DEPUTY COMMISSIONER OF INCOME-TAX vs. SHIKSHANA PRASARAKA MANDALI,, PUNE

We find that the issues raised in all the appeals are similar basing on the same identical facts. Therefore, with the consent of both the parties, we proceed to hear all the appeals collectively and to pass a consolidated order for the sake of convenience.

First, we shall take up appeal in ITA No. 571/PUN/2016 for the A.Y. 2005-06 as a lead case.

The Revenue raised as many as four grounds of appeal amongst which the only effective issue emanates for our consideration is as to whether the CIT(A) justified in deleting the addition in respect of taxation of capitation fee alleged to have been received in cash by the assessee for admission of students in L N Welingkar Institute of Management under management quota.

The brief facts relating to the issue are that the assessee is a public charitable trust registered under the Bombay Charitable Trust Act and is running 61 educational institutions. The assessee runs reputed educational institutions one amongst them is L N Welingkar Institute of Management Development and Research. A search was conducted on 20- 11-2010 in the case of Dr. Uday Salunkhe, Director of L N Welingkar Institute of Management Development and Research. During search certain documents/loose papers belonging to assessee were seized. After recording satisfaction, the AO issued notice to the assessee u/s. 153C of the Act for entire block years for A.Ys. 2005-06 to 2011-12. This case was transferred to Pune in terms of the order passed by the Hon‟ble High Court of Bombay. In response to the above said notice u/s. 153C of the Act the assessee filed return of income declaring a total income of Rs. Nil. Notice

Having aggrieved by the order of CIT(A), the Revenue is before us.

Supporting the grounds, regarding the statements recorded u/s. 132(4) of the Act, the ld. DR, Shri Deepak Garg submits that during the search operation on Shri Uday Salunkhe, Director of Welingkar a document was seized from the drawer of Shri Samir Karkhanis (Head Marketing and key official of Welingkar) at his resident. In the statement recorded u/s. 132(4) of the Act, he explained that contents of the document contain the names of the students and amount of capitation fee received from them. His role as an interface with prospective students and their parents is clear from replies to Q‟s 6, 8, 9, 19 and 20 of the statement recorded u/s. 132(4) at page 37 to 42 of paper book filed by the assessee. His role in negotiating the cash donations with prospective students is evident replies to Q‟s 19 and 20 of the statement recorded u/s. 132(4) at page 37 to 42 of paper book filed by the assessee. He explained the complete modus operandi of admission process under management quota seats including the discretion of Institute's management and number of management quota seats replies to Q‟s 7, 16 to 22 of the statement recorded u/s. 132(4) at page 37 to 42 of paper book filed by the assessee.

Further, he submits that on the date of search, the statement of Ms. Kalpana Hans was also recorded u/s. 132(4) of the Act wherein she admitted her role in negotiation of capitation fee vide replies to Q‟s 4 to 9 of the statement recorded u/s. 132(4) at page 9 to 12 of paper book filed by the assessee. In addition, she also stated that Shri Pandurang Pawaskar, Shri Kanu Doshi are also involved in the process. She further confirmed that cash was being collected by office peons namely Shri Prakash Bekhare and Shri Ravi Sumbhe. Shri Pandurang Pawaskar also confirmed the statement of Ms. Kalpana Hans on the same day.

Likewise, he submits that, on the date of search, the statement of one Mr. Kanu Doshi was also recorded u/s. 132(4) of the Act wherein he confirmed his role in the admission process vide replies to Q‟s 6 and 17 of the statement recorded u/s. 132(4) at page 63 to 75 of the paper book filed by the assessee. He explained the complete admission process in the assessee‟s flow chart in reply to Q‟s 13 and 14 of the statement. He admitted that certain students who did not clear the cut-off marks in written test were also called for Interview and Group discussion and these

The ld. AR, Shri Dharmesh Shah, in reply, submits that the statements of said persons are not reliable and cannot be used against the assessee. It is submitted that these persons have later retracted the said statements on the very next day. Further, the affidavit of Retraction was filed within 25 days of the date of recording of the statement and within 1 day of allowing Kalpana Hans, manager-faculty compliance by the DDI (Inv.) to read through the said statements of all persons. Since the Assessing Officer was not satisfied with the said retraction, the said persons were cross examined during the course of assessment proceedings in the case of Dr. Uday Salunkhe, (the person searched) to verify the correctness of their affidavits. Even during cross-examination, these persons confirmed the averments made by them in their retraction affidavits.

