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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI A. MOHAN ALANKAMONY
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER:
All the appeals of the Revenue and assessee are directed against the common order passed by the Commissioner of Income Tax (Appeals) -17, Chennai, dated 05.08.2016 and pertain to
assessment years 2006-07, 2009-10, 2010-11, 2012-13 and 2013- 14. Since common issues arise for consideration in all these appeals, we heard these appeals together and disposing of the
same by this common order.
Let’s first take the assessee’s appeal for assessment year 2006-07 in I.T.A. No.3021/Chny/2016.
The only issue raised by the assessee is reopening of assessment under Section 147 of the Income-tax Act, 1961 (in short 'the Act').
Shri S. Sridhar, the Ld.counsel for the assessee, submitted that for the assessment year 2006-07, the assessment was completed under Section 143(3) of the Act after examining all the
material filed by the assessee. According to the Ld. counsel, the Assessing Officer subsequently found that the assessee set off
3 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
excess application of income brought forward to the extent of ₹1,03,58,210/- from the assessment year 2005-06. According to the Ld. counsel, the required material was already available before the Assessing Officer and the Assessing Officer allowed the claim of the assessee on the basis of the material. According to the Ld.
counsel, no fresh material came into the possession of the Assessing Officer, therefore, reopening of assessment in the absence of any new material is not justified.
On the contrary, Smt. Ruby George, the Ld. Departmental Representative, submitted that the assessee made a wrong claim of set off before the Assessing Officer. Therefore, according to the Ld.
D.R., the Assessing Officer is justified in reopening the assessment after recording his reasons. Since the Assessing Officer has not considered the claim of set off which was claimed by the assessee,
according to the Ld. D.R., the Assessing Officer has rightly reopened the assessment for assessing the income which was escaped from taxation in view of wrong claim of set off.
We have considered the rival submissions on either side and perused the relevant material available on record. It is not in
4 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
dispute that the original assessment was completed under Section
143(3) of the Act. Subsequently, the Assessing Officer found that the assessee had set off excess application brought forward to the extent of ₹1,03,58,210/- from the assessment year 2005-06. This claim of set off by the assessee was very much available before the
Assessing Officer when the assessment was made under Section 143(3) of the Act. Admittedly, no fresh material came into the knowledge / notice of the Assessing Officer.
The question arises for consideration is when the assessee had furnished all the required details and the Assessing Officer completed the assessment under Section 143(3) of the Act, can the
Assessing Officer reopen the assessment in the absence of any new material or information into his possession? An identical question was considered by the Madras High Court in TANMAC
India v. DCIT in Tax Case (Appeal) No.1426 of 2007 dated 19.12.2016. The Madras High Court found that when the entire material was available before the Assessing Officer, in the absence
of any new material, the Assessing Officer cannot reopen the assessment under Section 147 of the Act. The Madras High Court further found that Section 147 of the Act is not to extend the period
5 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
of limitation provided for completing the assessment. Unless and
until a new material was found on record by the Assessing Officer,
the completed assessment cannot be reopened on the basis of very
same material available on record. In view of this judgment of
Madras High Court, this Tribunal is of the considered opinion that
reopening of assessment for the assessment year 2006-07 is not
justified. Therefore, the consequential order passed by the
Assessing Officer cannot stand. Hence, the orders of both the
authorities below are set aside and the addition made after
reopening of assessment is deleted.
In the result, the assessee’s appeal for assessment year
2006-07 is allowed.
The Revenue also filed an appeal for the assessment year
2006-07 in I.T.A. No. 2984/Chny/2016. Since the reopening of
assessment is held to be not valid in the assessee’s appeal, this
Tribunal do not find any reason to entertain the Revenue’s appeal.
Accordingly, the Revenue’s appeal for assessment year 2006-07
stands dismissed.
6 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Now coming to assessment year 2009-10, the assessee
alone filed appeal in I.T.A. No.3022/Chny/2016.
The only ground raised by the assessee is with regard to addition of accumulated income of ₹1,23,41,310/-.
