DCIT EXMP.CIRCLE, Bhopal V. BIRLA JAN SEWA TRUST, Gwalior

ITA 147/AGR/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 9328 (ITAT-AGRA)
• Duration Of Justice: 2 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2012-2013
• Appeal Filed On: 08-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL BAJPAI
• Assessee Lawyers: SHRI
• Keywords: Charitable institution; Principle of natural justice; Benefit of exemption
• Section: 143(3); 12AA; 201; 11

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI LALIET KUMAR, JUDICIAL MEMBER AND DR. MITHA LAL MEENA, ACCOUNTANT MEMBER ITA NO. 147/AGRA/2017 ASSESSMENT YEAR: 2012-13 DCIT (EXEMPTION), CIRCLE, BHOPAL (APPELLANT) VS. BIRLA NAGAR JAN SEWA TRUST, SURYA MANDIR ROAD, RESIDENCY, GWALIOR (M.P.) PAN AABTB5364M (RESPONDENT) A PPELLANT BY SHRI SUNIL BAJPAI, CIT DR RE SPONDENT BY SHRI PANKAJ GARGH, ADVOCATE ORDER PER LALIET KUMAR, J.M: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER DATED 22.02.2017 PASSED BY THE LD. CIT(A), GWALIOR FOR THE ASSESSMENT YEAR 2012-13. THE SOLE GROUND RAISED IN THIS APPEAL IS AS UNDER: 1. WHETHER THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE, THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS. 7,34, 12,020/- MADE BY THE ASSESSING OFFICER AND ALLOWING THE BENEFITS OF EXEM PTION U/S 11 OF THE L.T. ACT TO THE ASSESSEE, AS THE PAYMENTS IN EXCESS OF REASO NABLE LIMITS AS SUPPORTED BY COMPARATIVE INSTANCES QUOTED BY ASSESSING OFFICE R, WERE MADE AND DATE OF HEARING 08 .0 8 .2019 DATE OF PRONOUNCEMENT 20 .09 .2019 ITA NO.147 /AGR/2017 2 TREATED BY H BENEFITS TO THE PERSONS REFERRED TO IN SECTION 13(3) OF THE ACT AND ESPECIALLY WHEN THE TRUST WAS BEING RUN ON THE COMMERCIAL LINES BY SHARING OF RECEIPTS WITH PROHIBITED PERSONS ON LUMP SUM OR PERCENTAGE BASIS? 2. THE ASSESSEE IS A CHARITABLE TRUST REGISTERED SI NCE 21.11.1977 AND IS RUNNING MEDICAL INSTITUTION (HOSPITAL) AND ALSO IN THE IMPA RTING OF EDUCATION. THE ASSESSES TRUST BESIDES HAVE REGISTERED U/S 12AA OF THE ACT W AS ALSO APPROVED U/S 10(23C)(VIA) OF THE ACT. THE ASSESSEE TRUST IS RUNN ING THE HOSPITAL IN THE NAME OF BIMR HOSPITAL AND BIMR HEART CENTRE. THE ASSESSEE H AD FILED RETURN OF INCOME DECLARING THE NIL INCOME FOR THE AY 2012-13. HOWEVE R, THE ASSESSMENT WAS COMPLETED BY THE AO BY ASSESSING THE INCOME OF THE ASSESSEE TO THE TUNE OF RS.7,34,12,020/- BY NOT ALLOWING THE EXEMPTION U/S 10(23C) (VIIA) VIZ-A-VIZ SECTION 11 OF THE INCOME TAX ACT, 1961. 3. THE AO RECORDS IN THE ASSESSMENT ORDER THAT THE PAYMENTS WERE MADE TO THE PROHIBIT PERSON U/S 13(3) OF THE ACT AT UNREASONABL E RATE.AT PAGE 5 OF THE AO MENTIONED AS UNDER: S.NO. NAME QUALIFICATION DESIGNATION RELATION AMOUNT PAID 1. DR. RAV I SHANKA R DALMIA M.D. (MEDICINE) GOLD MEDAL 1ST D.M. CARDIOLOGY DIRECTOR BIMR HEART CENTRE SON OF SHRI B.D. DALMIA PRESIDENT/ EXECUTIVE TRUSTEE SALARY RS. 54,00,000/- ITA NO.147 /AGR/2017 3 02 DR. PRATHISTHADALMIA M.D. (OBS - GYNAE) VISITINGCONSULTANT DAUGHTER - IN - LAW OF SHRI B.D.DALMIA PRESIDENT /EXECUTIVETRUSTEE VISITING FEE RS. 10,45,507/- 3. DR. SUNILAGRAWAL ORTHOPEDICSURGEION VISITINGCONSULTANT SON OF SHRI S.K. AGRAWAL TRUSTEE VISITING FEE RS. 29,27,418/- 4. SMT. KUSUM AGARWAL N . A N . A WIFE OF SHRI S.K. AGRAWAL TRUSTEE C - ARM MACHINE 5. SUNIL DALMIA B.C OM SR. EXECUTIVE (COMMERCIAL) NEPHEW OF SHRI B.D. DALMIA PRESIDENT/EXECUTIVE DIRECTOR SALARY RS.4,56,000/- 4. IN PARAGRAPH 5, IT WAS MENTIONED BY THE AO THAT THESE PERSONS ARE RELATIVE OF THE TRUSTEES AND THEREFORE, THE PAYMENT MADE BY THE SE PERSONS IS PROHIBIT U/S 13(2C) OF THE ACT. THE AO HAD GIVEN THE SHOW CAUSE NOTICE TO THE ASSESSEE TRUST AND IN THE REPLY THE ASSESSEE TRUST HAS SUBMITTED A REP LY ON 12.03.2015 WHICH WAS REPRODUCED BY THE AO IN THE ASSESSMENT ORDER PAGE 5 1 TO 54 AS UNDER: ITA NO.147 /AGR/2017 4 ITA NO.147 /AGR/2017 5 ITA NO.147 /AGR/2017 6 ITA NO.147 /AGR/2017 7 ITA NO.147 /AGR/2017 8 5. THE AO HAS MENTIONED IN THE ASSESSMENT ORDER THA T THE SALARY PAID TO DR. RAVI SHANKAR DALMIA WAS TO THE TUNE OF RS.54.00 LAKH DUR ING THE FINANCIAL YEAR WAS EXCESSIVE AND WAS NOT IN THE TUNE WITH THE SALARY PAID TO OTHER PROFESSIONAL NAMELY D.M. (CARDIOLOGY) WORKING IN GWALIOR AND FOR THAT P URPOSES THE AO HAD MENTIONED THE SALARY GIVEN IN GAJRAJACHIKITSAMAHAVIDHYALAY, G WALIOR. DR. PUNIT RASTOGI AND DR. RAM KUMAR GUPTA AND THEY WERE ONLY PAID THE SALARY OF RS.15,43,568/-PA.SIMILARLY THE AO HAD ALSO BROUGHT ON RECORD THE COMPARABLE IN STANCES OF SALARY PAID TO CHIRAYU MEDICAL COLLEGE AND HOSPITAL WHERE THE SALA RY PAID TO DOCTORS VIKAS GOYAL WAS MENTIONED AS RS.7,20,000/- AND RS.5,76,240/- AN D RS.9,39,430/- PAID TO DR. R.K. SINGH AND DR. DEVASHISH CHAKRAWATIREPECTIVELY (AT P AGE 12 OF THE ASSESSMENT ORDER). THE AO HAS MENTIONED THAT THE AO HAS GATHER ED THE INFORMATION FROM THE MARKET AND COMPARE THESALARY / PROFESSIONAL CHARGES PAID TO DOCTORS. IT WAS MENTIONED THAT BESIDE MINIMUM SALARY OF RS.50,000/- PER ANNUM. THE DOCTORS ARE PAID PROFESSIONAL CHARGES, WHICH READ AS UNDER: 1. FOR ANGIOPLASTY 30% OF THE CHARGES CLAIMED FROM PATIENT. 