Chandmall Sarawgi Charitable Trust, A- Block, Mahabir Market, H.B.Road, Fancy Bazar, Guwahati - 781001, Guwahati V. Income Tax Officer, Ward 2(3)/ Exemptions Aayakar Bhawan, G.S.Road, Christain Basti, Guwahati - 781005, Guwahati

ITA 03/GTY/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 1172 (ITAT-GUWAHATI)
• Duration Of Justice: 1 year(s) 11 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 05-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMITAVA SEN J
• Keywords: Charitable institution
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL GAUHATI BENCH E COURT AT KOLKATA BEFORE SHRI S.S.GODARA, JUDICIAL MEMBER AND DR. A.L.SAINI, ACCOUNTANT MEMBER ITA NO. 03 / GAU / 2018 ASSESSMENT YEAR :2011-12 CHANDMALL SARAWGI CHARITABLE TRUST, A-BLOCK, MAHABIR MARKET, H.B. ROAD, FANCY BAZAAR, GUWAHATI- 781001 [ PAN NO.AAATC 2439 H ] V/S . ACIT (TRUST CIRCLE) NOW AS INCOME TAX OFFICER, WARD- 2(3)(EXEMPTION) /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI SANJAY MODI, FCA /BY RESPONDENT SHRI AMITAVA SEN, JCIT-DR /DATE OF HEARING 11-12-2019 /DATE OF PRONOUNCEMENT 18-12-2019 / O R D E R PER BEMCH:- THIS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2011-12 ARISES AGAINST THE COMMISSIONER OF INCOME TAX (APPEALS)-2, GUWAHATIS ORDER DATED 27.10.2017 PASSED IN CASE NO. GUWA-87/2014-15/15 INVOLVING PRO CEEDINGS U/S 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. HEARD BOTH THE PARTIES. CASE FILE PERUSED. 2. THE SOLE SUBSTANTIVE ISSUE(S) THAT ARISES FOR OU R APT ADJUDICATION IN THE INSTANT LIS IS THAT OF CORRECTNESS OF THE LOWER AUTHORITIES AC TION INVOKING SEC. 13(1)(C)(II) R.W.S. 13(2)(B) DISALLOWANCE OF 4,47,980/- ON THE GROUND THAT THE ASSESSEES TRUSTEE, SHRI GANPAT RAI SARAWGI WAS FOU ND TO HAVE BEEN RESIDING IN THE TRUSTS RESIDENTIAL PROPERTY WITHOUT PAYING ANY RENT. THE REVENUES CASE AS PER BOTH THE LOWER AUTHORITIES ACTION IS THAT S HRI SARAWGI HAS NOT PAID ANY RENT MUCH LESS THAN ADEQUATE RENT U/S. 13(1)(C)(B) OF THE ACT, AND THEREFORE, ITA NO.03/GAU/2018 ASSESSME NT YEAR: 2011-12 CHANDMALL SARAWGI CHARITABLE TRUST VS. ITO WD- 2(3) (EX) PAGE 2 THE IMPUGNED DISALLOWANCE HAS BEEN RIGHTLY MADE IN ASSESSEES CASE. WE FIND NO MERIT IN REVENUES FOREGOING ARGUMENTS. WE NOTICE THAT THE ASSESSEES RESIDENTIAL PROPERTY IN QUESTION HAD BEE N LET OUT TO A FIRM M/S BIMAL AUTO AGENCY FOR THE PAST VERY MANY ASSESSMENT YEARS ON PAYMENT OF RENT. MR. SARAWGI HAPPENS TO BE PARTNER OF SAID FIR M. THAT BEING THE CASE, WE SEE NO REASON TO SUSTAIN THE IMPUGNED DISALLOWANCE SINCE IT DOES NOT TURN AS A CASE OF HIS PAYMENT OF RENT SINCE THE ABOVE FIRM HAS BEEN REGULARLY PAYING THE RENT. WE ACCORDINGLY ACCEPT THE ASSESSEES FORM ER SUBSTANTIVE GROUND. 3. COMING TO LATTER SUBSTANTIVE GROUND REGARDING AM OUNT OF 5 LAC DISALLOWED U/S. 11(2) OF THE ACT IT EMERGES THAT TH E SAME IS MERE CONSEQUENTIAL IN NATURE FOR THE REASON THAT THE LOW ER AUTHORITIES HAD GONE BY THEIR FINDINGS ON THE FOREGOING ISSUE AND MADE THE IMPUGNED DISALLOWANCE IN EXPENDITURE TO COVER UP SHORTFALL IN APPLICATION OF INCOME. WE HOLD THAT THIS LATTER SUBSTANTIVE GROUND MUST ALSO FOLLOW SUIT TO THE FORMER ONE. WE ORDER ACCORDINGLY. 4. THIS ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 18/ 12/2019 SD/- SD/- (A.L.SAINI) (S.S.GODARA) (ACCOUNTANT MEMBER) JUDICIAL MEMBER) KOLKATA, *DKP - 18 / 12 /201 9 / / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-CHANDMALL SARAWGI CHARITABLE TRUST, A-BLOCK , MAHABIR MARKET, H.B. ROAD, FANCY BAZAR, GUWAHATI-781001 2. /RESPONDENT-ITO WARD-2(3), EXEMPTIONS AAYAKAR BHAWAN, G.S.ROAD, CHRISTIAN BASTI, GUWAHATI-005 3. * - / CONCERNED CIT GUAHATI 4. -- / CIT (A) GUAHATI 5. 0 33*, *, / DR, ITAT, GUAHATI 6. 7 / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO *,