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Income Tax Appellate Tribunal, DELHI BENCH “F”, NEW DELHI
Before: SH. N. K. BILLAIYA & SMT. BEENA A. PILLAI
PER BEENA A. PILLAI, J.M : Present appeal has been filed by assessee against order dated 23/04/15 passed by Ld.CIT(A)-40 (Exemption), New Delhi for assessment year 2011-12 on the following grounds of appeal:
1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that the assessee who has rental income should be allowed benefit of exemption u/s 10(23C)(iiiad).
Brief facts of the case are as under : Assessee filed its return of income on 29/09/11 declaring total income at ‘nil’, after claiming application of income, as per provisions of section 11 and 12 of the Act. Assessee submitted before the Ld.AO that it is a registered society under Societies Registration Act 1860, and is running charitable girls school in Delhi from part of Wakf properties in Delhi. It was submitted that during the year under consideration, assessee earned income from donation, fees, rent receipts, bank interest and other miscellaneous income. It also claimed before Ld.AO that it is registered under section 12 A of the Act, however no proof of such registration was furnished during assessment proceedings. Ld.AO during assessment proceedings observed that assessee had not furnished proof of registration granted under section 12 A of the Act even for assessment year 1996-97, and therefore assessing officer while passing order under section 143 (3) of the Act rejected benefits under section 11 and 12 of the Act.
Ld.AO for the year under consideration denied the benefit under section 11 and 12 of the Act for the similar reason that assessee failed to furnish the proof of registration under section 12 A. Ld.AO thus treated assessee as AOP, and entire surplus after allowing corresponding expenses to gross receipts as per income and expenditure account was taxed. 4. Assessing officer further observed that assessee had received Rs. 50 Lacs, which was not offered to tax. Accordingly Ld.AO made addition to the returned income amounting to Rs.50 Lacs. Aggrieved by the order of Ld.AO, assessee preferred appeal before Ld.CIT (A). Before Ld.CIT (A) assessee raised claim of exemption under section 10(23C) (iiiad), as assessee is only existing for the purpose of education and is eligible for exemption under this provision. It was submitted that assessee enjoyed benefit till assessment year 1996- 97 under section 10(22) which is pari materia with section 10(23C)(iiiad). Ld.CIT (A) upon considering submissions of assessee, allowed claim of exemption under section 10(23C)(iiiad). He also deleted addition made by Ld.AO of Rs. 50 Lacs, relying upon the decision of this Tribunal in the case of Param Hamsa Swami Uma Bharti Mission vs ACIT reported in 29 Taxmann.com 223.
Aggrieved by the order of Ld. CIT (A) revenue is in appeal before us now.
Main contention alleged by Ld.Sr.DR is that, assessee has not made any claim in its return of income, or has filed revised return of income raising claim under section 10(23C)(iiiad) of the Act. He submitted that there was no submissions made by assessee regarding claim under 10(23C)(iiiad), at the time of assessment proceedings. He submitted that it was for 1st time that assessee raised its entitlement of exemption under section 10(23C)(iiiad) before Ld.CIT (A).
Ld.Sr.DR submitted that decision relied upon by Ld.CIT (A) for deleting addition of Rs. 50 Lacs is misconceived, as in the facts of that case assessee had made claim under section 10(23C)(iiiad) of the Act in the return of income. He submitted that in the facts of the present case assessee has always raised exemption under section 11 of the Act, which was denied due to non-production of registration under section 12 AA of the Act.
On the contrary Ld.AR submitted that for assessment year 2012- 13, assessing officer himself granted exemption under section 10 (23C)(iiiad) of the Act, as receipts were below 1 crore, and assessee is running for charitable purposes and not for purposes of profit. He submitted that assessing officer for assessment year 2012-13 is satisfied with the conditions laid down in section 10 (23C)(iiiad).
We have perused the submissions advanced by both the sides and the light of records placed before us. On perusal of order passed by Ld.CIT(A), it is observed that there has been no verification regarding satisfaction of conditions as per section 10 (23C)(iiiad) of the Act. It is also observed that assessment order placed in the paper book at page 6-7 for assessment year 1996-97, a claim was raised under section 10(22) of the Act, which was verified by Ld.AO. Even for assessment year 2012-13 assessee filed its return of income in the status of ‘society’, and raised claim under section 10 (23C)(iiiad) of the Act.
We therefore, are inclined to set aside this issue to Ld.AO in the interest of Justice to verify contentions of assessee under section 10 (23C)(iiiad) of the Act, and to grant exemption as per law. In respect of the addition made amounting to Rs. 50 Lacs, Ld.AO is directed to verify the receipts and to allow the claim as per law.
Needless to say that Ld.AO shall grant proper opportunity to assessee to represent its case and assessee is also directed to furnish all requisite details as called for by Ld.AO to adjudicate the issue. With the above directions grounds raised
by revenue stands allowed for statistical purposes.
12. In the result appeal filed by revenue stands allowed for statistical purposes. Order pronounced in the open court on 8th August, 2018.