DEPUTY COMMISSIONER OF INCOME TAX (EXEMPTIONS), COIMBATORE V. THE KUNNATHUR KONGU VELLALAR TRUST, ERODE

ITA 2550/CHNY/2024

AI Insights

The case involves the Deputy Commissioner of Income Tax (Exemptions), Coimbatore as the appellant and the Kunnathur Kongu Vellalar Trust as the respondent. The appeal pertains to the assessment year 2018-19 and arises from an order by the CIT(A) dated 28.08.2024, which was based on an assessment framed by the AO under sections 147 and 144B of the Income-tax Act, 1961. The AO had reopened the assessment due to substantial cash deposits in the trust's bank account but accepted the trust's explanation during the reassessment, leading to no additions in the income. The CIT(A) supported the trust's position, leading to the Revenue's appeal, which was dismissed by the Tribunal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 107539 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2018-2019
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R. ANITHA
• Assessee Lawyers: T.S. LAKSHMI VENKATRAMAN
• Keywords: Capital expenditure
• Section: 147; 148

Judgement Text

"आयकर अपीलीय अिधकरण, ’सी’ \u0010ा यपीठ, चे\u0015ई। IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH: CHENNAI \u0018ी यस यस िव\u001aने\u001c रिव, \u0010ा ियक सद\u001e एवं \u0018ी जगदीश, लेखा सद\u001e क े सम& BEFORE SHRI SS VISWANETHRA RAVI, JUDICIAL MEMBER AND SHRI JAGADISH, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.2550/Chny/2024 िनधा 6रण वष6 /Assessment Year: 2018-19 The Dy. Commissioner of Income Tax (Exemptions), Coimbatore. Vs. The Kunnathur Kongu Vellalar Trust, Kongu Matri School Campus, Athiyur Road, Kunnathur – 638 452. [PAN: AAATT 2182Q] (अपीलाथ\u0007/Appellant) (\b\tयथ\u0007/Respondent) अपीला थE की ओर से/ Assessee by : Shri T.S. Lakshmi Venkatraman, FCA (virtual) GHथE की ओर से /Revenue by : Ms. R. Anitha, Addl. CIT सुनवा ई की ता रीख/Date of Hearing : 29.01.2025 घोषणा की ता रीख /Date of Pronouncement : 12.03.2025 आदेश / O R D E R PER JAGADISH, A.M : Aforesaid appeal filed by the Revenue for Assessment Year (AY) 2018-19 arises out of the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi [hereinafter “CIT(A)”] dated 28.08.2024 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s. 147 r.w.s 144B of the Income-tax Act, 1961 (hereinafter “the Act”) on 27.03.2023. ITA No.2550/Chny/2024 :- 2 -: 2. The grounds raised by the Revenue are as under: “Whether Ld. CIT(A) is justified in allowing the expenditure claimed when the assessee failed to comply with the statutory time- limits in filing the Return of Income and Audit Report within the due date which is a mandatory requirement for claiming the exemption u/s 11/12 of the Act and there is no order received by the assessee from prescribed authority condoning the delay in filing return of income and audit report. 2. Any other reason that may be adduced at the time of hearing.” 3. The assessee is a trust and running a Metric Higher Secondary School. The A.O has reopened the assessment for the reason that the assessee has cash deposits of Rs. 1,52,28,700/- in Indian Overseas Bank . In response to notice u/s. 148 of the Act, the assessee has filed return of income showing total income of Rs. 2,51,200/-. The A.O in the order passed u/s. 147 of the Act has accepted the assessee’s explanation of cash deposit and recorded that no addition is made and assessed income accordingly. However, in the computation sheet he has computed tax on income of Rs. 2,05,90,503/-. On appeal, the Ld. CIT(A) deleted the addition holding that if no addition has been made in the assessment order and income has been assessed at Rs Nil, the computation cannot be made at income different from income assessed. ITA No.2550/Chny/2024 :- 3 -: 4. Ld DR argued that assessee has not filled return within date, so benefit of allowing capital expenditure as application cannot be granted, therefore A. O has computed tax on gross receipt. 4. The Ld. Authorized Representative, on the other hand, has supported the order of Ld. CIT(A) and submitted that the assessee has filed return of income showing total income of Rs. 2,51,200/- and the A.O in the assessment order has not made any addition and therefore, computation of tax at the income of Rs. 2,05,90,503/- is not justified. 5. We have heard the rival submissions, and perused the materials available on record. We find that the A.O has reopened the assessment for the reason that the assessee had cash deposits of Rs.1,52,28,700/- in its bank account. However, in the assessment order, the explanation provided by the assessee was accepted, and no addition was made. The Ld. CIT(A) has accordingly held that when no addition has been made in the assessment order and the income has been assessed at Nil, the computation cannot be made at income different from income assessed. We note that assessing officer has not made any addition in the assessment order passed u/s 147 of the Act and has accepted assessee’s explanation for which the case was ITA No.2550/Chny/2024 :- 4 -: reopened. Therefore, we do not find any infirmity in the order of Ld. CIT(A) and hence, the appeal filed by the Revenue is dismissed. 6. In the result, the appeal filed by the Revenue is dismissed. Order pronounced on 12th March, 2025. Sd/- Sd/- (यस यस िव\u001aने\u001c रिव) (SS Viswanethra Ravi) \u0001याियक \u0001याियक \u0001याियक \u0001याियक सद\bय सद\bय सद\bय सद\bय / Judicial Member (जगदीश) (Jagadish) लेखा लेखा लेखा लेखा सद\u0011य सद\u0011य सद\u0011य सद\u0011य /Accountant Member चे\u0013नई/Chennai, \u0016दनांक/Dated: 12th March, 2025. EDN/- आदेश क\u0019 \bितिल\u001cप अ\u001dे\u001cषत/Copy to: 1. अपीलाथ\u0007/Appellant 2. \b\tथ\u0007/Respondent 3. आयकर आयु\u000f/CIT, Coimbatore 4. िवभागीय \bितिनिध/DR 5. गाड\u0018 फाईल/GF "