Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, ‘ A’ BENCH : CHENNAI
Before: SHRI ABRAHAM P GEORGE & SHRI GEORGE MATHAN
आदेश / O R D E R
PER GEORGE MATHAN , JUDICIAL MEMBER
These two appeals are filed by the assessee against the common order of the Commissioner of Income-tax (Appeals)-3, & 2415/Chny/2017 :- 2 -:
Chennai in appeal Nos.127 & 138/2016-17/A-3, dated 30.06.2017 for the assessment years 2012-13 and 2013-14.
Mr.D.Anand represented on behalf of the Assessee, and 2.
Mr.Amol B. Kirtane represented on behalf of the Revenue.
As both the appeals involved identical issue, the same is disposed off by this common order.
It was submitted by ld.A.R that the only issue in the assessees’ appeal was against the action of Ld.CIT(A) in confirming the disallowance of claim of deduction u/s.35(1)(ii) of the Act in respect of the donation given by the assessee to M/s.School of Human Genetics and Population Health, Kolkata (PAN:AABAS 4570 M). It was a submission that the ld. Assessing Officer had relied upon the statement recorded on 27.01.2015 from Smt.Samadirta Mukherjee Sardar, Secretary of the Trust. It was a further submission that admittedly an opportunity of cross-examination had been offered to the assessee, the same was given to the assessee at Kolkata and the time provided was very short. It was a submission that the assessee had no objection, if the issue in both the appeals was restored to the file of the AO for re-adjudication after granting the assessee adequate opportunity to substantiate its case. & 2415/Chny/2017 :- 3 -:
In reply, ld.D.R vehemently supported the orders of the ld. Assessing Officer and the ld.CIT(A). It was a submission that the issue was squarely covered by the decision of the Co-ordinate Bench of this Tribunal in the case of M/s.Megatrends Inc., Chennai Vs. The ACIT, Chennai in & 740/Chny/2017 vide order dated 05.03.2018 wherein the issue has been held as follows:-
“11. Coming to the issue of the donations in respect of which, the assessee has claimed weighted deduction u/s.35(1)(ii) of the Act, it is noticed that the AO has disbelieved the donations on the basis of statement recorded from one Mr.Swapan Ranjan Das Gupta, one of the major shareholders of HHBHRF and on account of a letter from CROSS and in respect of M/s.SHGPH on the basis of Survey Report. It is noticed that the onus of proving the genuineness of the donation rests on the assessee. However, the AO has taken up himself the onus to disprove the genuineness of the donation much before the assessee has proved the genuineness of the donation. When an assessee steps forward to give donations of Rs.1.25 Crs, Rs.25.00 lakhs, Rs.1.45 Crs. respectively, the assessee would have adequate reasons to give such donations. Here, it is noticed that the assessee has not been given any opportunity to prove the genuineness but the assessment has been made based on the evidences collected by the Revenue in the course of the survey conducted on the respective organizations. This is not permissible. This being so, in the interest of natural justice, the issue of the genuineness of the donations are restored to the file of the AO for re-adjudication. The AO must keep in mind that the onus of proving the donations are actually donations and not accommodation entries and that the said organizations were eligible for claiming deduction u/s.35(1)(ii) of the Act rests on the & 2415/Chny/2017 :- 4 -: assessee. If the AO does have any evidence to the contrary, it is to be put to the assessee for his rebuttal. The assessee shall produce the recipients of the donation for examination along with the evidences to prove the receipt of the donation. The internal communications of the Revenue are evidences for drawing an opinion on possible wrong claims but they are not the final evidence. This being so, the issue of the donation in these appeals are restored to the file of the AO for re- adjudication after granting the assessee adequate opportunity to prove the genuineness of the donation.”
Ld. DR submitted that the issue can be restored to the file of AO for re-adjudication in line with the decision of the Tribunal cited supra.
We have considered the rival submissions. A perusal of the assessment order in the assessee’s case for impugned assessment years clearly shows that opportunity of cross examination has been granted to the assessee at Kolkata, and also the time provided is admittedly very short. A perusal of the decision of Co-ordinate Bench of this Tribunal in the case of M/s.Megatrends Inc., referred to supra clearly shows that this issue has been restored to the file of ld. Assessing Officer for re-adjudication after granting the assessee adequate opportunity to prove the genuineness of the donation.
6.1 Considering these facts, we are of the view that the issue in these two appeals is liable to be restored to the file of ld. Assessing & 2415/Chny/2017 :- 5 -:
Officer for re-adjudication after granting the assessee adequate opportunity to substantiate its case. If the ld. Assessing Officer proposes to rely in any evidences, which is against the assessee, the same shall be put to assessee for cross-examination and rebuttal.
Under these circumstances, both the appeals of the assessee are partly allowed for statistical purposes.
In the result, both the appeals of the assessee for the assessment years 2012-13 and 2013-14 are partly allowed for statistical purposes.
Order pronounced in the open court after conclusion of hearing on 18th September, 2018, at Chennai.