MATA LALTI DEVI FOUNDATION,ARA vs. ITO, WARD- 1 (4), ARA
Facts
Mata Lalti Devi Foundation, an educational institution, filed an appeal against the CIT(A)'s order for AY 2021-22, which assessed its gross receipts as taxable income after disallowing application of funds. The assessee claimed exemption under Section 10(23C)(iiiad)/10(23C)(iiid), but the CIT(A) dismissed the claim, citing that it was not made in the original return, relying on the Goetze (India) Ltd. decision. An initial delay of 244 days in filing the appeal was condoned by the Tribunal.
Held
The Tribunal ruled that the CIT(A) misinterpreted the Goetze (India) Ltd. decision, asserting that additional claims can be made in appellate proceedings. It held that the assessee's trust, being an educational institution with gross receipts below ₹1 crore, is exempt under Section 10(23C)(iiid) and does not require registration. Consequently, the Tribunal set aside the CIT(A)'s order and directed the AO to delete the addition.
Key Issues
1. Whether an additional claim for exemption under Section 10(23C) can be raised for the first time in appellate proceedings. 2. Whether an educational institution with gross receipts below ₹1 crore requires registration to claim exemption under Section 10(23C)(iiid).
Sections Cited
143(1), 10(23C)(iiiad), 10(23)(vi), 10(23C)(iiid)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “PATNA” BENCH, PATNA
Before: SHRI DUVVURU RL REDDY, VP & SHRI RAJESH KUMAR, AM
Per Rajesh Kumar, AM:
This is an appeal preferred by the assessee against the order of the CIT (A), ADDL/JCIT(A)-1, Lucknow (hereinafter referred to as the “Ld. CIT(A)”] dated 08.10.2024 for the AY 2021-22.
At the outset, we note that the appeal of the assessee is barred by limitation by 244 days. At the time of hearing the counsel of the assessee explained the reasons for delay in filing the appeal. The Ld. D.R did not raise any objection in condoning the delay. After hearing the rival contentions and perusing the materials available on record, we find that the delay is for bonafide and genuine reasons, hence, we condone the delay and admit the appeal for adjudication.
3.1. In the appellate proceedings, the learned CIT (A) dismissed the plea of the assessee on the ground that original return of income, the assessee has not made any claim under qua this exemption and this is an alternative submission made by the assessee during the course of appellate proceedings which cannot be entertained by relying on the decision of Goetze (India) Ltd. v. Commissioner of Income Tax (CIT) 284 ITR 323 (SC).
After hearing the rival contentions and perusing the materials available on record, we find that the assessee has not made any claim u/s 10(23C)(iiid)of the Act in the return of income filed for the instant assessment year. In our considered view even though the assessee has not claimed as such, but in the appellate proceedings there is no
3.2. The second plea raised by the assessee that it is only the net income which is to be assessed to tax and not the gross receipt as has been done by the learned AO. Even this argument of the assessee trust is fully meritorious. We even opine that net income of the assessee as computed after allowing deduction of expenses incurred is to be assessed as income. But since, we have allowed the main plea of the assessee, therefore, we are not adjudicating this alternative submission of the assessee.
In the result, the appeal of the assessee is allowed.
Order pronounced in the open court on 28.11.2025.
Sd/- Sd/- (DUVVURU RL REDDY) (RAJESH KUMAR) (VICE PRESIDENT) (ACCOUNTANT MEMBER) Patna, Dated: 28.11.2025
Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Patna
