DAYA SAROOP USHA BHALLA WELFARE FOUNDATION TRUST,KOLKATA V. I.T.O., WARD - 1(2), EXEMPTION, KOLKATA

ITA 2306/KOL/2024

AI Insights

The case involves the Daya Saroop Usha Bhalla Welfare Foundation Trust, a charitable trust, which appealed against the order of the ld. Addl./JCIT(Appeals), Bhubaneswar, for the Assessment Year 2017-18. The trust had filed a return declaring a 'NIL' income, which was processed by the Centralizing Processing Centre, Bangalore, resulting in a taxable income assessment of Rs.11,43,658/- due to disallowance of deduction under section 11 of the Income Tax Act. The trust's subsequent rectification petition under section 154 was rejected, leading to the appeal before the ITAT. The primary contention was the lack of consideration of the case on merit by the ld. Addl./JCIT(Appeals), who merely upheld the Assessing Officer's order without substantial examination of the trust's claims or the documents provided.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 473194 (ITAT-KOLKATA)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside; Opportunity of being heard; Principle of natural justice
• Section: 154; 143(1); 11

Judgement Text

" ITA No. 2306/KOL/2024 (A.Y. 2017-2018) Daya Saroop Usha Bhalla Welfare Foundation Trust 1 IN THE INCOME TAX APPELLATE TRIBUNAL, ‘SMC’ BENCH, KOLKATA Before Shri Duvvuru RL Reddy, Vice-President (KZ) I.T.A. No. 2306/KOL/2024 Assessment Year: 2017-2018 Daya Saroop Usha Bhalla Welfare Foundation Trust,……………….………….……Appellant 45, Park Street, Kolkata-700016 [PAN:AABTD7252Q] -Vs.- Income Tax Officer,…………………………....Respondent Ward-1(2), Exemption, Kolkata, 10B, Sur William Jones Sarani, Middleton Row, Park Street Area, Kolkata-700071 Appearances by: Shri Anil Kochar, Advocate, appeared on behalf of the assessee Ms. Madhumita Das, Addl. CIT, appeared on behalf of the Revenue Date of concluding the hearing: January 09, 2025 Date of pronouncing the order: February 13, 2025 O R D E R The present appeal is directed at the instance of assessee against the order of ld. Addl./JCIT(Appeals), Bhubaneswar dated 19th September, 2024 passed for Assessment Year 2017-18. ITA No. 2306/KOL/2024 (A.Y. 2017-2018) Daya Saroop Usha Bhalla Welfare Foundation Trust 2 2. Brief facts of the case are that the assessee is a Charitable Trust, who filed his return of income on 31.03.2018 declaring total income at ‘NIL’. The return was processed under section 143(1) of the Act determining taxable income at Rs.11,43,658/- by disallowing deduction under section 11 of the Act. The tax liability was computed at Rs.1,09,616/-. The ITR was processed by Centralizing Processing Centre, Bangalore (CPC) without allowing deduction claimed under section 11 of the Act. Later on, the appellant filed petition under section 154 of the Act seeking rectification of mistake, which was also rejected. Being aggrieved, the appellant preferred appeal urging for reversal of the order of CPC. 3. The ld. Addl. /JCIT(Appeals) has given several opportunities to the assesese to substantiate its claim. The appellant was asked to provide supporting documents from which it could have been concluded that it was eligible for deduction under section 11 of the Act for A.Y. 2017-18. Mere claiming in the ITR that income has been applied for the object of the Trust is not enough to hold genuineness of the claim but the appellant did not file the written submissions. Thereafter the ld. Addl./JCIT(Appeals) dismissed the appeal on 19th September, 2024. 4. On being aggrieved, the assessee preferred an appeal before the ITAT. 5. At the time of hearing, it was the submission of the ld. Counsel for the assessee that ld. Addl./JCIT(Appeals) did not ITA No. 2306/KOL/2024 (A.Y. 2017-2018) Daya Saroop Usha Bhalla Welfare Foundation Trust 3 consider the case on merit, rather he just upheld the order passed by the ld. Assessing Officer. Therefore, he pleaded to delete the addition made by the ld. Assessing Officer as confirmed by the ld. Addl./JCIT(Appeals). 6. At the outset, ld. D.R. brought to my notice that the assessee did not produce the relevant documents as asked by the ld. Assessing Officer during the assessment proceedings. Therefore, the ld. Assessing Officer passed the assessment order assessing the taxable income at Rs.11,43,658/-which exceeds income or gross receipts of Rs.10,34,042/- by Rs.1,09,616/-. Thereafter the assessee preferred an appeal before the ld. CIT(Appeals). The ld. Addl./JCIT(Appeals) has given many opportunities to the assessee and the assessee neither filed written submission nor any evidence before the ld. Addl./JCIT(Appeals). He further submitted that before the ITAT, the assessee did not substantiate its claim. Therefore, he pleaded to uphold the orders passed by the revenue authorities. 7. I have heard the rival submissions and perused the material available on record. The assessee also filed additional documents before the Tribunal. The only contention of the ld. Addl./JCIT(Appeals) that the assessee has not provided any documents in support of its claim even after issuance of notices on three occasions. Therefore, ld. Addl./JCIT(Appeals) decided these issues on merit. However, before me, the assessee filed some documents. Considering the facts and circumstances of the case, I am inclined to set aside the order passed by the ld. CIT(Appeals) ITA No. 2306/KOL/2024 (A.Y. 2017-2018) Daya Saroop Usha Bhalla Welfare Foundation Trust 4 in order to meet the principle of natural justice, and remit the matter back to the file of ld. CIT(Appeals) with a direction to provide one more opportunity of being heard to the assessee. At the same breath, I also hereby caution the assessee to promptly co-operate with the proceedings before the Ld. CIT(Appeals) failing which the Ld. CIT(Appeals) shall be at liberty to pass appropriate order in accordance with law and merits based on the materials available on the record. Thus, the grounds raised by the assessee are allowed for statistical purposes. 8. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 13/02/2025. Sd/- (Duvvuru RL Reddy) Vice-President (KZ) Kolkata, the 13th day of February, 2025 Copies to :(1) Daya Saroop Usha Bhalla Welfare Foundation Trust, 45, Park Street, Kolkata-700016 (2) Income Tax Officer, Ward-1(2), Exemption, Kolkata, 10B, Sur William Jones Sarani, Middleton Row, Park Street Area, Kolkata-700071 (3) Addl./JCIT(Appeals), Bhubaneswar; ITA No. 2306/KOL/2024 (A.Y. 2017-2018) Daya Saroop Usha Bhalla Welfare Foundation Trust 5 (4) CIT - ; (5) The Departmental Representative; (6) Guard File TRUE COPY By order Assistant Registrar, Income Tax Appellate Tribunal, Kolkata Benches, Kolkata Laha/Sr. P.S. "