143(1) of the Act was suo moto rectified under section 154 of the Act by the learned ITO Gwalior vide order dated 8-8-2022 without even issuing notice under section 154 of the Act to the assessee. Even the order passed under section 154 of the Act dated 8-8-2022 was stated to be not served on the assessee. It was submitted that the assessee came to know of the order passed under section 154 of the Act only in the month of November 2023 when the income tax department called the assessee with regard to payment of outstanding taxes. Thereafter the assessee collected the order from the department and had filed an appeal before the Learned CITA with a delay of 454 days. The learned CITA graciously condoned the delay in filing of appeal accepting the reasons of the assessee. However, the Learned CITA had dismissed the appeal on a technical ground that assessee itself had not claimed any exemption under section 11 of the Act in the ITR by placing reliance on Part B-T1 of the ITR as detailed supra.
We find that this is a clear case of non-capturing of the figures of application of income from one page of the ITR to the relevant page of the ITR in Part B-T1. The copy of computation of income is duly placed on record from where it is very clear that assessee had indeed spent a sum of Rs. 32,69,696/- towards its charitable objects during the year on account of revenue expenditure. However, this fact has not been verified by the learned AO. Hence we deem it fit and appropriate in the Kalptru Vikash Samiti interest of justice and fair play, to restore this appeal to the file of Learned AO for de novo adjudication in accordance with law qua the issue in dispute before us. The learned AO shall examine whether the claim of expenses meant to be applied for charitable purposes is in order or not before deciding to grant exemption under section 11 of the Act to the assessee. If it is found that the amounts are applied only for charitable purposes, then assessee shall be eligible for exemption under section 11 of the Act. With these observations, the grounds raised by the assessee are allowed for statistical purposes.
In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open court on 20.03.2026 .