Having heard both on this aspect, we note that the contention of the ld. DR is that the statement of Samir kharkanis recorded u/s. 132(4) of the Act in respect of seized document from his residence, Shri Samir Karkhanis explained his role with the prospective students and their parents regarding negotiations for cash donations, modus operandi, receipt of capitation fee not only for this A.Y. and also for passed 6 years. Further,

On perusal of the proceedings in respect of Ms. Kalpana Hans at page No. 9, in reply to Q. No. 2 she stated that her portfolio is to take care of compliance of statutory and regulatory bodies and meeting all the deadlines given by the Government bodies in the statement recorded u/s. 132(4) of the Act. In the retraction affidavit at page No. 21 of the paper book she stated that she was literally shocked to read contents made in the statement recorded u/s. 132(4) of the Act, further, she expressed her shock to read statements of Dr. Uday Salunkhe, Mr. Kanu Doshi, Mr. Samir Karkhanis, Mr. Prakash Bekhare and Ravindra Sumbe. In her retraction affidavit in para No. 12 she clearly stated that she has been unnecessarily implicated in the issues where she nowhere concerned either personally or in carrying out her duties in official capacity. Further, she stated she felt deeply pained, hurt, harassed, embarrassed and above all cheated by the officers of the entire search party by typing totally wrong,

Further, the ld. DR lead his submission as to why retraction of statements recorded u/s. 132(4) of the Act is not valid. It was submitted that the statement recorded u/s. 132(4) of the Act is of great evidentiary value and it is a well settled legal position that the same can be relied upon for making additions during assessment. Only exceptions to such admission where the statement are retracted (i) when the statement is recorded under coercion, threat, duress, undue influence, etc. Or (ii) when the facts recorded in the statement are incorrect. He argued that it is also a well settled legal position that mere bald retraction is not valid and the retraction should be backed by supporting documentary evidences. For example, where there are allegations of threat, coercion, etc. same has to be proved by the person. Also, where the person wants to retract the facts earlier stated and want to substitute the same with new

He contends that when confronted in cross examination, Ms. Kalpana Hans (Q‟s No. 33 and 34 page 30 of paper book) stated that besides herself and Shri Pawaskar no one else was there at the Notary on 16.12.2010. Shri Kanu Doshi (Q‟s 32 page 92 of paper book) stated that besides him, Ms. Kalpana Hans and Samir were there although Kalpana Hans denies it. When Samir was asked, he says that he has no idea as to who else besides him was there. Mr. Pawaskar says Mr. Kanu Doshi and Kalpana Hans were there. This clearly shows major contradictions in their statements during cross examination. It may also be noted that in reply to Q‟s 35 page 107, Mr. Pawaskar says that they were at notary at 3.00 PM while Mr. Kanu Doshi says that they were at Notary at 12.00 PM. This also shows the contradictions in their statements during cross examination. He vehemently argued that initially they took the stand that they filed retraction affidavit by themselves but when confronted and further probed during the cross examination, they came up with the fact that Mr. Gautam Parekh Chartered Accountant of Welingkar Institute arranged for their retraction affidavit. They also admitted that all the witnesses who signed the retraction affidavits were employees of Welingkar Institute. They also came up with the fact that the stamp papers were arranged by one Mr. Rajesh Bhuwad which clearly suggests that the Retraction Affidavits were filed at the instance of Welingkar Institute. Initially they maintained that they did not discuss about filing of retraction affidavit with anyone.