2. ANGIOGRAPHY 20% OF THE CHARGES CLAIMED FROM PATI ENT. 3. COLOR DOPLER ABOUT RS.300/- PER PERSON. 4. TMT ABOUT RS.300/- PER PERSON. 6. IT WAS CONCLUDED BY THE AO THAT FOR THE PURPOSES OF PUTTING RS.54.00 LAKH SALARY AND PROFESSIONAL CHARGES TO THE DR. RAVI SHA KAR DALMIA HE SHOULD HAVE ITA NO.147 /AGR/2017 9 BROUGHT WORK OF ABOUT RS.2.00 CRORE TO THE HOSPITAL . THIS INFORMATION COLLECTED BY THE AO AND WAS PUT ACROSS TO THE ASSESSEE AND THE ASSESSEE HAD FILED THE REPLY TO AO AFTER RECEIVING THIS INFORMATION. HOWEVER, THE A O WAS NOT CONVINCED WITH THE REPLY GIVEN BY THE ASSESSEE AND HAD THEREFORE, DISA LLOWED THE BENEFIT ARISING TO THE ASSESSEE U/S 11 OF THE ACT. AS THE AO COME TO THE C ONCLUSION THAT THE SALARY/VISITING FEES PAID TO THE DOCTORS WERE EXCESSIVE AND UNREASO NABLE HAVING REGARD TO THE MARKET RATE AND THUS, THE AO HAS FORFEITED EXEMPTIO N U/S 11 OF THE ACT AND COMPUTED THE INCOME AT RS.7,34,12,020/-. 7. FEELING AGGRIEVED BY THE ORDER PASSED BY THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE CIT(A) HAS EXAMINED THE REAS ONING GIVEN BY THE AO AND RECORDED THE FINDING IN PARA 5.1.1 AND 5.2.1 AS UND ER: 5.1.1 DECISION: I HAVE CAREFULLY CONSIDERED THE SU BMISSIONS PUT FORWARD ALONGWITH THE JUDGMENTS OF THE CASES RELIED UPON & ARGUMENT ADVANCED ON BEHALF OF THE APPELLANT, PERUSED THE FACTS OF THE C ASE AND OTHER MATERIAL AVAILABLE ON RECORD AND THE ISSUE IS DECIDED AS UND ER;- (I) IT IS NOT IN DISPUTE THAT APPELLANT HAS MAD E PAYMENT TO THE PERSONS WHO REFERRED TO IN SECTION 13(3) OF THE ACT, THE AO HAS MADE THE DISALLOWANCE BECAUSE HE WAS OF THE OPINION THAT EXC ESSIVE PAYMENT HAS BEEN MADE BY THE APPELLANT TO THESE PERSONS. (II) PAYMENT TO DR. RAVISHANKARDALMIA- DR. DALMIA I S DM CARDIOLOGY AND HOD OF DMBIMR HEART CENTER. THE GROSS RECEIPTS O F THIS HEART CENTER IN THE FINANCIAL YEAR 2010-11 WAS RS.2,39,60,000/- AND THE APPELLANT HAS PAID AS SALARY RS. 36.15 LACS TO DR. RAVI SHANKAR D ALMIA. IN THE FINANCIAL YEAR 2011-12 THE GROSS RECEIPTS OF HEART CENTER HAS INCREASED TO RS. 3,37,14,000/- AND THE REMUNERATION PAID TO RAVISHAN KARDALMIA WAS INCREASED TO RS. 54 LACS. IN THE ASSESSMENT ORDER THE AO HAS GIVEN THE DETAIL OF REMUNERATION PAID BY THE DIFFERENT MEDICAL INSTITUTES