Shri S. Sridhar, the Ld.counsel for the assessee, submitted that this Tribunal for the assessment year 2009-10 in I.T.A. No.1044/Mds/2014 dated 15.05.2015 found that the matter needs to
be examined afresh. According to the Ld. counsel, the Tribunal further found that the issue of application of accumulated income for the assessment year 2004-05 upto 31.03.2008 is to be examined
while framing the fresh assessment. In view of above, the CIT(Appeals) found that the issue raised by the assessee is premature and infructuous. According to the Ld. counsel, when the
assessee has raised a specific issue, the CIT(Appeals) is not justified in rejecting the same as premature and infructuous.
On the contrary, Smt. Ruby George, the Ld. Departmental
Representative, submitted that this Tribunal in the assessee's own case for assessment year 2009-10 in I.T.A. No.1044/Mds/2014 found that the matter needs to be re-examined. Accordingly, it is
7 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
pending before the Assessing Officer. Therefore, according to the
Ld. D.R., remitting this issue once again to the Assessing Officer is
a premature one and the CIT(Appeals) has rightly rejected the
ground raised by the assessee.
We have considered the rival submissions on either side and
perused the relevant material available on record. It is not in
dispute that in the first round of litigation, this Tribunal in I.T.A.
No.1044/Mds/2014 by an order dated 15.05.2015, found that the
matter needs to be re-examined. This Tribunal further found that
the issue of application of accumulated income upto 31.03.2008
needs to be re-examined. Therefore, entertaining this issue at this
stage may be premature one as rightly found by the CIT(Appeals),
therefore, this Tribunal do not find any reason to interfere with the
order of the lower authority and accordingly the same is confirmed.
In the result, the assessee’s appeal for assessment year
2009-10 is dismissed.
Now coming to assessment year 2010-11, the assessee has
filed appeal in I.T.A. No.3024/Chny/2016 against the original
assessment order.
8 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
The only ground raised by the assessee is with regard to
depreciation of certain assets the cost of which was allowed as
application of income under Section 11 of the Act.
We heard Shri S. Sridhar, the Ld.counsel for the assessee
and Smt. Ruby George, the Ld. Departmental Representative. The
Apex Court in the case of CIT v. Rajasthan And Gujarati Charitable
Foundation Poona in Civil Appeal No.7186 of 2014 found that the
assessee is eligible for depreciation even though the cost of the
asset was allowed as application of income under Section 11 of the
Act. In view of the above, this Tribunal is unable to uphold the
orders of the authorities below. Accordingly, orders of both the
authorities below are set aside and the Assessing Officer is directed
to allow depreciation.
In the result, the assessee’s appeal for assessment year
2010-11 stands allowed.
Now coming to Revenue’s appeal for assessment year 2010-
11 in I.T.A. No.2985/Chny/2016.
9 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
The only ground raised by the Revenue is with regard to carry forward the excess application of ₹6,94,54,741/- to the subsequent years.
Smt. Ruby George, the Ld. Departmental Representative,
submitted that the CIT(Appeals), by following the judgment of Madras High Court in CIT v. Matriseva Trust (2000) 242 ITR 20, allowed the claim of the assessee by holding that the deficiency in
one year can be set off against the excess application of subsequent year. According to the Ld. D.R., the excess application of income, in a particular year cannot be adjusted with deficiency in another year.
We heard Shri S. Sridhar, the Ld.counsel for the assessee also. The CIT(Appeals) by placing reliance on the judgment of
Madras High Court in Matriseva Trust (supra) found that the assessee is eligible for carry forward the excess application of income against the shortfall in the succeeding year. We have carefully gone through the judgment of Madras High Court in
Matriseva Trust (supra). The Madras High Court by placing its reliance on the judgment of Rajasthan High Court in CIT v.
10 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Maharana of Mewar Charitable Foundation (1987) 164 ITR 439 and
on the judgment of Gujarat High Court in CIT v. Shri Plot
Swetamber Murti Pujak Jain Mandal (1995) 211 ITR 293, found that
the assessee is entitled to set off the excess application of the
earlier year against the deficiency in the next year. This Tribunal is
of the considered opinion that since the CIT(Appeals) has followed
the judgment of jurisdictional High Court, which is binding on all the
authorities, the Revenue cannot have any grievance at all.
Therefore, the order of the CIT(Appeals) is confirmed.