Shri Deepak Garg referred to the aspect of absence of coercion, threat, etc. during recording of statement u/s. 132(4) of the Act there was no allegation of any threat, coercion, pressure, etc. neither in the letter filed by these six persons on 21.11.2010 nor in the Affidavits filed on 16.12.2010. In the Affidavits filed on 16.12.2010, Mr. Samir Karkhanis has stated that the tax officials were very nice to talk to. Similar statement was made by Shri Kanu Doshi in the Affidavits filed on 16.12.2010. Neither any complaint regarding pressure or threat given by tax officials during recording of statement u/s. 132(4) was filed with any supervisory authority. None of these persons could file any evidence which could suggests that the statements u/s. 132(4) of the Act were recorded under threat or pressure, when they were confronted with this during cross examination, they could not substantiate that any threat or pressure was put on them. It is also important to mention that these persons were examined at three different locations at the same time and it is impossible to visualise that all of them were put under threat by different teams at the same time. The statement of Ms. Kalpana Hans and Mr. Pawaskar was recorded simultaneously and their submissions/replies are contained in one single statement. It is not possible to put pressure on two persons at the same time. It is important to mention that the witnesses who signed on the statements u/s. 132(4) of the Act were also examined by the AO and these witnesses denied the existence of any coercion/undue pressure during recording of statement in the course of search. He submits in force that there was no coercion, threat, undue pressure, etc. during recording of statement u/s. 132(4) of the Act during the course of search.

The ld. AR, Shri Shah submits that the aforesaid retraction was made by all the persons explaining the fact that the answers were written

Having heard both as to why retraction of statements recorded u/s. 132(4) of the Act is not valid, the contention of ld. DR is that the statement recorded u/s. 132(4) of the Act is of great evidentiary value and same can be relied upon for making additions during assessment, only exception to when the statement recorded under coercion, threat, duress, undue influence etc. and the facts recorded under statement are incorrect. According to ld. AR we note that the statement u/s. 132(4) of the Act were recorded on the whims and fancies of the such officers and they were not allowed to view and read what was being written at the time of recording statement. In the retraction affidavits with the cross-examination, as we already discussed in the aforementioned paragraph, regarding Ms. Kalpana Hans, we note that all the said persons explained the fact that there were surrounded by few officers out of which one of them was typing the questions based on the series of questions raised by another officers. The answers verbally given were typed by one officer who also took instructions from more than one officer and all of them signed such statements without reading the same as they were very tensed and frightened as they were surrounded and questioned by many officers. It is also pertinent to mention that all of them requested the DCIT to furnish the statement recorded u/s. 132(4) of the Act on the very next day of recording i.e. 21-11- 2010 and only Ms. Kalpana Hans could see her statement on 15-12-2010 the day prior to filing of retraction affidavit. In all the retraction affidavits all of them confirmed that the search officers recorded contrary to the

In the present case, there was no independent cogent evidence corroborating the statements of Ms. Kalpana Hans, Samir Karkhanis, Shri Kanu Doshi, Shri Pandurang Pawaskar, Shri Prakash Bekhare and Shri Ravi Sumbhe brought on record by the AO even after cross-examination of said persons. When there is no evidence doubting the correctness of the averments made in retraction affidavit, in the absence of any such evidence

Further, Shri Deepak Garg referred to statement of Mr. Samir Karkhanis in Retraction Affidavit are not backed by any supporting evidence. In his retraction, Shri Samir Karkhanis stated that the seized document contains the names of the students but the figures mentioned in the paper refers to the number of placements brochures and does not represents the amount of capitation fee. The same story was repeated by him in the cross examination before the assessing officer and even after retraction, Shri Samir Karkhanis admitted that the paper was written by him and it contains the names of the students of the institute. He also admitted that figures mentioned against each name are readable and belong to corresponding student only. What he retracted is that the figure mentioned against each student is not of capitation fee but of placement brochures. Besides this, he has admitted all other contents of the paper. He submits that when confronted about his new theory of 'placement brochures' during the cross- examination, he admitted that he is not an in- charge of distribution of placement brochures. He also stated that no record of students to whom brochures were given was maintained by the institute and denied of maintaining any data regarding the distribution of placement brochures. He also could not satisfactory explain as to why he was maintaining the data of placement brochures given to each student and could not give any specific reply as to why brochures in odd figures i.e. 22 brochures were given to any student. No documentary or supporting

