IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER I.T.A. NO. 1209/HYD/2014 ASSESSMENT YEAR: 2008-09 DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, TIRUPATI VS M/S. VAISHNAVI EDUCATIONAL SOCIETY, THANAPALLI VILLAGE, KUNTRAPAKKAM POST, TIRUPATI RURAL [PAN: AAATV9994Q] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI RAJAT MITRA, DR FOR ASSESSEE : S HRI K.A.SAI PRASAD , AR DATE OF HEARIN G : 26 - 0 3 - 201 5 DATE OF PRONOUNCEMENT : 31 - 03 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS REVENUE'S APPEAL WAS FILED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-GUNTUR, DATED 2 4-02-2014 FOR THE ASSESSMENT YEAR (AY) 2008-09 FOR DELETING AN AMOUNT OF RS.14,92,500/- BROUGHT TO TAX BY ASSESSING OFFICER (AO) U/S.115BC OF THE INCOME TAX ACT [ACT]. I.T.A. NO. 1209/HYD/14 M/S. VAISHNAVI EDUCATIONAL SOCIETY :- 2 -: 2. BRIEFLY STATED, THERE WAS A SEARCH AND SEIZURE O PERATION AT THE RESIDENCE OF DR.K.RAMACHANDRA ON 12-02-2009 AND DUR ING SUCH PROCEEDINGS, CERTAIN DOCUMENTS BELONGING TO ASSESSE E'S SOCIETY WERE SEIZED. NOTICE U/S.153C WAS ISSUED TO THE APPELLAN T-SOCIETY. IN THE CONSEQUENTIAL PROCEEDINGS FOR AY.2008-09, AO BROUGH T TO TAX AN AMOUNT OF RS.36,22,500/- AS CORPUS DONATIONS U/S.115BBC ON THE REASON THAT THE SOCIETY HAS NOT BEEN ABLE TO ESTABLISH THE IDEN TITY AND THE CAPACITY OF THE DONORS AND ASSESSEE NOT DISCHARGE, THE BURDEN O F PROOF VESTED UPON IT WITHIN THE PROVISIONS OF SECTION 115BBC. ASSESS EE EXPLAINED THAT IT HAS RECEIVED CONTRIBUTIONS FROM 85 PERSONS TOTALING TO RS.21,30,000/-. IT WAS CLAIMED THAT THEY HAVE FILED NAMES AND ADDRE SSES OF THE DONORS HENCE, CORPUS DONATIONS SHOULD NOT BE ADDED U/S.115 BBC. DURING THE APPELLATE PROCEEDINGS, ASSESSEE SUBMITTED THAT OUT OF THE AMOUNT OF RS.36,22,500/-, THERE ARE DONATIONS FROM 85 PERSONS TO AN EXTENT OF RS.21,30,000/- AND CORPUS/BUILDING FUND OF RS.14,82 ,500/- PAID BY 228 STUDENTS WHO WERE ADMITTED THROUGH COUNSELOR OF MCE T AND NOT UNDER THE MANAGEMENT QUOTA. IT WAS SUBMITTED THAT THE ST UDENTS PAID AMOUNT AS PART OF FEES WHICH WAS APPROVED AND COMPLETE DET AILS WERE FURNISHED TO THE AO. CONSIDERING ASSESSEE'S SUBMISSIONS, LD. CIT(A) IN HIS ORDER DELETED THE AMOUNT OF RS.14,82,500/- PAID BY 228 ST UDENTS AS BUILDING FUND AND ALSO RS.10,000/- PAID BY DR. B. MANOHARAMM A, W/O. DR. K.RAMACHANDRA BY CHEQUE. REVENUE IS AGGRIEVED ON T HE DELETION OF AMOUNT RECEIVED FROM THE STUDENTS. 3. AT THE OUTSET, LD.COUNSEL SUBMITTED THAT ASSESSE E WAS AGGRIEVED ON THE CONFIRMATION OF RS.21,30,000/- BY THE CIT(A) AND WHEN THE MATTER WAS CARRIED TO ITAT, ITAT VIDE ITA NO.1180/ HYD/2014 FOR THE AY.2008-09 DT.07-11-2014 HAS DELETED THAT AMOUNT. I T WAS SUBMITTED THAT ITAT CONSIDERED THE DECISION OF THE DELHI BENC H OF THE ITAT IN THE CASE OF HANSRAJ SAMARAK SOCIETY [113 ITD 530] AND D ELETED THE I.T.A. NO. 1209/HYD/14 M/S. VAISHNAVI EDUCATIONAL SOCIETY :- 3 -: DONATIONS. ACCORDINGLY, SINCE THESE DONATIONS ALSO , IN WHICH ASSESSEE HAS FURNISHED IDENTITY AND ADDRESSES OF THE DONORS AS PROVIDED U/S.115BBC(3), THERE IS NO MERIT IN REVENUE'S APPEA L. 4. LD.DR, HOWEVER, VEHEMENTLY SUPPORTED THE ORDER O F AO. 5. WE HAVE CONSIDERED THE ISSUE. AS FAR AS ADDITION OF DONATIONS RECEIVED, BE IT AS CORPUS DONATION OR AS BUILDING F UND FROM THE STUDENTS, THE PROVISIONS OF SECTION 115BC REQUIRES THAT NAMES AND ADDRESSES OF THE DONORS ARE TO BE RECORDED. PROVISIONS OF SECTI ON 68 DO NOT APPLY TO THE REQUIREMENTS U/S.115BBC. THIS ISSUE WAS ELABOR ATELY DISCUSSED IN THE CO-ORDINATE BENCH DECISION IN ITA NO.1179/HYD/2 014 FOR AY.2007- 08 IN ASSESSEE'S OWN CASE, WHEREIN VIDE PARA NO.12, 13 & 14 ISSUE WAS DECIDED AS UNDER: '12. WE HAVE HEARD BOTH PARTIES AND PERUSED THE MA TERIAL ON RECORD. WE FIND THAT THE NAMES OF THE DONORS ALON G WITH THEIR ADDRESSES WERE FURNISHED BEFORE THE INVESTIGATION WING OF THE DEPARTMENT AND WERE ALSO RECORDED IN THE BOOKS PRO DUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. HENCE SUCH DONATIONS CANNOT BE CLASSIFIED AS 'ANONYMOUS DONATIONS' AS P ER THE PROVISIONS OF SECTION 115BBC(3) OF THE ACT. SECTI ON 115BBC(3) IS AS UNDER: 115BBC. (1) ... (2) (3) FOR THE PURPOSES OF THIS SECTION, 'ANONYMOUS DO NATION' MEANS ANY VOLUNTARY CONTRIBUTION REFERRED TO IN SUB -CLAUSE (IIA) OF CLAUSE (24) OF SECTION 2, WHERE A PERSON R ECEIVING SUCH CONTRIBUTION DOES NOT MAINTAIN A RECORD OF THE IDEN TITY INDICATING THE NAME AND ADDRESS OF THE PERSON MAKIN G SUCH CONTRIBUTION AND SUCH OTHER PARTICULARS AS MAY BE P RESCRIBED.] 13. HENCE, WE ARE OF THE OPINION THAT THE ONLY REQ UIREMENT U/S. 115BBC(3) IS THAT THE NAMES AND ADDRESSES OF THE D ONORS ARE TO BE RECORDED. THE LEARNED CIT(A) HAS WRONGLY APPLIED T HE PROVISIONS OF SECTION 68 IN THE CASE OF THE ASSESSEE BY STATING THAT THE RECIPIENT SOCIETY SHOULD ALSO BE IN A POSITION TO IDENTITY T HE DONORS AND I.T.A. NO. 1209/HYD/14 M/S. VAISHNAVI EDUCATIONAL SOCIETY :- 4 -: ESTABLISH THE CAPACITY TO GIVE A DONATION OF THE A MOUNT MENTIONED AGAINST THEIR NAMES. IN THIS CONTEXT, RELIANCE IS PLACED ON THE DECISION OF THE DELHI BENCH OF THIS TRIBUNAL IN TH E CASE OF HANSRAJ SAMARAK SOCIETY (133 ITD 530) WHEREIN HT HAS BEEN HELD AS UNDER: ' ... 4.4 SUB-SECTION (1) OF THE AFORESAID PROVISIO N PROVIDES THAT WHERE THE INCOME OF AN INSTITUTION ETC., REFERRED T O IN SECTION 11 INCLUDES INCOME BY WAY OF ANONYMOUS DONATION THE INCOME-TAX PAYABLE BY IT SHALL BE AGGREGATE OF - (I ) 30% OF THE ANONYMOUS DONATION AND(II) THE INCOME-TAX PAYABLE O N THE TOTAL INCOME AS REDUCED BY ANONYMOUS DONATION. SUB SECTION (2) EXCLUDES WHOLLY RELIGIOUS INSTITUTIONS FROM THE PURVIEW OF THE AFORESAID PROVISION. IT