CVS ARADHANA CHARITABLE TRUST ,MUMBAI V. INCOME TAX OFFICER EXEMPTION-1(2), MUMBAI

ITA 5615/MUM/2025

AI Insights

The case involves CVS Aradhana Charitable Trust appealing against an order by the National Faceless Appeal Centre (NFAC) / CIT(A), which upheld the addition of Rs. 8,56,917 as income for the assessment year 2017-18. The trust argued that the contributions received towards its corpus, which were earmarked for a specific purpose, should not be considered income. Additionally, the trust contested the entire sum being taxed as income, asserting that only Rs. 2,00,000 should be taxable, as the balance was the opening balance of the corpus contribution account. The trust also challenged the computation of interest under sections 234B and 234C of the Income Tax Act, 1961. The tribunal found that the CIT(A) had not considered the trust's submissions and thus remanded the case back for a fresh decision.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 789796 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: misc
• Appeal Filed On: 10-09-2025
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJIV SHANKAR KADAM
• Assessee Lawyers: GUNJAN KAKKAD
• Keywords: Set aside; Principle of natural justice; Charitable institution; Audi alteram partem
• Section: 234B; 10B

Judgement Text

"1 IN THE INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER ITA No. 5615/Mum/2025 A.Ys: 2017-18 CVS Aradhana Charitable Trust 604, Divyalok, LD Ruparel Marg, Malabar Hill, Mumbai – 400006. PAN – AABTC6564C Vs ITO (E), Ward – 1(2) Pratishtha Bhavan, MK Road, New Marine Lines Mumbai. (Appellant) (Respondent) Assessee by Shri Gunjan Kakkad Revenue by Shri Rajiv Shankar Kadam, Sr. DR Date of Hearing 04.11.2025 Date of Pronouncement 27.11.2025 ORDER PER SANDEEP GOSAIN, JM: This appeal has been filed by the assessee challenging the impugned order dated 01.08.2025 passed under section 250 of the Income Tax Act, 1961 (‘the Act’), by the National Faceless Appeal Centre (NFAC) / CIT(A) for the assessment year 2017- 18. The assessee has raised the following grounds of appeal: Each ground is without prejudice to each other. The grounds of appeal are taken hereunder: Ground No. 1: Treating the contributions received towards corpus as income 1.1 On the facts and circumstances of the case and in law, the learned Additional/ Joint Commissioner of Income-tax Appeal (hereinafter referred to as \"first appellate authority\" for sake of Printed from counselvise.com 2 ITA No. 5615//Mum/2025 CVS Aradhana Charitable Trust., Mumbai. brevity] has erred in upholding the addition of Rs. 8,56,917/- as income for the assessment year 2017-18. 1.2 The Appellant submits that contribution received towards corpus was with a specified purpose and thus, a receipt which is stamped with an obligation can never be regarded as an income. Without prejudice to ground no. 1 Ground No. 2: Taxing entire sum of Rs. 8,56,917/- as income 2.1 On the facts and circumstances of the case and in law, the first appellate authority has erred in upholding the entire addition made to the total income of the Appellant without appreciating that during the year under consideration, only Rs. 2,00,000/- could be taxed as income and the balance amount of Rs. 6,56,917/- was opening balance of the corpus contribution account. 2.2 The Appellant submits that only the income which has accrued and/or received during the year under consideration could be taxed as income. Ground No. 3: Charge of interest under section 234B and 234C of the Act 3.1 On the facts and circumstances of the case and in law, the Appellant submits that the Income-tax Officer, exemption ward 1(2), Mumbai (hereinafter referred to as \"the AO\" for the sake of brevity) has wrongly computed interest under section 234B and 234C of the Act and that the said interest must be computed in accordance with law. 2. At the very outset, it was submitted by Ld. AR that Ld. CIT(A) while deciding the appeal has not considered the detailed submissions filed by the assessee which are at paper book page No. 50 to 51. It was further submitted that the provisions for filing Form – 10B was not applicable in the case of the assessee and has referred to page 48 in order to demonstrate that all the submissions filed before Ld. CIT(A) were uploaded. But Ld. CIT(A) has not considered the specific submission Printed from counselvise.com 3 ITA No. 5615//Mum/2025 CVS Aradhana Charitable Trust., Mumbai. filed by the assessee. Ld. AR further submitted that he wants to raise additional ground in the present appeal thereby challenging the order of assessment passed by AO as an association of person thereby rendering the assessment invalid. 3. On the contrary Ld. DR relied upon the orders passed by the revenue authorities. 4. I have heard the counsels for both the parties, perused the material placed on record, judgments cited before me and also the orders passed by the revenue authorities. From the records I noticed that assessee had taken specific stand that the additions made in the present case were not at all attracted and had filed detailed written submissions which are at paper book page No. 50 to 51. I have also perused the paper book page No. 48 which shows that the written submission filed before Ld. CIT(A) but Ld. CIT(A) without considering the same passed the impugned order, which otherwise was his statutory duty. 5. Be that as it may, without going into the merits of the issues and considering the submissions made by the parties, principles of natural justice and also keeping in view the doctrine of audi alteram partem, I set aside the order of Ld. CIT(A) and restore the matter back to the file of Ld. CIT(A) to decide the issues afresh after considering the written submissions filed and relied upon by the Printed from counselvise.com 4 ITA No. 5615//Mum/2025 CVS Aradhana Charitable Trust., Mumbai. assessee. The assessee shall be at liberty to raise any other ground not taken before Ld. CIT(A), thereafter Ld. CIT(A) shall decide all the issues raised before him in accordance with the provisions of law. Needless to mention after providing adequate opportunity to the assessee. 6. Before parting, we make it clear that my decision to restore the matter back to the file of the Ld. CIT(A) shall in no way be construed as having any reflection or expression on the merits of the dispute which shall be adjudicated by the Ld. CIT(A) independently in accordance with law. 7. Since I have allowed ground No. 1 and restored the matter back to the file of Ld. CIT(A) for deciding the issues afresh. Therefore other grounds raised by the assessee have become academic. 8. In the result the appeal filed by the assessee stands allowed for statistical purposes. Order pronounced in the open court on 27/11/2025 Sd/- (SANDEEP GOSAIN) (JUDICIAL MEMBER) Mumbai: Dated: 27/11/2025 KRK, Sr. PS. Printed from counselvise.com 5 ITA No. 5615//Mum/2025 CVS Aradhana Charitable Trust., Mumbai. Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By order (Asstt. Registrar) ITAT, Mumbai Printed from counselvise.com "