The ld. AR submits that in the assessment order, the Assessing Officer has relied on seized page and it is submitted that during the course of search action, the officers had found some torn pieces of paper from the residence of Mr. Samir Karkhanis, employee of assessee and these pieces had been pasted on a paper in a dis-joint manner. The said coloured page filed before this Tribunal at page 175 proves that several torn pieces of paper were pasted in a very haphazard and disjoint manner such that the pasted pieces did not correlate with each other. The figures written on a piece of paper did not correlate with the names of the students written on another piece of paper dis-jointly pasted. As a result, no information could be discernible from the said page. Also other pieces pasted on the page did not convey any information. Some of the notings like "check more" suggest that these notings are not related to any capitation fees. Such a page only amounts to a dumb document which cannot be relied upon to come to any conclusion, much less, a definite conclusion that the figures written on the said page were figures of capitation fees accepted from the students. In this regard, reliance is placed on the decisions wherein it has been held that no addition can be made on the basis of a dumb document in the cases of S. P. Goyal Vs. DCIT [269 ITR 59 (Mum.)(AT)] [Page 481-505 of PB No. 3] (Refer Page 503 - from last para on the page) and CIT Vs. Maulikkumar K. Shah [307 ITR 137 (Guj.)] [Page 506-511 of PB No. 3] (Refer Page 508-511, Para 3 and 4).

The Assessing Officer has also relied upon the statements of various persons recorded at the time of search wherein the persons such as Kalpana Hans, Manager- Faculty (IT) Department, Samir Karkhanis, Head- Marketing and Business Development, Kanu Doshi, Head- Finance, Pandurang Pawaskar, Manager- Administrations, Prakash Bhekre, Peon

Having heard both on the aspect of retraction of Samir Karkhanis on seized document, the ld. DR contended that the Samir Karkhanis admitted the contents of seized document at page No. 175 were written by him but however in the retraction he said the figures mentioned therein represents placement brochures, is a new theory and afterthought. In reply the ld. AR contended that the search party found some torn pieces of paper from the residence of Samir Karkhanis and the said piece of paper had been pasted on a paper in a dis-joint manner and no information could be discernible from the said paper which is a dump document cannot be relied upon to come to any conclusion. Further, on perusal of the seized document which is placed at page No. 175 as rightly pointed out by the ld. AR that some torn pieces of paper were pasted in another paper in haphazard and dis- joint manner. The names and figures therein does not correlate with each other and nothing is discernible what could be the notings relating thereto. On top of the said document some figures are mentioned against some short code and nothing brought on record by the Revenue what does the said figures relates to and short code name to whom it represents, except stating that the figures represents capitation fee and since the said documents found with the Samir Karkhanis relates to assessee. Further, some names are mentioned wherein we note that after the Sl. Nos. 1, 2 and 3, the Sl. Nos. 4, 5 and 6 are missing. The figures mentioned against such names are different in some papers raising a doubt to whom the said figures refers to. Likewise, another set of names are there in the bottom of

