ITO (E), NEW DELHI vs. EAST POINT EDUCATION SOCIETY, NEW DELHI

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ITA 6594/DEL/2015Status: DisposedITAT Delhi20 September 2017AY 2011-123 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal followed its own previous order in the assessee's own case for an earlier assessment year, which had decided the identical issue in favour of the assessee. The Tribunal found no merit in the department's appeal.

What were the facts?

The department appealed the CIT(A)'s order allowing the assessee's appeal. The core issue was whether payments were made to a person specified under Section 13(3) of the Income Tax Act.

What were the issues?

Whether payments made by the assessee society were to a person specified under Section 13(3) of the Income Tax Act, leading to denial of registration under Section 11.

Which sections of the Income-tax Act were involved?

Section 13(3),Section 13(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘F’, NEW DELHI

For Respondent: Smt. Paramita Tripathy, CIT DR
Hearing: 19.09.2017Pronounced: 20.09.2017

ORDER

Per N. K. Saini, AM:

1.

This is an appeal by the department against the order dated 22.09.2015 of ld. CIT(A)-40, New Delhi.

2.

The only effective ground raised

in this appeal reads as under: “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 payments are being made to a person specified u/s 13(3) of the I.T. Act.”

3. During the course of hearing, the ld. Counsel for the assessee at the very outset stated that this issue is covered in favour of the assessee vide order dated 13.09.2013 passed by the ITAT Delhi Bench ‘B’, New Delhi 2 East Point Education Society in for the assessment year 2009-10 in assessee’s own case (copy of the said order was furnished which is placed on record).

4.

In his rival submissions the ld. CIT DR could not controvert the aforesaid contention of the ld. Counsel for the assessee.

5.

After considering the submissions of both the parties and the material on record, it is noticed that an identical issue having similar facts has been decided in assessee’s favour vide aforesaid referred to order dated 13.09.2013 wherein the relevant findings have been given in para 8 which read as under: “8. We have heard the rival submissions of both the parties and have gone through the material available on record. We find that this issue of dispute is an old one and in the year 2006-07 the ITAT vide order dated 16th December, 2011 has decided the same in favour of assessee. The relevant portion of the ITAT order in para 35 & 36 are reproduced below:- 35. The issue about entries in respect of Mohinder Singh also was fully explained before lower authorities. From the proceedings before Hon'ble Delhi High Court, it clearly emerges that there are disputes among the members of the society. In the circumstances, it appears that instead of society's funds being used by specified member the situation is conversed. As depicted by litigation, the situation is Mr. Mohinder Singh claims to have borrowed the huge loans from bank and constructed building of the society, the loans are not being acknowledged or recorded by society.

3 East Point Education Society 36. In our view, lower authorities on merits also have failed to appreciate the relevant explanation given by the assessee. No case has been made out in objective terms to justify beneficial use of societies’ funds in favour of any member u/s 13(1)(c) r/w section 13(3). Consequently, we hold that the denial of registration u/s 11 is not justified which is restored." As regards the disallowance of claim of depreciation on assets purchased during earlier years, the issue is not before us as department has not taken this as a ground of appeal

. We observe that issue is same and is covered in favour of the assessee. Therefore, respectfully following the same we also decide this case in favour of the assessee.”

6. So, respectfully following the aforesaid referred to order dated 13.09.2013 in for the assessment year 2009-10 in assessee’s own case, we do not see any merit in this appeal of the department.

7.

In the result, the appeal of the department is dismissed. (Order Pronounced in the Court on 20/09/2017)

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