In the result, the Revenue’s appeal for assessment year
2010-11 is dismissed.
Both the assessee and Revenue filed appeals for the
assessment year 2010-11 after reopening of assessment under
Section 147 of the Act.
Let’s first take Revenue’s appeal in I.T.A.
No.2986/Chny/2016.
The first ground of appeal is with regard to activity of the
assessee.
11 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Smt. Ruby George, the Ld. Departmental Representative,
submitted that the assessee is running two Kalyana Mandapams in
the name of Rajah Muthiah Hall and Rani Meyammai Hall.
According to the Ld. D.R., running of Kalyana Mandapams is a
commercial activity, therefore, it would attract the proviso to Section
2(15) of the Act. Hence, according to the Ld. D.R., the assessee
cannot be considered to be a charitable institution.
On the contrary, Shri S. Sridhar, the Ld.counsel for the
assessee, submitted that the assessee is registered under Section
12AA of the Act as charitable institution. According to the Ld.
counsel, the assessee can have business under trust. The income
of the business has to be applied only for charitable activity.
According to the Ld. counsel, the assessee is running two hostels
one for working women and another one for girl students studying in
Ethiraj Women’s College. The income from two Kalyana
Mandapams are applied for running the hostels and other charitable
activities. So long as the activity of the trust is not in doubt, and the
Kalyana Mandapams were held under trust, according to the Ld.
12 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
counsel, the CIT(Appeals) has rightly allowed the claim of the
assessee.
We have considered the rival submissions on either side and
perused the relevant material available on record. We have also
carefully gone through the provisions of Section 11 of the Act. It is
not in dispute that Rajah Muthiah Hall and Rani Meyammai Hall
were held under trust by the assessee-charitable institution. The
income of the trust was applied for running women’s hostels for
working women and girl students mostly studying in Ethiraj
Women’s College. The CIT(Appeals) referred the judgment of
Madras High Court in DIT v. Willington Charitable Trust (2011) 330
ITR 24. The High Court found that when the assessee established
that the income derived from business was utilised towards
fulfilment of object of the trust, then the assessee is entitled for
exemption under Section 11 of the Act. We have carefully gone
through the provisions of Section 11(4) and 11(4A) of the Act. It is
not the case of the Revenue that the income from two Kalyana
Mandapams is not used for charitable activity. The CIT(Appeals) in
the impugned order has held as follows:-
13 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
“To sum up therefore, in so far as invoking Sec.2(15) r.w.s. 13(8) of the Act is concerned by the respective A.Os in the impugned assessments, thereby denying the benefit of Sec.11 to the instant appellant is legally untenable and clearly unjustifiable since as per the provisos to Sec.2(15), the advancement of any other object of general public utility shall not be a charitable purpose if it involves carrying on activities in the nature of trade, commerce or business or any activity of rendering services in relation to trade, commerce or business as stated earlier, and since in the instant case, based on the above discussion and also held that the assessee was committed to charitable objects of education, medical relief and relief of the poor in a constant and consistent manner and in view of the definition of charitable purpose u/s 2(15) as clarified by the CBDT Circular 11/2008 dt. 19.12.2008, relevant portions of which has been extracted supra, wherein it has been categorically held that the newly inserted provisos to Sec.2(15), on which AOs have heavily relied in order to deny exemption to the instant appellant, would not apply in respect of the first three limbs which the appellant was involved in and which would squarely constitute ‘charitable purpose’ even if it incidentally involved carrying on commercial activities, as admittedly it was in the case of the instant appellant and further admittedly since the registration u/s 12A of the Act as a charitable trust was granted from as far back as 1974 and such registration having not been revoked till date and further since letting out of the aforesaid properties including kalyanamandapams, working/girl students hostel and auditorium etc are only to achieve the objects of the appellant trust, the provisos to Sec.2(150 has no application to the assessee’s case as also held in an almost identical case, relevant to the AY 2010-11, i.e. after the coming into effect of the aforesaid provisos, in ITAT, Chennai order vide ITA No.2272/Mds/2013 dt.09.01.2015 for A.Y. 2010-11 in the case of DDIT(E)-II Vs Sri Narayana Guruviah Chetty Estate.
