THE ASSISTANT COMMISSIONER OF INCOME TAX (EXEMPTIONS) CIRCLE-1, MANGALURU vs. M/S HYDERABAD KARNATAKA EDUCATION SOCIETY, KALBURGI

Learned AR of the assessee Mr. Rajkumar Hanchnal, Chartered Accountant, moved an application for adjournment of hearing of these appeals but the Bench noted that the tax effect in these appeals of the Revenue appears to be below Rs. 50 lakhs in each year and when this query was put to the to 2277/Bang/2018 Page 2 of 3 learned DR of the Revenue, learned DR of the Revenue could not point out that the tax effect in these appeals is above Rs.50 lakhs in any one or more of these 4 years. But it was submitted by learned DR of the Revenue that even if these appeals are dismissed by the Bench on the basis of the low tax effect, liberty should be granted to the Revenue to file MP as per the provisions of section 254 (2) of the Income Tax Act, 1961 (hereinafter called ‘the Act’), if it is found by the AO that the tax effect in any one or more years out of these 4 years is more than Rs.50 lakhs. Under these facts, the adjournment request moved by learned AR of the assessee was rejected and these appeals were taken as heard and are being disposed of in the light of the submissions made by learned DR of the Revenue as noted above.

We have considered the submissions of learned DR of the Revenue and have gone through the orders of authorities below. We find that in Assessment Year 2011-12, as per Form 36 filed by the Revenue, the returned income was Rs.5,58,72,000/- and the assessed income was Rs.5,74,19,470/- and as per the same, the total addition made by the AO is only of Rs.15,47,470/-. Similarly, in Assessment Year 2012-13, as per Form 36 filed by the Revenue, the returned income was Rs.14,38,49,999/- and the assessed income was Rs.14,78,34,169/- which means that in this year, the addition made by the AO was Rs.39,84,170/-. In Assessment Year 2013-14, as per Form 36 filed by the Revenue, the returned income was Rs.1405 lakhs and the assessed income was Rs.14,34,91,390/- which means that there was an addition of Rs.29,91,390/- only. Similarly, in Assessment Year 2014-15, as per Form 36 filed by the Revenue, the returned income was Rs.560 lakhs and the assessed income was Rs.575.51 lakhs which means that there was an addition of Rs.15.51 lakhs only. As per these figures of addition in these 4 years, it is seen that even if the entire addition is deleted by learned CIT(A) and the Revenue is in appeal against deletion of the entire amount of such addition then also, the tax effect in each year will be below Rs.50 lakhs. As per the grounds raised