ACIT (E), New Delhi V. M/s Jindal Charitable Society, New Delhi

ITA 1253/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3354 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2011-2012
• Appeal Filed On: 07-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SH ATI Q AHMAD
• Assessee Lawyers: CHANDER SHEKHAR
• Keywords: Charitable institution
• Section: 133(6); 80G; 12A; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SH. BHAVNESH SAINI, JUDICIAL MEMBER AND SH. L.P.SAHU, ACCOUNTANT MEMBER ITA NO. 1253/DEL/2016 (ASSESSMENT YEAR: 2011-12) ACIT CIRCLE-1(1) NEW DELHI VS JINDAL CHARITABLE SOCIETY PS-1, C-3, BLOCK, ASHOK VIHAR, PHASE-II NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AATJ0588L C.O. NO. 221/D EL/2017 (IN ITA NO. 1253/DEL/2016) JINDAL CHARITABLE SOCIETY PS-1, C-3, BLOCK, ASHOK VIHAR, PHASE-II NEW DELHI VS ACIT CIRCLE-1(1) NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. AATJ0588L ASSESSEE BY : SH. CHANDER SHEKHAR, CA REVENUE BY : SH. SH. ATI Q AHMAD, SR. DR DATE OF HEARING : 29.01.2018 DATE OF PRONOUNCEMENT :15.02.2018 ORDER L.P. SAHU, ACCOUNTANT MEMBER 1. THE APPEALS BY THE DEPARTMENT AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS D ATED 30.12.2015 THE CIT(A)- 40, NEW DELHI FOR THE ASSESSMENT YEAR 2 011-12. ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 2 2. SINCE THE APPEALS AND THE CROSS OBJECTIONS P ERTAINING TO THE SAME ASSESSEE WERE HEARD TOGETHER SO THESE ARE BEIN G DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENC E AND BREVITY. THE GROUNDS OF APPEAL AS UNDER :- ITA NO. 1253/DEL/2016 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING THE APPEAL OF THE ASSE SSEE REGARDING SET-OFF OF LOSS OR DEFICIT BY IGNORING THE FACT THAT THERE IS NO PROVISION U/S 11,12,12AA & 13 OF THE INCOME TAX ACT, 1961 FOR ALL OWING CARRY FORWARD OR ADJUSTMENT OF DEFICIT OR LOSS ETC. THE GROUNDS OF APPEAL AS UNDER :- C.O. NO. 221/DEL/2017 1. THAT ON THE FACTS AND THE CIRCUMSTANCE OF THE C ASE AND IN LAW, THE LD. CIT(A)-40, AND LD. ASSESSING OFFICER HAD WRONGLY AD DED AMOUNT OF RS. 39,00,000/- WITHOUT CONSIDERING THE NATURE OF RECEI PT WHICH IN ANYWAY FALL UNDER SECTION 11 OF THE INCOME TAX ACT, 1961 A ND THEREBY APPLICATION SHALL BE ALLOWED AS PER SCHEME OF SECTI ON 11(1)(A). HENCE THE ADDITION IS UNJUSTIFIED AND LIABLE TO BE DELETE D. 1. THAT THE LEARNED CIT(A-40 AND LD. ASSESSING OFFICER HAD WRONGLY DISALLOWED THE CORPUS DONATION OF RS. 39,00,000/- O R OTHERWISE, IGNORING THE JUDICIAL CONSENSUS ON THE IMPORTANCE OF APPLICA TION OF INCOME FOR CHARITABLE PURPOSE IRRESPECTIVE OF TH SOURCE OF INC OME. THEREFORE, ADDITION MADE IS BAD IN LAW. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F ILED RETURN OF INCOME ON 4 TH JANUARY, 2012 DECLARING INCOME NIL. THE CASE WAS TAKEN UP FOR SCRUTINY AND STATUTORY NOTICES WERE IS SUING TO THE ASSESSEE. THE ASSESSEE IS ENGAGED IN RUNNING SCHOOL IN THE NAME OF PRESIDIUM SR. SECONDARY SCHOOL, ASHOK VIHAR-II, NEW DELHI. THE MAIN AIMS AND OBJECTS OF THE SOCIETY ARE TO PROVIDE AND PROMOTE ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 3 EDUCATION BY ESTABLISHING NURSERY, PRIMARY AND HIG HER SECONDARY SCHOOL. THE ASSESSEE SOCIETY IS REGISTERED U/S 12A (A) OF THE I.T.ACT, 1961 VIDE DIT(E)/ 97-98/J-423/97/155 DATED 28.08.19 97. THE ASSESSEE SOCIETY HAS ALSO BEEN GRANTED EXEMPTION U/ S 80G OF THE ACT VIDE NO. DIT(E)/2008-09/J-423/538 DATED 04.06.2008 FOR THE PERIOD 01.04.2008 TO 31.03.2011. THE TRUSTS OBJECTS ARE C HARITABLE WITHIN THE MEANING OF SECTION 2(15) OF THE I.T.ACT, 1961. THE BENEFIT OF SECTION 11 & 12 IS ALLOWED TO THE ASSESSEE. 3. DURING THE COURSE OF SCRUTINY PROCEEDINGS, THE LD. ASSESSING OFFICER OBSERVED THAT ASSESSEE HAS RECEIVED SOME DO NATIONS. NOTICES U/S 133(6) OF THE INCOME TAX WERE ISSUED TO 21 PERS ONS/DONORS ON THE LATEST ADDRESSES TO VERIFY THE GENUINENESS OF THE S AME. IN RESPONSE TO THIS 9 PERSONS/DONORS CONFIRMED AND RESTS DONORS/PE RSONS DID NOT COMPLY. A SHOW-CAUSE NOTICE WAS ISSUED BY THE ASSES SING OFFICER WHICH IS AS UNDER :- (I) THE DONATION OF RS. 25,00,000/- RECEIVED FROM SICPA INDIA PVT. LTD. IS IN THE NATURE OF GENERAL DONATION. WHY THE SAME SHOULD NOT BE INCLUDED IN YOUR TOTAL RECEIPTS? (II) THE GENUINENESS OF THE TRANSACTION MADE AND CREDITWORTHINESS OF THE PARTIES NAMELY VISIT INDIA VOYAGES PVT. LTD, MAYFAIR INFOSOLUTIONS PVT. LTD. SHRI BHAW ANI INDIA PVT. LTD. AND ALLURE CREATION DOES NTO ESTABLISH. H ENCE, THE DONATION AMOUNTING TO RS. 30,00,000/- RECEIVED FROM THESE 4 PARTIES SHOULD NOT BE TAXED AS YOUR INCOME IN VIEW OF THE PROVISIONS OF THE INCOME TAX ACT, 1961. (III) NOTICES U/S 133(6) HAS BEEN ISSUED ON RANDOM BASIS TO 21 PARTIES/PERSONS. OUT OF THAT 12 PARTIES/PERSONS DID NOT ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 4 COMPLY THE NOTICES NOT EVEN ON THE OLD ADDRESSES BU T ALSO ON LATEST ADDRESSES PROVIDED BY YOU. YOU HAVE FAILED T O PROVE THE GENUINENESS OF THE TRANSACTION WITH THE DONORS SO MADE. HENCE, THE DONATION AMOUNTING TO RS. 1,80,00,000/- RECEIVED FROM THESE 12 PARTIES SHOULD NOT BE TAXED AS YOUR I NCOME IN VIEW OF THE PROVISIONS OF THE INCOME-TAX ACT, 1961. 4. THE ASSESSEE MADE SUBMISSIONS BEFORE THE ASSESSING OFFICER ALSO. THE LD. AO AFTER EXAMINING THE DOCUMENTS / SU BMISSIONS, THE OBSERVATIONS OF THE ASSESSING OFFICER AS UNDER :- 5. HOWEVER, THE ASSESSEE VIDE HIS LETTER DATED 25. 