14 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Therefore, in view of above discussions and the binding ratio of the decision of the High Court in the assessee's own case quoted supra as also the jurisdictional ITAT judgment in the case of Sri Narayana Guruviah Chetty Estate and respectfully following the same, the running of the kalyanamandapams, hostels, auditoriums etc by the instant Society/Trust could be said to be incidental to the attainment of the objects of the instant Trust which remained constant and unchanged since its formation of charitable nature, including more particularly for education, medical relief and relief of the poor as stated earlier and since income arising there from was being utilized/applied too for the stated charitable objects of the assessee, albeit in many cases through other similarly placed charitable Trusts, having charitable objects particularly of the first three limbs of Sec.2(15), the instant appellant was therefore eligible for exemption u/s 11 including on the income derived undisputedly from the aforesaid properties held under trust and therefore the A.O. is directed to allow exemption u/s 11 of the Act in all the years in appeal where such claim has been made. In the result, this ground is allowed for all the three years the issue is raised in appeal.”
As rightly found by the CIT(Appeals), the income generated
is incidental to the charitable activity. Therefore, this Tribunal do not
find any reason to interfere with the order of the lower authority and
accordingly the same is confirmed.
The next ground of appeal is with regard to addition of ₹46.05 Crores towards construction of building known as “Sigappi
Aachi building”.
15 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Smt. Ruby George, the Ld. Departmental Representative, submitted that the assessee spent ₹46.05 Crores towards construction of 10-storeyed building known as “Sigappi Aachi building” over a period of five years from financial year 2006-07 to 2010-11. Subsequently, it was let out to corporate companies.
According to the Ld. D.R., the Assessing Officer found that the assessee has invested surplus funds in construction of the building. The assessee has let out the building known as “Sigappi Aachi
building” to various corporate companies and earning rental income. Therefore, according to the Ld. D.R., the primary activity of the assessee appears to be letting out the building and not doing any
charitable activity. According to the Ld. D.R., construction of commercial building and letting out the same to corporate companies amounts to business activity, therefore, proviso to
Section 2(15) of the Act comes into operation.
On the contrary, Shri S. Sridhar, the Ld.counsel for the assessee, submitted that the object of the trust is education and
medical relief besides other charitable activities as described in the trust deed. The conclusion of the Assessing Officer, according to the Ld. counsel, that the assessee is predominantly involved in
16 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
advancement of general public utility is not supported by any
material evidence. According to the Ld. counsel, the assessee was
registered as charitable institution which continues to carry on
educational and medical relief to poor besides other activities as
described in the trust deed. According to the Ld. counsel, in the
assessment year 2004-05, for the purpose of accumulated income,
the assessee filed Form No.10B showing the purpose for which the
income was accumulated. According to the Ld. counsel, the
assessee clearly disclosed in Form 10B that the surplus income
was accumulated for the purpose of constructing building for
carrying out charitable activities. Therefore, according to the Ld.
counsel, proviso to Section 2(15) of the Act has no application in the
case of the assessee. According to the Ld. counsel, letting out the
building to corporate companies and running of Kalyana
Mandapams, auditorium, hostel for students and working women
are incidental to the main object of the assessee-trust. Therefore,
according to the Ld. counsel, proviso to Section 2(15) of the Act has
no application at all. Referring to proviso to Section 2(15) of the Act
and CBDT circular, the Ld.counsel submitted that proviso to Section
2(15) of the Act will not be applicable to educational and medical
17 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
trust. It is applicable only in respect of the trusts which are
rendering service in trade, commerce or business. In this case, the
main object of the trust is not business, trade or commerce or
rendering any service to trade. Therefore, according to the Ld.
counsel, the amendment made by the Parliament by inserting the
proviso to Section 2(15) of the Act is not applicable at all.
Shri S. Sridhar, the Ld.counsel for the assessee, further
submitted that the assessee-trust was established in the year 1924.
