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Income Tax Appellate Tribunal, “H”
Before: SHRI R. C. SHARMA, AM &
DDIT (Exemption) 1(2) Sarva Siddhi Raja Mumbai, Ganapathy Trust, बिधम/ Pin- BhajanSamaj Complex, 90 Vs. Feet Road, Garodia Nagar, Ghatkopar(east) Mumbai- 400077 स्थायीलेखासं./जीआइआरसं./PAN No. AAJTS6521P (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : अपीलाथीकीओरसे/ Appellant by : Shri Mehul Shah, AR प्रत्यथीकीओरसे/Respondentby : Shri M. C. Omi Ningshen, DR सुनवाईकीतारीख/ : 07.02.18 Date of Hearing घोषणाकीतारीख / : 11.04.18 Date of Pronouncement आदेश / O R D E R
Per Sandeep Gosain, Judicial Member:
The present two Appeals have been filed by the assessee are against the order of Ld. Commissioner of Income Tax
Since the issues raised in these two appeals are identical, therefore, for the sake of convenience, these two appeals are clubbed, heard and disposed of by this consolidated order.
(AY 2009-10) 3. First of all we take up assessee’s appeal in (AY 2009-10)on the grounds mentioned herein below:- 1. On the facts, and in circumstances of the case, and in law, learned Commissioner of Income-tax (Appeal) erred in upholding action of the Assessing Officer in not granting exemption under section 11 of the Income- tax Act 1961 pending appeal before hon'ble ITAT, Mumbai with respect to rejection of Registration under section 12A of the Income-tax Act 1961. 2 On the facts, and in circumstances of the case, and in law, learned Commissioner of Income-tax (Appeal) erred in enhancing the income by RS. 2603,397 to assess the income on gross receipts of RS. 3,364,290 holding that since there was no effective Registration 3 I.T.A. No. 5159& 5160/Mum/2016 Sarva Siddhi Raja Ganapathy Trust available to the Appellant under section 12A, the Appellant did not qualify to be eligible for exemption under section 11 and not only that. no deduction could be allowed for application of money for charitable objects.
Your Appellant craves leave to add to, amend, alter, modify, and / or delete any of the above grounds of appeal at or before final disposal of appeal.
The brief facts of the case are thatassessee is a trust registered with Charity Commissioner. The assessee did not file return of income for the year under consideration, therefore notices u/s 148 dated 22.03.12 was issued. In response to the notice, copy of the return of income for A.Y. 2009-10 showing NIL income was sent through RPAD on 13.07.2012. Assessing Officer completed the assessment vide order dated 01.03.2013 u/-s. 143(3) r.w.s, 147 of the I.T. Act, 1961 at taxable income of Rs. 7,60,893/-.
In this case, the Assessing Officer has mentioned that the application for grant of registration u/s. 12A was rejected by Director of Income Tax (Exemption). Thereafter, the Assessing 4 5160/Mum/2016 Sarva Siddhi Raja Ganapathy Trust Officer has taxed the surplus income of Rs. 6,49,025/- after allowing depreciation and deduction for other expenses claimed in the Receipt and Expenditure Account.
Aggrieved by the order of AO, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) during the course of appellate proceedings, it was noted by Ld. CIT(A) that the action of the AO was not in consonance with the provision of section 11. Therefore, in view of the submissions made by assessee, the income of the assessee was enhanced by Rs. 26,03,397/- and ultimately the appeal filed by the assessee was dismissed with enhancement. Now before us, the assessee has preferred the present appeal by raising the above grounds.
Ground No. 1& 2. 5. These ground raised by the assessee are inter connected and inter related and relates to challenging the order of Ld. CIT(A)inupholding the action of AO in not granting exemption under section 11 of the Income-tax Act 1961 and in enhancing the income by Rs. 2,603,397 to assess the income on gross
We have heard counsels for both the parties at length and we have also perused the material placed on record as well as the orders passed by revenue authorities. We notice that the Ld. CIT(A) while passing the impugned order has considered the admission made by the assessee wherein the assessee admitted that in the absence of registration u/s 12A of the I.T. Act 1961, no amount applied towards the charitable or religious purpose during the previous year is allowable as deduction. Now before us, Ld. AR has relied upon the orders passed by the Coordinate Bench of Hon’ble ITAT in ITAT No. 7676/Mum/12 dated 10.11.17 in assessee’s own case for AY 2012-13 wherein the Hon’ble ITAT has already remanded back the matter to the file of DIT(Exmp) for afresh examination of assessee’s claim of registration u/s 12A of the I.T. Act. Ld. AR also challenged the order of Ld. CIT(A) by relying upon the principal laid down by Hon’ble ITAT in identical circumstances in the case of ITO Vrs. M/s Sri Balaji Education 6 5160/Mum/2016 Sarva Siddhi Raja Ganapathy Trust and Charitable Trust in ITA No. 789/Mds/2011 wherein it has been held by the Hon’ble ITAT, Chennai Bench ‘B’ that ‘even if there is no case of benefits available u/s 11 and 12 of the I.T. Act, the income in the hands of the assesse can be computed only on the basis of well principles laid down in the accountancy and taxation. The gross collection cannot be taxed as income. Corresponding expenditure necessary to carry on the activities should be deducted. The net alone can be taxed as income.’ Therefore, keeping in view the orders passed by Hon’ble ITAT in ITA No. 7676/Mum/12 in assessee’s own case and order passed in the case of ‘ITO Vrs. M/s Sri Balaji Education and Charitable Trust’ in ITA No. 789/Mds/2011, we set aside the order passed by Ld. CIT(A) and restore the matter back to the file of AO to pass afresh order after considering both the orders as referred above and keeping in view the decision of DDIT(Exmp), if any. It is needless here to mention that before passing the order, AO shall provide opportunity to the assessee and the assessee shall not take adjournment without a valid reason. It is 7 I.T.A. No. 5159& 5160/Mum/2016 Sarva Siddhi Raja Ganapathy Trust also made clear that assessee shall extend all necessary cooperation to the AO in expeditious disposal of this matter. Before parting, we may make it clear that our decision to restore the matter back to the file of AO shall in no way be construed as having any reflection or expression on the merits of the dispute, which shall be adjudicated by the AO independently in accordance with law. Resultantly these grounds raised by the assessee are allowed for statistical purposes.
Ground No. 3 & 4 7. These grounds are general in nature, thus requires no specific adjudication. 8. Now we take up assessee’s appeal in for AY 2013-14. Since we have already decided the similar grounds of appeal in AY 2009-10 and restore the matter back to the file of AO. Therefore, following our own decision in ITA No. 5159/Mum/16, we apply the same findings in the present appeal
In the net result, both the appeals filed by the assessee stands allowed for statistical purposes.
Order pronounced in the open court on 11th April, 2018 (R.C.Sharma) (Sandeep Gosain) लेखासदस्य / Accountant Member न्याययकसदस्य / Judicial Member मुंबई Mumbai;यदनांकDated : 11.04.2018 Sr.PS. Dhananjay