Since, we held the retraction statements are valid in the aforementioned paragraphs, it is the duty of the Revenue to bring on any corroborative material evidence on record to prove that the assessee accepted capitation fee from the students and onus is on the Revenue to prove with corroborate evidence that the entries in the said seized document actually represents the capitation fee. There was no supporting evidence to hold that the figures represents in hard cash towards the capitation fee at Rs.20 lakhs per student. When the assessee claims the said figures are a mere entries of placement brochures and then the Revenue has to show some circumstantial evidence to support that those entries really represent cash of Rs.20 lakhs for each student and admittedly there was no such evidence found by the Revenue in the search in the form of actual cash. Thus, the mere entries found in the haphazard manner in the torn piece of paper are not sufficient to prove that the assessee has indulged in accepting capitation fee as the notings on such torn seized documents does not indicate the actual transaction. Therefore, the charge made by the AO is merely based on suspicion and surmises and there is no material whatsoever to support the conclusion of the AO. We take support from the order of Mumbai Benches ITAT in the case of S.P. Goyal reported in 269 ITR 59 which held the Revenue cannot reject the explanation offered by the assessee when there is no circumstantial evidence in the form of actual cash or extra cash supporting the mere entries found on a loose sheet. The decision of Hon‟ble High Court of

Shri Garg, further, canvassed that as to why the findings given by ld. CIT(A) should not be accepted. The ld. CIT(A) was incorrect to find that all these employees were not directly involved in the admission process and it is an incorrect finding because all six of them in their statements recorded u/s. 132(4) of the Act admitted their roles in admission process including negotiation, finalisation as well as collection of capitation fee. These statements were recorded sequentially as and when role of each one of them discovered during the search. All of them confirmed the statements of each other and there is no inconsistency in their admissions.

The ld. AR, Shri Shah submits that in any case, we further rely upon the letters received from All India Council for Technical Education (AICTE), Department of Technical Education, Maharashtra State (DTE) and Mumbai University wherein they have confirmed that the admission process has been conducted by the assessee as per the rules laid down by AICTE and DTE and that no complaints have been received by them regarding any irregularities. The Assessing Officer has not doubted or rebutted the said evidence filed by the assessee. The Ld.AR, further referred to the letter dated 26.06.2013 of the Assessing Officer of the person searched, i.e. DCIT, Central Circle 12, Mumbai addressed to AICTE (the Regulatory Body set up by Government) stating therein the facts relating to the present case and also complaining that the assessee was involved in accepting the capitation fees from students against law. In the said complaint the

The ld. AR submits that further, even the Assessing Officer has not been able to bring any evidence on record to prove that students have filed any complaint stating that they have paid capitation fees. The assessee relies upon the statement of the Assessing Officer recorded at the Police station at Pune in connection with a complaint against the said Assessing Officer. In the said statement, it has been accepted by him that he has verified all the seized documents as well as the Appraisal report of the Investigation wing and he has not found anything objectionable. He has

After hearing both, regarding statement of employees and complaints thereon to Government regulatory authorities, we note that the basing on the statements of employees together with the seized torn piece document the DCIT, Central Circle lodged a complaint to AICTE stating that the assessee was involved in accepting the capitation fee which is at page No. 180 of the paper book. In pursuance of such complaint the AICTE issued show caused notice to the assessee and in response to which the assessee submitted reply along with supporting documents. The AICTE put up the said case before the standing complaint committee consisting of Justice P.S. Patankar, Professor Manik Rao Solunke and Professor K. Tirumaran. After detailed discussion, the three members committee by referring to a letter dated 07-02-2013 issued by the western regional office of AICTE held that “there was anything wrong in the admissions and absolutely no evidence or any document suggesting that the assessee was charging capitation fees or donations”. The AICTE again put up the said report of three members committee before the One Man Justice P.C. Jain, committee for vetting/final opinion. The One Man Justice committee fully agreed with the report of three members committee. The relevant portion of page No. 188 is reproduced below for ready reference. “7. The above report of the Standing Complaint Committee was put up before the One Man Justice (Retd.) P.C. Jain Committee of the AICTE on 19.12.2014 for vetting/final opinion which had initially recommended for issue of Show Cause Notice in the above case. The opinion dated 19.12.2014 of Justice (Retd.) P.C. Jain is mentioned below :-

On perusal of the finding of the Hon‟ble One Man Justice committee clearly establishes that there was no evidence suggesting that the assessee charged capitation fee and consequent thereto the AICTE dropped the complaint against the assessee. Therefore, the arguments made by the ld. DR are rejected.