Referring to the judgment of Apex Court in ACIT v. Surat City
Gymkhana (2008) 300 ITR 214, the Ld.counsel submitted that once
the assessee-trust was registered under Section 12AA of the Act
and the registration continues till date, the A.O. cannot probe into
the objects of the trust. What the Assessing Officer can do is he
can verify whether the assessee is carrying on the activity in
furtherance of its object for which it was established. According to
the Ld. counsel, the Assessing Officer cannot say that the object of
the trust is not charitable one. It is for the Director of Income Tax
(Exemptions) to examine the same in case the activity was not
carried on as per the object of the trust as provided in Section
12AA(3) of the Act. Therefore, according to the Ld. counsel, the
18 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Assessing Officer is not correct in saying that the assessee is
carrying on business activity. According to the Ld. counsel, the
rental income from “Sigappi Aachi” building was used for carrying
out the charitable activities in furtherance of the object of the trust.
We have considered the rival submissions on either side and
perused the relevant material available on record. The assessee
invested its funds in construction of building known as “Sigappi
Aachi building” and let out the same to corporate companies. The
Assessing Officer holds that construction of building known as
“Sigappi Aachi building” and letting out the same to various
corporate entities amounts to engaging in business activity. This
Tribunal is of the considered opinion that when the assessee
constructed a building and let out the same to corporate entities and
received rental income and the same was applied for object of the
trust, it cannot be said that the assessee is carrying on business
activity.
Charitable activity cannot be carried on without money. In
other words, to carry out the object of the trust, the assessee needs
money and income. Therefore, it is for the assessee to generate
19 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
income from the property held under trust. When the assessee
exploited the land by putting up a construction and letting out the
same with an intention to generate income for the purpose of
carrying on the object of the trust, this Tribunal is of the considered
opinion that the construction of such building and letting out the
same cannot be considered to be a commercial activity. Therefore,
the CIT(Appeals) has rightly found that the assessee is eligible for
exemption under Section 11 of the Act. Therefore, this Tribunal do
not find any reason to interfere with the order of the lower authority
and accordingly the same is confirmed. A similar view was taken by
this Tribunal in the case of DDIT(E)-II v. Sri Narayana Guruviah
Chetty Estate in I.T.A. No.2272/Mds/2013 dated 09.01.2015.
In the result, Revenue’s appeal in I.T.A. No.2986/Chny/2016
is dismissed.
Now coming to the assessee’s appeal for assessment year
2010-11 in I.T.A. No.3023/Chny/2016 after reopening of
assessment, the first issue arises for consideration is validity of
reopening of assessment.
20 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
We heard Shri S. Sridhar, the Ld.counsel for the assessee
and Smt. Ruby George, the Ld. Departmental Representative. From the orders of the lower authorities it appears that an amount of ₹1,25,00,000/- accumulated under Section 11(2) was added back under Section 11(3) of the Act to the total income on the ground that
the assessee had not applied for the purpose for which it was accumulated. While passing revisional order under Section 263 of the Act for the assessment year 2005-06 pursuant to the order of
the High Court, according to the Ld. counsel for the assessee, the accumulated income for assessment year 2004-05 was deducted from the application of income made by the trust for assessment
year 2005-06 and hence the very same accumulated income cannot be subject matter of taxation.
On the contrary, Smt. Ruby George, the Ld. Departmental
Representative, submitted that though the assessee claimed that the accumulated income was used for charitable purpose, the Assessing Officer found that the application was made out of the
donation, therefore, the assessment was rightly reopened.
21 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
We have considered the rival submissions on either side and
perused the relevant material available on record. The Assessing Officer found that the assessee applied the income out of donation. But the information regarding donation was not available before the Assessing Officer. Moreover, consequent to the order of the High
Court, the Principal Commissioner revised the order of the Assessing Officer. In those circumstances, this Tribunal is of the considered opinion that the Assessing Officer has rightly reopened
the assessment. Therefore, this Tribunal do not find any reason to interfere with the order of the lower authority for reopening the assessment under Section 147 of the Act.
Now coming to addition of ₹1,25,00,000/-, the Assessing 43. Officer found that the amount accumulated under Section 11(2) of the Act was added back under Section 11(3) of the Act and the
same was not applied for the purpose for which it was accumulated. The Assessing Officer found from the material available on record that the application of income was made from the income which was
received as donation. Referring to Explanation to Section 11(2) of the Act and the CBDT Circular No.8 dated 27.08.2002, the CIT(Appeals) confirmed the order of the Assessing Officer. When
22 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
the assessee accumulated income for specific purpose, and
disclosing the same in Form 10B but such accumulated income was
not used for the purpose for which the same was accumulated, this
Tribunal is of the considered opinion that the assessee is not
eligible for exemption in respect of such accumulated income.
