M/S. MA SHARDA EDUCATIONAL SOCIETY,GHAZIABAD vs. ADDL. CIT, GHAZIABAD

per basic principle of law and not by virtue of section 11(1)(d) even

without any registration under section 12AA of the Act and cannot be

regarded income under section 2(24)(iia)/(56) of the Income Tax Act. He

stated that this issue is covered in favour of the assessee by the following

decisions of ITAT Benches:-

• DIT vs. Vishwa Hindu Parishad [2017] 82 taxmann.com 135 (Delhi). • ITO vs. Serum Institute of India Research Foundation (2018) 90 taxmann.com 229 (Pune) • CIT vs. Apparels Export Promotion Counsil (1991) 190 ITR 163 (Del.) • ITO vs. Smt. Basanti Devi & Sh. Chakhan Lal Garg Ed. Trust – ITA 5082/2010 (Del-G). • ITO vs. M/s Vokkaligara Sangha – ITA 281-285/2014 (Bang. ITAT) –order dt. 14.08.15

• ITO vs. Gaudiya Granth Anuved Trust – ITA 386/2012 (Agra)

• DCIT vs. KDA Enterprises (P) Ltd., (2012) 57 Taxmann.com 284 (Mumbai-Tribunal)

aforesaid decision rendered by the various Benches of the ITAT on the

issue in dispute which has been decided in favour of the assessee by

holding that when registration under section 12A of the Act is granted in

subsequent years, then exemption cannot be refused in earlier years

merely for registration under section 12A of the Act in terms of amended

section 12A of Income Tax Act. He also cited the case of Sree Sree

Ramkrishna Sanity vs. DCIT (2015) 64 taxmann.com 33 (Kol).

and maintenance, learned counsel for the assessee stated that the books

of accounts of the assessee are audited and bill vouchers were produced

by the assessee before the lower authorities which have been examined.

He further stated that Revenue authorities have not rejected the books of

accounts and no defect in any specific entry / payment were made nor

provision of section 142 or section 144 of the Act applied by the Revenue

authorities. All the payments are through banking channel and TDS

deducted against amount debited to building repair and maintenance, Rs.

14,66,370/- and only Rs. 42,64,094/- is paid in cash for day to day repair

and maintenance for petty amounts are duly booked to audited accounts.

offered disallowances of Rs. 1,11,06,370/- out of building repair

maintenance and Rs. 2,17,985/- out of other repair and maintenance

considering the facts of the case i.e. when landlord has claimed repair

allowance @ 30% subject to no imposition of penalty thus disallowance of

Rs. 13,24,355/- has made. But the learned First Appellate Authority has

also upheld this disallowances by ignoring the condition by the assessee

regarding the wrong surrender because the expenses booked under the

head building and repair and maintenance, but not repaired being

monthly payments for services and maintenance. He stated that

surrender is conditional but condition not followed by the AO but not only

Rs. 9 Lacs addition made over and above, but further initiated penalty,

hence the same does not bind assessee and even learned CIT(A) has

sustained the addition monthly on merits and not solely on surrender. He

stated that in view of the various decisions rendered by the ITAT which

includes the case of ITO vs. Ram Prakash [2014] 52 taxmann.com 361

(Agra-Trib.), the issue is covered in favour of the assessee.

learned counsel for the assessee and relied upon by the order passed by

the lower authorities.

Revenue authorities alongwith the paper books filed by the learned

counsel for the assessee in which he has attached various documentary

evidence supporting the claim of the assessee including various citations

referred by him during the course of arguments. I am of the considered

view that the issue of corpus donation of Rs. 9,02,500/- has already been

decided in favour of the assessee by the ITAT Delhi Benches decision

passed in the case of DIT vs. Vishwa Hindu Parishad [2017] 82

taxmann.com 135 (Delhi) / [2017] 248 taxman 290 (Delhi) / [2017] 394

ITR 411 (Delhi) / [2017] 297 CTR 148 (Delhi). The relevant paragraph 33

of the said order is reproduced as under:-

“33.The CIT(A) noted that even if there was a non-compliance with Section 12 A (b) of the Act by the Assessee, thus disentitling it to exemption under Sections 11 and 12 thereof, the AO was still not justified in adding the entire corpus of the Assessee to its taxable income. The corpus fund had been present in the earlier years and was a capital receipt. Even as per the original return, the Assessee did not have any excess over expenditure which could have been taxed. The ITAT committed no error in concurring with the CIT (A).

Delhi Bench cited above and in view of the order of the Kolkata Benches

of ITAT in the case of Sree Sree Ramkrishna Sanity vs. DCIT (2015) 64

taxmann.com 33 (Kol), I am of the view that addition of corpus donation

has already been decided in favour of the assessee by the ITAT Delhi

Bench (supra) by holding that even if there was a non compliance of

section 12A(b) of the Act by the assessee then the corpus donation

received by the assessee is not taxable in the hands of assessee.

Secondly when the registration under section 12AA is granted in the

subsequent year then exemption cannot be refused in the earlier years

merely for non registration under section 12A in terms of amended under

section 12A of the Act. Keeping in view of the aforesaid discussion and

respectfully following the precedents as aforesaid, the addition of Rs.

9,02,500/- on account of corpus donation is deleted.

account of repair and maintenance. After considering the arguments

advanced by the learned counsel for the assessee and the learned DR

alongwith the documentary evidences filed by the assessee in support of

his contention, I am of the considered view that books of accounts of the

assessee are audited and bill and vouchers in support of the expenses has

been produced by the assessee and examined by the Assessing Officer.

The Assessing Officer has not pointed out any defect and has also not

rejected the same by applying the provisions of section 145 of the I.T.

Act. Even otherwise, all the payments were through bank channel and

TDS deducted, against building repair and maintenance amount.

Therefore, keeping in view the facts and circumstances of the present

case and the non rejection of books of accounts the addition in dispute is

not sustainable in the eyes of law, therefore, the same is deleted by

allowing the ground no. 2.

involved in the grounds of appeal are deleted by accepting the appeal

filed by the assessee.

Order pronounced on 20/12/2019.

Sd/- [H.S. SIDHU] JUDICIAL MEMBER Date: 20/12/2019 SH