COMMISSIONER OF INCOME TAX V. ISLAMIC ACADEMY OF EDUCATION

ITA/715/2009

AI Insights

The case involves the Commissioner of Income Tax and the Assistant Commissioner of Income Tax as appellants, against the Islamic Academy of Education as the respondent. The dispute centers on the tax assessment for the year 2006-07, specifically regarding the status of the assessee as a Trust under Section 12AA of the Income Tax Act and the treatment of certain income items as unaccounted donations and profit on asset sales. The High Court of Karnataka at Bengaluru heard the appeal, which was filed under Section 260-A of the Income Tax Act, challenging the orders of the ITAT and the Appellate Commissioner.

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 728836 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 21-08-2015
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax vs. M/s.Islamic Academy of Education in ITA No.805/2008
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: S PARTHASARATHI; JINITA CHATTERJI; V K GURUNATHAN
• Assessee Lawyers: K V ARAVIND; E I SANMATHI
• Keywords: Assessment Year 2006-07; Income Tax; Trust; Unaccounted Donations; Profit on Sale of Asset
• Section: 11; 12AA; 11(5); 13(d)(i); 260-A; 13(2)(h)

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF AUGUST, 2015 PRESENT THE HON'BLE MR. JUSTICE VINEET SARAN AND THE HON’BLE MR. JUSTICE B.MANOHAR ITA NO.715/2009 BETWEEN 1 COMMISSIONER OF INCOME TAX C R BUILDING, ATTAVARA MANGALORE 2 THE ASST. COMMR. OF INCOME TAX CENTRAL CIRCLE, C R BUILDING ATTAVARA, MANGALORE ... APPELLANTS (BY SRI K V ARAVIND & E I SANMATHI, ADVs.) AND ISLAMIC ACADEMY OF EDUCATION ® NITHYANANDA NAGAR, DERALAKATTE MANGALORE ...RESPONDENT (BY SRI S.PARTHASARATHI, SMT. JINITA CHATTERJI & SRI V.K.GURUNATHAN, ADVs.) THIS ITA IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED: 12.6.2009 IN ITA 1399/BANG/2008 FOR THE ASSESSMENT YEAR 2006-07 PRAYING 2 TO ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE – I, BANGALORE. THIS ITA COMING ON FOR HEARING THIS DAY, VINEET SARAN J. DELIVERED THE FOLLOWING: JUDGMENT Heard Sri K.V.Aravind, learned counsel for the appellants and Sri S.Parthasarthi, learned counsel for the respondent and perused the record. 2. This appeal has been ADMITTED on the following questions of law: “i. Whether the Appellate Authorities were correct in holding that the assessee was to be treated in the status of Trust as the assessee had been granted registration under Section 12AA of the Act without appreciating that the assessee has contravened the provisions of Section 11(5) r.w.s.s 13(d)(i) and 13(2)(h) of the Act and therefore not exempted u/s.11 of the Act and should be treated as AOP as held by the Assessing Officer? 3 ii. Whether the Appellate Authorities were correct in holding that a sum of Rs.3,05,50,478/- treated as the income of the assessee as unaccounted donations, profit on sale of asset and other items after allowing depreciation and expenditure after deducting admitted income worked out to Rs.3,82,930/- by the Assessing Officer was liable to be set aside?” 3. Learned counsel for the parties have jointly submitted that the first question involved in this appeal is covered by the decision of this Court in the case of Commissioner of Income Tax –vs- M/s.Islamic Academy of Education in ITA No.805/2008 decided on 09.09.2014. 4. For the reasons given in the aforesaid judgment, the first question of law is decided in favour of the assessee and against the revenue. 5. As regards the second question, involving an amount of Rs.2,88,65,688/-which has been deleted as additional income 4 from the expenditure of the assessee for the year in question and the Tribunal has remanded the matter to the Commissioner of Income Tax appeals which had allowed the deletion. Since the matter has already been remanded to the Appellate Commissioner, we are of the view that as the matter is yet to be decided, thus in our opinion, no substantial question of law arises for determination by this Court. The appeal stands disposed of. No order as to costs. Sd/- JUDGE Sd/- JUDGE TL "