OF GWALIOR TO THE DOCTORS WHO ARE ITA NO.147 /AGR/2017 10 DM CARDIOLOGIST. HOWEVER DURING THE ASSESSMENT PROC EEDING THE AO HAS NOT INFORMED ABOUT THIS INQUIRY TO THE APPELLANT. TH E AO HAS ALSO NOT MENTIONED IN THE ASSESSMENT ORDER THE AMOUNT OF FEE S COLLECTED BY THESE MEDICAL INSTITUTES BY AVAILING THE SERVICE OF DM CA RDIOLOGY AND HAS ALSO NOT STATED WHETHER THESE CARDIOLOGIST ARE DOING PRI VATE PRACTICE ALSO. DURING THE APPELLATE PROCEEDING THE ID AR HAS SUBMI TTED THE AGREEMENT OF DR. NAVEEN BAMRI OF MAX SUPER SPECIALTY HOSPITAL NE W DELHI AND SUBMITTED THAT THE REMUNERATION PAID BY THE APPELLA NT TO RAVI SHANKAR DALMIA IS REASONABLE. ON PAGE J_3_OF THE ASSESSMENT ORDER THE AO HAS OBSE RVED THAT THE HOSPITALS IN INDIA ARE GIVING MINIMUM OF SALARY OF RS.50,000/ - PER MONTH TO DM (CARDIOLOGY) AND IN ADDITION TO THIS MINIMUM SALARY THE HOSPITALS ARE ALSO PAYING CERTAIN PERCENTAGE/ AMOUNT OF FEES COLLECTED FROM THE PATIENT TO THEM. HOWEVER IT IS NOT THE CASE OF THE AO THAT IF THE REMUNERATION OF DR. RAVISHANKARDALMIA IS CALCULATED AT AS PER THE RATES GIVEN 'BY THE AO ON PAGE 13 OF THE _ASSESSMENT ORDER THEN THE AMOUNT OF REMUNERATION WILL BE LESS THAN RS. 54 LAC. THE AO HAS FURTHER OBSERVED ON PAGE 13 OF ASSESSMENT ORDER THAT SINCE THE APPELLANT HAS PAID R S. 54 LACS TO DR. RAVI SHANKAR DALMIA HENCE HE MUST HAVE GIVEN WORK OF ABO UT RS. 2 CRORES OF THE HOSPITAL. IN THE CASE OF THE APPELLANT THE GROSS RE CEIPT OF THE APPELLANT FROM CARDIAC CENTER IS MORE THAN RS. 2 CRORE HENCE EVEN AS PER THE LOGIC OF AO THE REMUNERATION PAID BY THE APPELLANT TO DR. RAVIS HANKARDAIMIA IS REASONABLE. . SECTION 13(2) PROVIDES THE EXCEPTION IN WHICH PAYM ENT CAN BE MADE TO THE PERSON COVERED UNDER SECTION 13(3) OF THE AC T. SUB-SECTION (C) OF SECTION 13(2) PROVIDES THAT IF THE PERSON COVERED U NDER SECTION 13(3) IS PAID REMUNERATION FOR SERVICES RENDERED BY HIM AT R EASONABLE RATE THEN THE PROVISION OF SECTION 13(3) WILL NOT APPLY. IN THE PRESENT CASE I AM OF THE VIEW THAT THE REMUN ERATION PAID TO DR. RAVI SHANKAR DALMIA WHO IS FULL TIME LOOKING AF TER THE CARDIAC CENTER OF THE APPELLANT AND IS ATTENDING EMERGENCIES AND I S NOT DOING ANY PRIVATE PRACTICE IS REASONABLE AND ACCORDINGLY THE BENEFIT OF SECTION 11 CANNOT BE DENIED TO APPELLANT FOR PAYING REMUNERATION OF RS 5 4,00,000/- TO DR. RAVI SHANKAR DALMIA. (III) PAYMENT TO DR SUNIL AGRAWAL ORTHOPEDIC- THEAPPELLANT IS MAKING PAYMENT TO DOCTORS ON