DEPUTY COMMISSIONER OF INCOME TAX(EXEMPTIONS) CIRCLE-2, CHANDIGARH, CHANDIGARH V. SHRI SHIV NARAIN SIDHESWAR MANDIR BAGH SANATAN DHARAM SABHA, GURGAON

ITA 633/CHANDI/2025

AI Insights

The case involves the Deputy Commissioner of Income Tax (Exemptions), Circle \\u2013 2, Chandigarh as the appellant and Shri Shiv Narain Sidheswar Mandir Bagh Sanatan Dharam Sabha as the respondent. The dispute centered on the assessee's entitlement to exemption under Section 11(2) of the Income Tax Act, 1961 for the assessment year 2018-19. The Revenue challenged the CIT (Appeals)'s decision which allowed the assessee's claim despite the initial rejection by the Assessing Officer (AO) due to the non-specific declaration of the purpose of accumulated income in Form No. 10. The CIT (Appeals) relied on a judgment by the Hon'ble Gujarat High Court, which supported the assessee's position.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 779390 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-10-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2018-2019
• Appeal Filed On: 30-04-2025
• Other Referred Cases: CIT Vs Bochasanawasi Shri Akshar Purshottam Public Charitable Trust (2019) 102 taxmann.com 122
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KUSUM BA NSAL
• Assessee Lawyers: ARJUN CHATURVEDI
• Keywords: Charitable institution
• Section: 2

Judgement Text

"आयकर अपीलȣय अͬधकरण,चÖडीगढ़ Ûयायपीठ, चÖडीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, ‘B’ CHANDIGARH BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT AND SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER आयकर अपील सं./ ITA No. 633/CHD/2025 Ǔनधा[रण वष[ / Assessment Year: 2018-19 The DCIT (Exemptions), Circle – 2, Chandigarh. Vs Shri Shiv Narain Sidheswar Mandir Bagh Sanatan Dharam Sabha, Gurudwara Road, Gurgaon. èथायी लेखा सं./PAN NO: AACTS6273M अपीलाथȸ/Appellant Ĥ×यथȸ/Respondent Assessee by : Shri Arjun Chaturvedi, CA Revenue by : Smt. Kusum Bansal, CIT DR Date of Hearing : 07.10.2025 Date of Pronouncement : 13.10.2025 VIRTUAL HEARING O R D E R PER RAJPAL YADAV, VP The Revenue is in appeal before the Tribunal against the order of ld. Commissioner of Income Tax (Appeals) [in short ‘the ld.CIT (A)’] dated 21.02.2025 passed for assessment year 2018-19. 2. In the solitary ground of appeal Revenue has pleaded that assessee has not submitted Form No. 10 as contemplated in Printed from counselvise.com ITA No.633/CHD/2025 A.Y.2018-19 2 Section 11(2) of the Income Tax Act, 1961 therefore, it is not entitled for exemption u/s 11(2) of the Income Tax Act. 3. With the assistance of the ld. Representative, we have gone through the record carefully. It emerges out from the record that assessee has filed its return of income on 27.09.2019 declaring ‘nil’ income. The case of the assessee was selected for scrutiny assessment. A perusal of the record would reveal that assessee has claimed accumulation of income at Rs.3,94,63,021/-. However, declaration in Form-10 was construed as not specific. According to the AO, assessee has not declared the purpose for which this accumulated income would be used in future, therefore, he declined the benefit to the assessee. 4. Dissatisfied with the assessment order, assessee carried the matter in appeal before the CIT (Appeals). It has pointed out that it has revised the Form-10. The ld.CIT (Appeals) has gone through the record carefully and after putting reliance upon judgement of Hon'ble Gujrat High Court in the case of CIT Vs Bochasanawasi Shri Akshar Purshottam Public Charitable Trust (2019) 102 taxmann.com 122, CIT (Appeals) Printed from counselvise.com ITA No.633/CHD/2025 A.Y.2018-19 3 had deleted the disallowance and held that assessee will be entitled for benefit of Section 11(2) of the Act. 5. The ld. CIT DR took us through paragraph No. 5.1 to 5.4 of the assessment order. She contended that it was mandatory for the assessee to submit Form No.10 well in time and also disclosed the purpose of accumulation. In case assessee fails to disclose the purpose, then it is not entitled for the benefit. On the other hand, ld. counsel for the assessee relied upon the order of the CIT (Appeals). 6. The ld.CIT (Appeals) has held that when accumulation was made for its future utilization, then two hospital projects were coming up and modernization of existing institution was undergoing. The form was submitted well in time. The only ambiguity at the most could be, specific purpose might have not been mentioned in Form, but it is to be construed that accumulated funds, in any case, have to be applied for charitable activities i.e. qua objects of the assessee. The only difference could be, whether it will go to corpus funds or other revenue requirements of the Institution in its day-today running but in any case, the lapse was not such for which Printed from counselvise.com ITA No.633/CHD/2025 A.Y.2018-19 4 exemption u/s 11(2) could be denied. We are of the view that ld.CIT (Appeals) has decided the above issue in right perspective and we do not find any error in the order of the CIT (Appeals). Accordingly, appeal of the Revenue is dismissed. 7. In the result, appeal of the Revenue is dismissed. Order pronounced on 13.10.2025. Sd/- Sd/- (MANOJ KUMAR AGGARWAL) (RAJPAL YADAV) ACCOUNTANT MEMBER VICE PRESIDENT “Poonam” आदेश की Ůितिलिप अŤेिषत/ Copy of the order forwarded to : 1. अपीलाथŎ/ The Appellant 2. ŮȑथŎ/ The Respondent 3. आयकर आयुƅ/ CIT 4. िवभागीय Ůितिनिध, आयकर अपीलीय आिधकरण, चǷीगढ़/ DR, ITAT, CHANDIGARH 5. गाडŊ फाईल/ Guard File सहायक पंजीकार/ Assistant Registrar Printed from counselvise.com "