03.2014 HAS SUBMITTED THAT IT IS UNABLE TO PROVIDE FRESH CONFIR MATIONS IN RESPECT OF THE FOUR DONORS NAMELY MAYFAIR INFOSOLUT IONS PVT. LTD. RS. 10 LACS, SHRI BHAWANI INDIA PVT. LTD. RS. 10 LA CS, BANKEY BIHARI TRADING CO. RS. 9 LACS AND BALAJI ENTERPRISE S RS. 10 LACS AND TO AVOID ANY KIND OF LITIGATION AND TO BUY PEAC E OF MIND THE ASSESSEE IS READY TO OFFER THE AMOUNT OF RS. 39,00, 000/- IN RESPECT OF THESE PARTIES FOR TAXATION. 6. THE ASSESSEE FAILED TO SUBSTANTIATE ITS CLAIM I N AS MUCH AS THE ALLEGED DONATION OF RS. 39,00,000/- IN RESPECT OF T HE AFORESAID PERSONS/DONORS. THEREFORE, RS. 39,00,000/- IS DISAL LOWED AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE AS ITS UN DISCLOSED INCOME FROM OTHER SOURCES. I AM SATISFIED THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS IN RESPECT OF ITS INCOME, PENALTY PROCEEDINGS U/S 271(1)(C) IS BEING INITIATED SEPARA TELY. 5. AGGRIEVED BY THE ABOVE ADDITION OF RS. 39,00,0 00/-. THE ASSESSEE IN APPEAL BEFORE THE CIT(A) AND THE LD. CIT(A) AFTE R CONSIDERING THE ORDER OF THE ASSESSING OFFICER AND SUBMISSIONS OF T HE ASSESSEE. HE PARTLY ALLOWED OF THE APPEAL OF THE ASSESSEE. ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 5 6. AGGRIEVED BY THE ORDER OF THE CIT(A). THE REVE NUE IN APPEAL BEFORE THE ITAT ON THE ABOVE NOTED GROUNDS AND THE ASSESSEE ALSO FILED CROSS OBJECTION AGAINST THE ORDER OF THE CIT( A). 7. AT THE OUTSET OF HEARING, WE OBSERVE THE ORDE R OF THE ASSESSING OFFICER, CIT(A) AND GROUNDS OF APPEAL TAKEN BY THE REVENUE. GROUNDS OF APPEAL ARE NOT EMANATING FROM THE ORDER OF THE A O AS WELL AS CIT(A). THE GROUNDS ARE ON DIFFERENT FOOTING WHICH HAD NOT BEEN DECIDED BY THE ANY LOWER AUTHORITIES. THEREFORE, TH E APPEAL OF THE REVENUE IS DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE ALSO DISMISSED AS WITHDRAWN. 8. IN THE RESULT APPEALS OF THE DEPARTMENT AND TH E CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. (ORDER PRONOUNCED IN THE COURT ON 15/02/2018). SD/- SD/- (BHAVNESH SAINI) (L.P.SAHU) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 15.02.2018 BINITA COPY OF ORDER TO: - 1) THE APPELLANT; 2) THE RESPONDENT; 3) THE CIT; 4) THE CIT(A)-, NEW DELHI; 5) THE DR, I.T.A.T., NEW DELHI; TRUE COPY BY ORDER ITAT, NEW DELHI ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 6 S.NO. DETAILS DATE 1 DRAFT DICTATED ON 09.02.2018 2 DRAFT PLACED BEFORE AUTHOR 09.02.2018 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5 APPROVED DRAFT COMES TO THE SR. PS/PS 6 KEPT FOR PRONOUNCEMENT ON 7 FILE SENT TO BENCH CLERK 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE ON WHICH FILE GOES TO THE A.R. 10 DATE OF DISPATCH OF ORDER ITA NO.1253/DEL/2016 (C.O. NO. 221/ DEL/ 2017) 7