THE BASIS OF FEES COLL ECTED BY THE APPELLANT ON SURGERY DONE BY THEM. IN THE CASE OF DR. ABHISHE K BOHRE THE APPELLANT ITA NO.147 /AGR/2017 11 HAS PAID NEARLY 41.3% OF FEES COLLECTED ON WORK DON E BY HIM AS HIS REMUNERATION. SIMILARLY IN THE CASE OF DR. SUNIL SH RIVASTAV THE APPELLANT HAS PAID AS REMUNERATION NEARLY 40% OF FEES COLLECT ED ON WORK DONE BY HIM. IN THE CASE OF THE DR. SUNIL AGRAWAL THE APPELLANT HAS PAID AS REMUNERATION 40.36% OF FEES COLLECTED ON THE SURGER Y DONE BY HIM. AS PER THE ID AR THE APPELLANT HAS MADE PAYMENT TO DRAGRAW ALIN SIMILAR MANNER IN EARLIER ASSESSMENT YEARS. THE ID AR FURTHER SUBMI TTED THAT SHRI S.K. AGRAWALRELATIVE OF DR. SUNIL AGRAWAL WAS THE TRUSTE E DURING THE PERIOD FROM 13.02.2015 TO 07.04.2015 I.E. SHRI SK AGRAWAL WAS NOT THE TRUSTEE OF THE APPELLANT IN THE PREVIOUS RELEVANT TO ASSESSMEN T YEAR 2012-13 OR EARLIER ASSESSMENT YEAR . CONSIDERING THE TOTALITY OF THE FACT, I AM OF THE V IEW THAT THE REMUNERATION PAID TO DR. SUNIL AGRAWAL IS REASONABL E AND THE BENEFIT OF SECTION 11 CANNOT BE DENIED DUE TO THE PAYMENT OF R EMUNERATION TO DR. SUNIL AGRAWAL BY THE APPELLANT. (IV) PAYMENT TO DR PRATISHTHADALMIA - AS PER THE ID AR THE APPELLANT HAS PAID A PART OF FEES COLLECTED ON THE WORK OF DOCTOR S IN GAYNIC DEPARTMENT AS REMUNERATION TO DOCTORS. IN THE CASE OF MOHINISH RIVASTAV THE APPELLANT HAS PAID AS REMUNERATION 29.56% OF FEES COLLECTED O N THE SURGERY ETC DONE BY HER. SIMILARLY IN THE CASE OF DR, SANGEETA SINGH THE APPELLANT HAS PAID AS REMUNERATION 26.77% OF FEES COLLECTED ON SURGERY ET C DONE BY HER. IN THE CASE OF DRPRATISHTHADALMIA THE APPELLANT PAI D HER AS REMUNERATION 28.47% OF FEES COLLECTED ON SURGERY ET C DONE BY HER. LOOKING TO TOTALITY OF THE FACT I AM OF THE VIEW THAT REMUN ERATION PAID BY THE APPELLANT TO DR. PRATISTHADALMIA IS REASONABLE AND FOR THE REASON OF PAYMENT OF REMUNERATION TO DR. PRATISHTHADALMIA THE EXEMPTION UNDER SECTION 11 CANNOT BE DENIED. (V) PAYMENT TO KUSUM AGRAWAL-THE APPELLANT DOES NOT HAVE C ARM MACHINE WHICH IS USED ORTHOPEDIC OPERATION . THE APP ELLANT HAS ENTERED INTO AN AGREEMENT WITH KUSUMAGRAWAL IN EARLIER YEAR TO PROVIDE THIS MACHINE. AS PER THE ID AR AT THE TIME OF AGREEMENT THE RELATIVE OF SMT. KUSUMAGRAWAL WAS NOT TRUSTEE OF THE APPELLANT. AS P ER THE ID AR THE PAYMENT AT SIMILAR RATE HAS BEEN MADE IN EARLIER, Y EAR ALSO. SINCE THE PAYMENT MADE TO KUSUMAGRAWAL IN EARLIER Y EAR.HAS BEEN ACCEPTED