KATIANI EDUCATIONAL SOCIETY,KULLU vs. ACIT, CIRCLE, MANDI

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ITA 1326/CHANDI/2017Status: DisposedITAT Chandigarh09 April 2018AY 2010-114 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal dismissed Ground No. 1 as not pressed. For Grounds 2 to 5, the Tribunal restored the issues to the Assessing Officer, directing him to re-examine the evidence for expenses like concession of fees, repairs, fuel, and printing/stationery.

What were the facts?

The assessee, an educational society, appealed against the CIT(A)'s order which charged excess of income over expenditure to tax and disallowed various expenses. The assessee argued that the society was run for educational purposes and the expenses were genuine.

What were the issues?

Whether the CIT(A) erred in disallowing expenses claimed by the educational society due to lack of supporting bills and vouchers, and whether the society was profit-oriented.

Which sections of the Income-tax Act were involved?

Section 68

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DIVISION BENCH, ‘A’ CHANDIGARH

Before: SHRI SANJAY GARG & DR. B.R.R. KUMAR

Hearing: 09.04.2018Pronounced: 09.04.2018

Per Sanjay Garg, Judicial Member:

The present appeal has been preferred by the assessee against

the order dated 28.06.2017 of the Commissioner of Income Tax

[hereinafter referred to as CIT(A)], Palampur, H.P.

2.

The assessee has taken the following grounds of appeal:- 1. That under the facts and circumstances of the case and in law, Ld CIT (A) has erred in charging the "Excess of Income Over Expenditure" to tax to the tune of Rs. 1,32,814/- by drawing the inference that the society was existing for the motive of profit and profit is being siphoned through inflations of the expenses and excessive payments, ignoring the fact that the society is running educational Institution for the sole purpose of imparting education.

ITA No.1326/Chd/2017- Katiani Educational Society, Kullu 2

2.

That the Ld CIT(A) has erred in disallowing the deduction on account of expenditure as claimed by the assessee in respect to the "Concession of" fees" amounting to Rs 53,000/-- for the A.Y. 2010- 11 and adding it back to the income of the assessee by disregarding the fact that such expenditure is permissible under the Income Tax Act. 1961.

3.

That the Ld CIT (A) is wrong in disallowing the expenditure claimed by the assessee on account of repairs debited in the Income & Expenditure Account to the tune of Rs. 27,172/- on the mere ground that the assessee could not produce the bills and vouchers in support of the same, ignoring the fact that the assessee had produced various bills assessee had produced various bills on record to the Ld.CIT(A).

4.

That the Ld CIT (A) added back to the income of the assessee. The expenditure amounting to Rs 97,783/- claimed on account of fuel expenses and ignored the fact that such expenditures were genuine and not vague.

5.

The Ld. CIT(A) is wrong in affirming the order of Ld. Assistant Commissioner of Income Tax. Mandi in restricting the claim of appellant of deduction of expenditure claimed on account of Printing & Stationary for an amount of Rs. 85,392/-.

6.

The Appellant craves permission to add or amend any other ground of appeal with prior approval of the bench at the lime of hearing.

2.

At the outset, the Ld. Counsel for the assessee has stated at bar

that as per the instructions of his client, he does not want to press

ground No./1, therefore, the ground No.1 is dismissed as not pressed.

3.

The Ld. counsel has invited our attention to ground Nos. 2 to 5

of the appeal and stated that the disallowance relating to the items as

stated in ground Nos. 2 to 5, such as, concession of fees, repairs,

ITA No.1326/Chd/2017- Katiani Educational Society, Kullu 3

fuel expenses, printing and stationery etc., has been made by the

Assessing officer for want of bills, vouchers and confirmation from

the parties. At this stage, the Ld. Counsel for the assessee stated that

in fact the assessee produced the bills and vouchers before the

Assessing officer, however, it was not pointed out to the assessee as

about to which bills and vouchers the Assessing officer was not

satisfied. The Ld. Counsel for the assessee has stated that the

assessee may be given an opportunity to produce the relevant bills

and vouchers. He has claimed that assessee has relevant vouchers

with evidence and can prove the actual incurring of the aforesaid

expenditure for business purposes of the assessee. However, the Ld.

DR has relied upon the findings of the lower authorities.

4.

In our view, the interest of justice will be well served if the

assessee is allowed to demonstrate before the Assessing officer about

the actual incurring of the aforesaid expenses as detailed in ground

Nos. 2 to 5 of the appeal. We, therefore, restore the grounds bearing

Nos. 2 to 5 of the appeal to the file of the Assessing officer with a

direction to examine the relevant evidences, records as may be

furnished by the assessee in this respect and then to pass the order

afresh in accordance with law. It is also directed to the assessee to

submit the evidences promptly, as and when called for by the

Assessing officer, and not to seek unnecessary adjournments, failing

which, the Assessing officer will be at liberty to take appropriate

view as he may deem fit in the facts and circumstances of the case.

5.

Ground Nos. is general in nature and needs no adjudication.

ITA No.1326/Chd/2017- Katiani Educational Society, Kullu 4

6.

In the result, the appeal of the assessee is treated as partly allowed for statistical purposes. Order pronounced in the Open Court.

Sd/- Sd/- (B.R.R.KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 09.04.2018 Rkk Copy to: • The Appellant • The Respondent • The CIT • The CIT(A) • The DR

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