H.N. Mehta Corporation, Ahmedabad V. DCIT, Circle-1(2), Ahmedabad

ITA 1315/AHD/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 9146 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2014-2015
• Appeal Filed On: 21-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Assessee Lawyers: MUKESH KHANDWALA
• Section: 13

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD - BENCH C BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ ITA NO.1315/AHD/2018 / ASSTT. YEAR: 2014-15 H.N.METAL CORPORATION 100-D, GRAIN MARKET NR. GAYATRI MILK DAIRY ANUPAM CINEMA KHOKHRA, AHMEDABAD 380 008. PAN : AABFH 2806 C VS. DCIT, CIR.1(2) AHMEDABAD. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI MUKESH KHANDWALA, CA REVENUE BY : SHRI L.P.JAIN, SR.DR ! / DATE OF HEARING : 10/01/2020 '#$ ! / DATE OF PRONOUNCEMENT: 13 /01/2020 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST O RDER OF LD.CIT(A)-10, AHMEDABAD DATED 22.3.2018 PASSED FOR THE ASSTT.YEAR 2014-15. 2. ONLY EFFECTIVE GROUND RAISED IN THIS APPEAL OF T HE ASSESSEE IS THAT THE LD.CIT(A) HAS ERRED IN CONFIRMING ADDITION OF R S.5,25,000/- ON ACCOUNT OF DONATION MADE BY THE ASSESSEE TO HERBICU RE HEALTHCARE BIO- HERBAL RESEARCH FOUNDATION. ITA NO.1315/AHD/2018 2 3. FACTS IN BRIEF ARE THAT THE ASSESSEE HAS E-FILED RETURN OF INCOME ON 18.9.2014 DECLARING TOTAL INCOME AT RS.49,20,280/-. AS PER THE INFORMATION RECEIVED FROM DDIT(INVT), AHMEDABAD, AS SESSEE WAS ONE OF THE BENEFICIARIES INDULGED IN GIVING BOGUS DONATION TO ONE HERBICURE HEALTH CARE BIO HERBAL RESEARCH FOUNDATION, KOLKATT A IN THE F.Y.2013- 14 RELEVANT TO THE ASSTT.YEAR 2014-15. DURING THE YEAR UNDER CONSIDERATION ASSESSEE HAS MADE DONATION OF RS.3 LA KHS TO THE SAID FOUNDATION, AND CLAIMED DEDUCTION OF RS.5,25,000/- I.E. 175% OF THE DONATED AMOUNT, UNDER 35(1)(II) OF THE INCOME TAX A CT. ON SCRUTINY OF THE ACCOUNTS, IT REVEALED THAT THE ASSESSEE-COMPANY HAS GIVEN DONATION TO HERBICURE HEALTHCARE BIO-HERBAL RESEARCH FOUNDAT ION, CALCUTTA. A SURVEY ACTION WAS CARRIED OUT AT THE PREMISES OF TH E DONEE WHEREIN IT REVEALED TO THE REVENUE THAT THIS CONCERN WAS MISUS ING THE BENEFIT OF NOTIFICATION ISSUED BY THE INCOME TAX DEPARTMENT. IT HAS BEEN GETTING DONATIONS FROM VARIOUS SOURCES, AND AFTER DEDUCTING CERTAIN AMOUNT OF COMMISSION, THESE DONATIONS WERE REFUNDED IN CASH. ON THE BASIS OF THAT SURVEY REPORT REGISTRATION GRANTED TO ITS FAVO UR WAS CANCELLED. ON THE BASIS OF THE OUTCOME OF THAT SURVEY REPORT, THE LD.AO CONSTRUED THE DONATION GIVEN BY THE ASSESSEE AS BOGUS. APPEAL TO THE LD.CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE. 4. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE CONTE NDED THAT DONATIONS WERE GIVEN ON 25.2.2014. AT THAT POINT O F TIME, DONEE WAS NOTIFIED AS ELIGIBLE INSTITUTION AND FALL WITHIN TH E STATUTORY ELIGIBILITY CRITERION. CERTIFICATE FOR RECEIVING DONATION WAS CANCELLED ON 5.9.2016. THERE IS NO MECHANISM WITH THE ASSESSEE TO VERIFY W HETHER SUCH DONEE WAS A GENUINE INSTITUTE OR NOT, WHICH CAN AVAIL DON ATION FROM THE SOCIETY. 5. THE LD.DR, ON THE OTHER HAND, CONTENDED THAT IN THE INVESTIGATION IT CAME TO KNOW ABOUT BOGUS AFFAIRS CONDUCTED BY TH E DONEE. HENCE, ITA NO.1315/AHD/2018 3 THESE DONATIONS ARE RIGHTLY BEEN TREATED AS BOGUS, AND ADDITION IS RIGHTLY MADE. 6. WE HAVE DULY CONSIDERED RIVAL CONTENTIONS AND GO NE THROUGH THE RECORD CAREFULLY. THE AO IS HARPING UPON AN INFORM ATION SUPPLIED BY THE SURVEY TEAM OF KOLKATTA. HE HAS NOT SPECIFICALLY R ECORDED STATEMENT OF REPRESENTATIVES OF THE DONEE. HE HAS NOT BROUGHT O N RECORD ANY SPECIFIC EVIDENCE WHEREIN DONEE HAS DEPOSED THAT DO NATIONS RECEIVED FROM THE ASSESSEE WAS PAID BACK IN CASH AFTER DEDUC TING COMMISSION. ON THE BASIS OF GENERAL INFORMATION COLLECTED FROM THE DONEE, THE DONATION MADE BY THE ASSESSEE CANNOT BE DOUBTED. N EITHER REPRESENTATIVES OF THE DONEE HAVE BEEN PUT TO CROSS -EXAMINATION, NOR ANY SPECIFIC REPLY DEPOSING THAT SUCH DONATION WAS NOT RECEIVED, OR IF RECEIVED THE SAME WAS REPAID IN CASH, HAS BEEN BROU GHT ON RECORD. IN THE ABSENCE OF SUCH CIRCUMSTANCES, DONATION GIVEN B Y THE ASSESSEE TO THE DONEE, ON WHICH THE ASSESSEE NO MECHANISM TO CH ECK THE VERACITY, CAN BE DOUBTED, MORE PARTICULARLY, WHEN CERTIFICATE TO OBTAIN DONATION HAS BEEN CANCELLED AFTER TWO YEARS OF THE PAYMENT O F DONATION. IT IS FACT WHICH HAS BEEN UNEARTHED SUBSEQUENT TO THE DONATION S. THEREFORE, THERE CANNOT BE ANY DISALLOWANCE ON THIS ISSUE. WE ALLOW THIS GROUND. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 13 TH JANUARY, 2020 AT AHMEDABAD. SD/- SD/- (WASEEM AHMED) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 13/01/2020