FURTHER EXCLUDES WHOLLY RELIGIOUS AND CHARITABLE INSTITUTIONS FROM THE PURVIEW OF THE AFORESAID PROVISION IF THE ANONYMOUS DONATION IS MADE WITH TH E SPECIFIC DIRECTION THAT SUCH DONATION IS FOR PURPOSES OTHER THAN FOR ANY UNIVERSITY, EDUCATIONAL INSTITUTION, HOSPITAL OR ME DICAL INSTITUTION. IT IS CLEAR THAT THIS PROVISION EXCLUD ES RELIGIOUS INSTITUTION AND INSTITUTION WHOSE OBJECTS ARE WHOLL Y RELIGIOUS AND CHARITABLE. SUB-SECTION (3) DEFINES THE EXPRESS ION ''ANONYMOUS DONATION' IN AN EXHAUSTIVE MANNER TO BE A CASE WHERE THE INSTITUTION ETC., DOES NOT MAINTAIN RECOR D OF IDENTITY INDICATING THE NAME AND ADDRESS OF THE PERSON MAKIN G THE CONTRIBUTION. NO FURTHER PARTICULARS REMAINED TO BE MAINTAINED HAVE BEEN PRESCRIBED UNDER THIS SUB-SECTION.' 14. RESPECTFULLY FOLLOWING THE RATIO OF THE DECISI ON SUPRA, WE ARE OF THE OPINION THAT THE CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 12,50,000 AS ANONYMOUS DONATIONS ATTRACTING THE PR OVISIONS OF S. 115BBC. HENCE THE GROUND TAKEN BY THE ASSESSEE IS ALLOWED'. 6. CONSEQUENT TO THE ABOVE, FOR THIS IMPUGNED ASSES SMENT YEAR, ADDITION OF RS.21,30,000/- CONFIRMED BY LD.CIT(A) W AS ALSO DELETED VIDE PARA 26 IN THE SAME ORDER AS UNDER: '26. THE LEARNED COUNSEL FOR THE ASSESSEE BROUGHT TO OUR NOTICE THAT THE RECORD OF DONORS HAS BEEN ACKNOWLEDGED IN THE ASSESSMENT ORDER ITSELF BY THE ASSESSING OFFICER AND HENCE SU BMITTED THAT THE CIT(A) IS INCORRECT IN HIS STATEMENT THAT THE RECO RD OF DONORS WAS NOT AVAILABLE AT THE TIME OF SEARCH. AS IN THE A.Y. 2 007-08, SINCE THE ASSESSEE MAINTAINED AND PRODUCED BEFORE THE ASSESS ING OFFICER, THE RECORD OF IDENTITY INDICATING NAMES AND ADDRES SES OF THE DONORS, IN OUR OPINION SUCH DONATIONS CANNOT BE CLASSIFIED AS ANONYMOUS I.T.A. NO. 1209/HYD/14 M/S. VAISHNAVI EDUCATIONAL SOCIETY :- 5 -: DONATIONS AS PER THE PROVISIONS OF SECTION 115BBC( 3) OF THE ACT. THIS ISSUE IS SIMILAR TO THE ISSUE DECIDED IN THE A.Y. 2007-08 AND THE SAME CONCLUSION IS TO BE DRAWN IN THIS YEAR AL SO. HENCE GROUND NOS. 1 TO 5 RAISED BY THE ASSESSEE ARE ALLOWED'. 7. IN VIEW OF THIS, SINCE ASSESSEE HAS COMPLIED WIT H THE PROVISIONS OF SECTION 115BBC AND FURNISHED THE NAMES AND ADDRESSE S OF DONORS TO THE AO, THERE IS NO MERIT IN THE REVENUE'S GROUNDS. ACCORDINGLY, CIT(A)'S ORDER IS CONFIRMED. 8. IN THE RESULT, REVENUE'S APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 31 ST MARCH, 2015. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUN TANT MEMBER HYDERABAD, DATED 31 ST MARCH, 2015 TNMM COPY TO : 1. DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE , 3 RD FLOOR, AAYAKAR BHAVAN, K.T. ROAD, TIRUPATI. 2. M/S. VAISHNAVI EDUCATIONAL SOCIETY, THANAPALLI V ILLAGE, KUNTRAPAKKAM POST, TIRUPATI RURAL. 3. CIT(APPEALS)-GUNTUR 4. CIT(CENTRAL)- HYDERABAD 5. D.R. ITAT, HYDERABAD