The ld. AR regarding exploration for earlier assessment years submits that the said addition also could not be held valid since the Assessing Officer does not have jurisdiction to make the addition in the hands of the assessee without any incriminating material found as a result of search. As evident from the assessment order, the only evidence in possession of the Assessing Officer was the torn document that the said evidence cannot be considered as incriminating and used against the assessee as the said seized page is not only a dumb document, but also the contents of the said seized page do not reveal any notings of receipt of capitation fees by the assessee. The addition made by the Assessing

In reply the ld. DR submits that in this connection, it may be submitted that Ms Kalpana Hans (reply to O. No. 8 and 9 of her 132(4) statement as well as Shri Samir Karkhanis statement have categorically admitted that capitation fee was charged in earlier 6 years as well. The quantification of capitation fee for preceding six years was also made on the basis of admission of Ms Kalpana Hans in the statement recorded u/s. 132(4) itself. Similar admissions were made by other employees as well. This clearly establishes that during the course of search proceedings, unaccounted transactions were found in earlier years as well. While completing the assessment u/s. 153C of the Act, the Assessing Officer was well within his rights to make additions in earlier assessment years as well. In view of the material found and statements recorded u/s 132(4) of the Act wherein similar transactions were admitted for earlier years also, the assessing officer is correct in making additions for earlier years as well.

What follows above discussion is that the statements given by the Kalpana Hans, Samir Karkhanis, Kanu Doshi, Pandurang Shankar, Prakash Bekhre and Ravindra Sumbhe u/s. 132(4) of the Act has no

In this regard, it is pertinent to note that the affidavit dated 07-05- 2012 deposed by Shri Ajay Chandra, Addl. Director of Income Tax (Inv.), Mumbai in connection with the proceedings in WP 5866/2011 before the Hon‟ble High Court of Bombay wherein he clearly stated that no incriminating document relating directly to assessee has been seized during the course of search proceedings but only document seized was an architect plan for building of assessee vide para No. 3. Therefore, it clearly shows no incriminating document seized relating to assessee and we find no mention of the torn piece document seized relating to assessee.

It is also important to note at page No. 192 of the paper book wherein the true English translation of statement recorded by Vishrambag Police Station, Pune is filed, the said investigation note which was recorded on 25-06-2014 of the AO by the Vishrambag Police, Pune wherein he clearly stated that he has checked/enquired with various students who have taken admission in Welingkar Institute during the assessment and all of them have confirmed that they have not paid any capitation fee at the time of admission which clearly establishes the charge of AO and as supported by the ld. DR is incorrect and supports the plea of ld. AR suggests that no student paid capitation fee to the assessee, in the absence of which the allegation that the assessee accepted capitation fee is based on mere suspicion and assumptions.

Thus, we find that there is no incriminating evidence found as a result of search action indicating undisclosed income. Therefore, we are of the considered opinion that the AO had failed to bring on record any material suggesting the receipt of capitation fee and there is no basis to infer that the assessee had been receiving capitation fee during any previous year relevant to the assessment years under consideration. In the absence of any incriminating material suggesting the undisclosed income, the question of extrapolation of addition in the previous year or subsequent year does not arise. Therefore, We do not find any reason to interfere with the orders of CIT(A) accordingly, it is justified. Thus, grounds raised by the revenue fails, hence, are dismissed.

The assessee raised an application under Rule 27 of the ITAT Rules questioning the validity of assessment order in question in the above appeal.

