Rotary Club of Banjara Hills Charitable Trust, Hyderabad V. Income Tax Officer, Exemptions- Ward-1(3), Hyderabad

ITA 1143/Hyd/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7216 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 07-11-2019
• Assessment Year: 2016-2017
• Appeal Filed On: 15-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution; Set aside
• Section: 11; 143(3); 12A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A - SMC , HYDERABAD BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 1143/HYD/2019 ASSESSMENT YEAR: 2016 - 17 ROTARY CLUB OF BANJARA HILLS CHARITABLE TRUST, HYDERABAD. PAN: AABTR 8332 B VS. INCOME TAX OFFICER, EXEMPTION WARD - 1(3), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY: SRI S. RAMA RAO REVENUE BY: SRI SUNKU SRINIVAS, DR DATE OF HEARING: 07/11/2019 DATE OF PRONOUNCEMENT: 27 /01/2020 ORDER THIS APPEAL IS FILED AGAINST THE ORDER OF THE LD. CIT(A) - 9, HYDERABAD IN APPEAL NO. 10276/CIT(A) - 9, HYD/2018 - 19, DATED 06/05/2019 PASSED U/S. 143(3) R.W.S 250(6) OF THE ACT FOR THE A.Y. 2016 - 17. 2. T HE ASSESSEE HAS RAISED FIVE GROUNDS IN ITS APPEAL HOWEVER, THE CRUX OF THE ISSUES IS THAT THE LD. CIT (A) HAS ERRED IN CONFIRMING THE ORDER OF THE LD. AO WHO HAD BROUGHT THE AMOUNT OF RS 46,27,544 TO TAX SINCE THE PURPOSE FOR WHICH THE ACCUMULATED FUND IS SET APART IS NOT STATED IN FORM - 10. 2 3. THE BRIEF FACTS OF THE C ASE ARE THAT THE ASSESSEE IS CHARITABLE TRUST REGISTERED U/S. 12A OF THE ACT FILED ITS RETURN OF INCOME ON 30/09/2016 CLAIMING EXEMPTION U/S. 11 OF THE ACT DECLARING NIL INCOME. DURING THE COURSE OF SCRUTINY ASSESSMENT IT WAS OBSERVED BY THE LD. AO THAT THE ASSESSEE HAD ACCUMULATED AND SET ASIDE RS. 46,27,544 DURI N G THE RELEVANT ASSESSMENT YEAR AGAINST WHICH F ORM 10 WAS FILED. HOWEVER, IT WAS NOTICED BY THE LD. AO THAT IN THE F ORM 10 FILED BY THE ASSESSEE, ASSESSEE HAD NOT MENTIONED THE PURPOSE FOR WHICH THE AMOUNT WAS ACCUMULATED. THEREFORE, THE LD. AO BROUGHT THE AMOUNT OF RS. 46,27,544 TO TAX. ON APPEAL, THE LD. CIT (A) CONFIRMED THE ORDER OF THE LD. AO BY AGREEING WITH HIS VIEW. 4. BEFORE US, THE LD. AR SUBMITTED THAT IN THE FORM - 10 UNDER RULE 17(2) FILED BY THE ASSESSEE DATED 30/09/2016, BY MISTAKE, THE ASSESSEE HAD STATED TRUST IN THE COLUMN WHEREIN THE PURPOSE FOR WHICH THE AMOUNT IS ACCUMULATED OR SET APART IS TO BE MENTIONED. THE LD. AR FURTHER ARGUED STATING THAT IT WAS ONLY A TECHNICAL MISTAKE BY OVERSIGHT. HOWEVER, THE TRUST HAD PASSED A BOARD RESOLUTION ON 21/09/2016 WHEREIN IT WAS STATED THAT THE AMOUNT OF RS. 46,27,544 IS SET APART WHICH IS TO BE UTILISED IN THE NEXT FIVE YEARS TO PROVIDE PALLIATIVE CARE TO TERMINALLY ILL CANCER P ATIENTS. IT WAS THEREFORE PLEADED THAT THE TAX LEVIED BY THE LD. REVENUE AUTHORITIES ON THE AMOUNT OF RS. 46,27,544 MAY BE DELETED. THE LD. DR ON THE OTHER HAND RELIED ON THE ORDERS OF 3 THE LD. REVENUE AUTHORITIES AND ALSO ON FEW DECISIONS OF THE HIGHER JUDICIARY. 5. I HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE MATERIALS ON RECORD. ON VERIFYING THE FORM 10 FILED BY THE ASSESSEE UNDER RULE 17(2) OF THE RULES, I AM OF THE VIEW THAT THE MENTIONING OF THE WO RD TRUST IN THE COLUMN MENTIONED PURPOSE FOR WHICH AMOUNT IS BEING ACCUMULATED OR SET APART IS ONLY A MISTAKE BY OVERSIGHT WHICH IS RECTIFIABLE. THE INTENTION OF THE ASSESSEE IS CLEAR FROM THE RESOLUTION PASSED BY THE GOVERNING BODY OF THE MEMBERS OF THE TRUST DATED 21/09/2016 THAT THE AMOUNT OF RS. 46,27,544 IS SET ASIDE WHICH IS TO BE UTILISED FOR THE SUCCEEDING FIVE YEARS IN ORDER TO PROVIDE PALLIATIVE CARE TO TERMINALLY ILL CANCER PATIENTS. THEREFORE, IN THE INTEREST OF JUSTICE, I HEREBY REMIT THE MATTER BACK TO THE FILE OF THE LD . AO WITH DIRECTION TO PROVIDE PROPER OPPORTUNITY TO THE ASSESSEE TO RECTIFY THE MISTAKE COMMITTED IN THE FORM - 10 SUBMITTED BY THE ASSESSEE UNDER RULE 17(2) OF THE RULES. I FURTHER MAKE IT CLEAR THAT ON SUCH RECTIFICATION STATING THE PURPOSE FOR WHICH AMOUNT IS ACCUMULATED OR SET APART IS FO R THE PURPOSE OF UTILISING THE AMOUNT OF RS. 46,27,544 FO R THE SUCCEEDING FIVE YEARS IN ORDER TO PROVIDE PALLIATIVE CARE TO TERMINALLY ILL CANCER PATIENTS, THE LD. AO SHALL DELETE THE TAX LEVIED ON THE AMOUNT OF RS. 46,27,544. IT IS ORDERED ACCORDINGLY. IT IS ALSO PERTINENT TO MENTION THAT THE DECISIONS RELIED BY THE LD. DR IS NOT APPLICABLE TO THE FACTS IN THE CASE OF THE ASSESSEE. 4 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 27 TH JANUARY, 2020. SD/ - ( A. MOHAN ALANKAMONY ) ACCOUNTANT MEMBER HYDERABAD, DATED: 27 TH JANUARY, 2020 OKK COPY TO: - 1) ROTARY CLUB OF BANJARA HILLS CHARITABLE TRUST, PLOT NO.72, NAGARJUNA HILLS, PANJAGUTTA, HYDERABAD - 82. 2) INCOME TAX OFFICER EXEMPTION WARD - 1(3), AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD. 3) THE CIT (A) - 9, HYDERABAD. 4) COMMISSIONER OF INCOME TAX (EXEMPTION), HYDERABAD. 5) THE DR, ITAT, HYDERABAD 6) GUARD FILE