GANGARANI BALIKA VIDHYALYA,KANNAUJ vs. INCOME TAX OFFICER, GHAZIABAD

ITA 4007/DEL/2025Status: DisposedITAT Delhi27 August 2025AY 2018-19Bench: SHRI M. BALAGANESH (Accountant Member)5 pages
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What did the Tribunal hold?

The Tribunal held that deposit in a current account with a scheduled bank is a valid mode of investment under Section 11(5)(iii) of the Act. However, it remanded the matter to verify details regarding a cheque amount to determine if the assessee fully complied with the provisions.

What were the facts?

The assessee, a charitable trust, claimed exemption under section 11(2) of the Income-tax Act for accumulated surplus amounts kept in a current account. The Assessing Officer denied the exemption, holding that the current account is not a prescribed mode of investment.

What were the issues?

Whether funds kept in a current account by a charitable trust are eligible for exemption under Section 11(2) of the Income-tax Act, and if a cheque amount also qualifies as a valid investment.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 11(2),Section 11(5),Section 260A,Section 11(1A),Section 143(1)(a),Section 154,Section 11(5)(iii),Section 12A,Section 12AA,Section 11

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Income Tax Appellate Tribunal, DELHI BENCH “SMC”: NEW DELHI

For Appellant: Shri Vibhu Gupta, Adv
For Respondent: Shri Manoj Kumar, Sr. DR
Hearing: 13/08/2025Pronounced: 27/08/2025
1.

The appeal in ITA No.4007/Del/2025 for AY 2018-19 arises out of the order of the ld. National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/NFAC/S/250/2025- 26/1076220572(1) dated 15.05.2025 against the order of assessment passed u/s 143(3) of the Income-tax Act, 1961 dated 31.03.2021 (hereinafter referred to as ‘the Act’) by ITO, Exemption, Ward, Ghaziabad (hereinafter referred to as ‘ld. AO’).

2.

The only effective issue is to be decided in this appeal is to as to whether the surplus amounts which had not been applied for charitable purposes by the assessee trust, but kept in current account maintained with Bank of India would be eligible for exemption u/s 11(2) of the Act or not in the facts and circumstances of the instant case.

3.

I have heard the rival submissions and

The order continues below.

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