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Facts
The Assessing Officer disallowed a deduction claimed by M/s. Wardha Education Society and made additions totaling Rs. 38,01,329/- for variation in surplus and unexplained investment. Both lower authorities denied exemption under Section 10(23C) due to the Assessee's failure to provide relevant details. The Assessee argued before the Tribunal that its income is exempt as it is a Government-funded organization.
Held
Given the lack of relevant documents and the need for proper adjudication, the Tribunal deemed it appropriate to remand the case back to the Ld. Commissioner for a fresh decision. The Assessee is directed to comply with notices and submit all necessary documents, ensuring a reasonable opportunity of being heard.
Key Issues
The key issue was the Assessee's eligibility for exemption under Section 10(23C) of the Income Tax Act, 1961, which was denied by lower authorities due to non-furnishing of details, leading to disallowance of deduction and additions.
Sections Cited
10(23C), 10(23C)(iiiab), 10(23C)(iiiad), 250
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, NAGPUR BENCH “SMC”, NAGPUR
Before: SHRI NARENDER KUMAR CHOUDHRY
Per : Narender Kumar Choudhry, Judicial Member:
This appeal has been preferred by the Assessee against the order dated 05.11.2024, impugned herein, passed by the National Faceless Appeal Center (NFAC)/Ld. Commissioner of Income Tax (Appeals) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2015-16.
In this case, the Assessing Officer (AO) disallowed the deduction claimed by the Assessee and made the addition of Rs.5,79,640/- in respect of variation in surplus and Rs.32,21,689/- variation in respect of unexplained investment and computed the income to the tune of Rs.38,01,329/-. Before both the authorities below the Assessee has not filed relevant details to determine the eligibility of exemption u/s 10(23C)(iiiab)/10(23C)(iiiad) of the Act and the income and expenditure. Therefore, both the authorities below declined to grant the deduction claimed by the Assessee society. Whereas before this Court the Assessee has pleaded that it is totally Government funded organization based on the grant received from Government etc. and all the income received by the society is therefore exempt u/s 10(23C) of the Act and therefore one last and final opportunity may be given to the Assessee to demonstrate its case properly, before the Ld. Commissioner.
Considering the peculiar facts and circumstances in totality and the specific fact that in the absence of relevant details and documents the issue also remained to be adjudicated in its right perspective and proper manner. Therefore, for just and proper decision of the case and substantial justice this Court deem it appropriate to remand the instant case to the file of the Ld. Commissioner for decision afresh, suffice to say by affording reasonable opportunity of being heard to the Assessee.
Thus, the case is accordingly remanded to the file of the Ld. Commissioner for decision afresh.
The Assessee is also directed to comply with the notices to be issued by the Ld. Commissioner and file the relevant submissions/documents as would be essentially required for proper and just decision of the case. It is clarified that in case of subsequent default, the Assessee shall not be entitled for any leniency.
In the result, the Assessee’s appeal is allowed for statistical purposes.
Order is pronounced on 24.09.2025 as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rules, 1963.