The ld. AR submits that the assessee has filed an application in Rule 27 of the Appellate Tribunal Rules challenging the validity of the assessment order for AY. 2005-06 to A.Y. 2011-12. He submits that all the assessments for A.Y. 2005-06 to AY. 2011-12 were unabated assessments and the notice u/s. 153C of the Act can be issued only if, in respect of the unabated assessments, any incriminating evidence was found as a result of search. The said torn piece evidence cannot be considered as incriminating as the said document is not only a dumb document, but also the contents of the said page do not reveal any notings of receipt of capitation fees by the assessee. The assessment in the present years cannot be made by the Assessing Officer by issue of notice u/s. 153C of the Act. He placed reliance on the Writ petition filed by the then Vice President of the assessee Trust in Shri Bal Jagannath Maharaj Pandit Vs. Addl. Director of Income-tax Investigation Unit IV, Mumbai in WP No. 5866 of 2011 before the Hon'ble Bombay High Court challenging the findings of the search action. He submits that in the said proceedings which were initiated pursuant to the search action conducted on 20.11.2010, the Additional Commissioner of Income-tax (Inv.) who was in charge of the investigation proceedings, vide his affidavit dated 7th May, 2012, filed before the Hon'ble Bombay High Court, confirmed that no incriminating document relating directly to the assessee Trust was found during the search. This also supports the contentions of the assessee that no incriminating evidence was found as a result of search and the Assessing Officer does not have jurisdiction to issue notice u/s. 153C of the Act and also pass assessment order for various years covered in appeal before Your Honour.

The ld. DR submits that the assessee has raised that no incriminating evidence was found during the search proceedings. The Ld. AR also took a plea that even if the seized document is considered an evidence, in that case also the said paper is for AY 2011-12 and no additions could be made for earlier assessment years. In this connection, it is submitted that the Rule 27 of ITAT Rules reads as under: 'The respondent, though he may not have appealed may support the order appealed against on any of the grounds decided against him"(emphasis supplied)”.

The ld. DR submits that no ground challenging the validity of proceedings u/s. 153C of the Act was admittedly raised for any assessment year before the Ld. CIT(A) and the Ld. CIT(A) has not decided any ground against the assessee. The grounds now raised under Rule 27 are not covered by the Rule 27. It is an established law that Rule 27 would not extend to permit the respondent to expand the scope of an appeal and assail the decision on issues, which are not subject matter of the appeal. It is also an established law that a party who has not appealed, cannot be permitted to raise a ground which will work adversely to the appellant. In the case of Shri Uday Sakunkhe wherein the assessee trust filed letter stating that addition on account of capitation fee, if any, should be made in the hands of the trust and not in the hands of the trustees or director of Welingkar. Same stand was maintained by the trust before the Ld, CIT(A) of Shri Uday Salunkhe and another letter was filed before him. The trust also stated that it will not raise any technical ground in its proceedings. Considering these letters from the trust and the grounds of appeal of the trust filed before Ld CIT(A) in trust's case, it was held that no addition in the hands of Shri Salunkhe can be made and additions were deleted without discussing the issue on merits. The Hon'ble ITAT while

After hearing both the parties we note that no ground questioning the validity of proceedings u/s. 153C of the Act raised for any of the assessments and no decision rendered by the CIT(A) on such validity of assessment. It is an established principle that Rule 27 would not extend to permit respondent-assessee scope of an appeal to question the decision on such issues which are not subject matter of the appeal. It is also decided that the assessee who has not appealed cannot be permitted to raise a ground which will adversely work against the appellant-revenue. Therefore, the application filed by the assessee under Rule 27 of the Rules fails and accordingly, dismissed.

In the result, the appeal of Revenue in ITA No.571/PUN/2016 is dismissed.

Both the sides are unanimous in stating that the grounds of appeal raised in ITA Nos. 572 to 577/PUN/2016 for AY‟s 06-07 to 11-12 are identical to the grounds raised in ITA No. 571/PUN/2016. Thus, in view of the fact that the issues in the appeals are identical and are arising from same set of facts the findings given by us while adjudicating the appeal in ITA No.571/PUN/2016 would mutatis mutandis apply to the appeals in ITA

To sum up, all the appeals of the Revenue are dismissed.