Therefore, this Tribunal do not find any reason to interfere with the
order of the lower authority and accordingly the same is confirmed.
In the result, the assessee’s appeal in I.T.A.
No.3023/Chny/2016 is dismissed.
Now coming to Revenue’s appeals for assessment years
2012-13 and 2013-14 wherein common issues arise for
consideration.
The first issue arises for consideration is regarding the
activity of the assessee.
While considering the Revenue’s appeal for assessment year
2010-11, this Tribunal found that the activity of the trust is education
and medical relief besides other activities. The assessee was also
granted registration under Section 12AA of the Act. Therefore, this
23 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
Tribunal do not find any reason to interfere with the order of the
lower authority and accordingly the same is confirmed.
The next common issue is with regard to construction of
building known as “Sigappi Aachi building” and the expenditure
incurred thereon. The Revenue has also raised an issue with
regard to income from Kalyana Mandapams. This issue was also
elaborately considered in the earlier part of this order. This Tribunal
found that it is incidental to the main activity of the assessee. For
the same reason, the order of the CIT(Appeals) is confirmed.
The next issue raised by the Revenue is with regard to
exemption claimed by the assessee under Section 80G of the Act.
We heard Smt. Ruby George, the Ld. Departmental
Representative and Shri S. Sridhar, the Ld.counsel for the
assessee. From the material available on record it appears that the
assessee made donation in respect of the trust which was granted
approval under Section 80G of the Act, from and out of current
profit. When the assessee has advanced money to the trust which
has similar object and approved under Section 80G of the Act, from
and out of current profit, this Tribunal is of the considered opinion
24 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
that the assessee is eligible for exemption under Section 11 of the
Act. Therefore, this Tribunal do not find any reason to interfere with
the order of the lower authority and accordingly the same is
confirmed.
In the result, both the appeals of the Revenue are dismissed.
Now coming to the assessee’s appeals for assessment years
2012-13 and 2013-14 in I.T.A. Nos.3025 & 3026/Chny/2016, the
only common issue arises for consideration in both the appeals is
with regard to claim of depreciation in respect of the asset on which
the cost was allowed as application of income under Section 11 of
the Act.
We heard Shri S. Sridhar, the Ld.counsel for the assessee
and Smt. Ruby George, the Ld. Departmental Representative. In
view of the judgment of Apex Court in CIT v. Rajasthan And Gujarati
Charitable Foundation Poona in Civil Appeal No.7186 of 2014, the
assessee is eligible for depreciation even on the asset on which the
cost was allowed as application of income under Section 11 of the
Act. Therefore, this Tribunal is unable to uphold the orders of the
lower authorities. Accordingly, orders of both the authorities below
25 I.T.A. Nos.2984 to 2988/Chny/16 I.T.A. Nos.3021 to 3026/Chny/16
are set aside and the Assessing Officer is directed to allow the depreciation.
In the result, both the appeals of assessee stand allowed. 55. To sum up the result, The assessee’s appeals in I.T.A. Nos.3021, 3024, 3025 and 3026/Chny/2016 are allowed and all other appeals of the assessee are dismissed, and all the appeals of the Revenue are dismissed.
Order pronounced on 19th April, 2018 at Chennai.
sd/- sd/- (ए. मोहन अलंकामणी) (एन.आर.एस. गणेशन) (A. Mohan Alankamony) (N.R.S. Ganesan) लेखा सद�य/Accountant Member �या�यक सद�य/Judicial Member चे�नई/Chennai, �दनांक/Dated, the 19th April, 2018.
Kri. आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. �नधा�रती /Assessee 2. Assessing Officer 3. आयकर आयु�त (अपील)/CIT(A)-17, Chennai-34 4. Principal CCIT, Tamil Nadu 5. CIT (Exemption), Chennai 6. �वभागीय ��त�न�ध/DR 7. गाड� फाईल/GF.