AS REASONABLE HENCE IN VIEW OF PRINCIPLE O F CONSISTENCY I AM OF THE ITA NO.147 /AGR/2017 12 VIEW THAT THE BENEFIT OF EXEMPTION UNDER SECTION 11 CANNOT BE DENIED TO THE APPELLANT ON ACCOUNT OF PAYMENT OF C ARM MACHINE CH ARGES RECEIVED FROM PATIENT TO SMT. KUSUMAGRAWAL. (VI) PAYMENT TO SUNIL DALMIA - SHRI SUNIL DALMIA IS LOOKING AFTER GENERAL ADMINISTRATION OF HOSPITAL AND EDUCATIONAL INSTITUT IONS RUN BY THE APPELLANT. AS PER THE ID AR THE REMUNERATION WAS PA ID TO HIM IN EARLIER ASSESSMENT YEARS ALSO AND IN ORDER PASSED UNDER SEC TION 143(3) THESE PAYMENT HAS BEEN ACCEPTED AS REASONABLE. SINCE THE PAYMENT MADE TO SHRI SUNIL DALMIA IN EARL IER YEAR HAS BEEN ACCEPTED AS REASONABLE HENCE IN VIEW OF PRINCIPLE O F CONSISTENCY I AM OF THE VIEW THAT THE BENEFIT OF EXEMPTION UNDER SECTION 11 CANNOT BE DENIED TO THE APPELLANT ON ACCOUNT OF PAYMENT OF REMUNERATION TO SHRI SUNIL DALMIA. 5.2.1 DECISION: AFTER CAREFULLY CONSIDERING THE ARG UMENT ADVANCED ON BEHALF OF THE APPELLANT AND PERUSING THE FACTS OF T HE CASE AND OTHER MATERIAL AVAILABLE ON RECORD , THIS ISSUE IS DECIDE D AS UNDER:- AS STATED BY THE AO THE APPELLANT HAS NOT CLAIMED E XEMPTION UNDER SECTION 10(23C)(VIA) OF THE ACT AND DURING THE APPELLATE PR OCEEDING NO SPECIFIC SUBMISSION IN SUPPORT OF THIS GROUND HAS BEEN ADVAN CED HENCE THIS GROUND IS DISMISSED AS NOT PRESSED. 8. THE REVENUE FEELING AGGRIEVED BY THE DECISION FI LED THE APPEAL BEFORE US ON THE ABOVE SAID GROUND. 9. THE LD. CIT DR HAD SUBMITTED THAT THE DECISION O F THE CIT(A) WAS BASED ON THE WRITTEN SUBMISSION FILED BY THE AO WHERE THE ASSESS EE HAD RELIED UPON THE AGREEMENT OF DR. NAVIN BHAMARI OF MAX SUPER SPECIAL TY HOSPITAL AND ON THE BASIS OF THAT IT WAS CONCLUDED BY THE LD. CIT(A) THAT THE RE MUNERATION PAID TO DR. RAVI SHANKAR DALMIA WAS A REASONABLE COMPOSITION. IT WAS SUBMITTED THAT THE FINDING OF THE LD. CIT(A) IS AGAINST THE PRINCIPLE OF NATURAL JUSTICE AND THERE IS CLEAR CUT VIOLATION OF RULE 46A BY THE LD. CIT(A) AS REPORT O F AO WAS NOT CALLED UPON ON THE AGREEMENT OF DR BHAMRI , DURING THE APPELLATE PROCE EDING. ITA NO.147 /AGR/2017 13 9.1 IN REBUTTAL, IT WAS SUBMITTED BY THE LD. AR TH AT THE REVENUE HAS NOT FILED ANY GROUND URGING VIOLATION OF PRINCIPLE OF NATURAL JUS TICE OR CHALLENGING THE CONSIDERATION OF THE AGREEMENT BY THE CIT(A) IN VIO LATION OF RULE 46A. 9.2 BESIDES THAT IT WAS SUBMITTED BY AR THAT THE A O AT PAGE 13 HAD MENTIONED THAT FOR MAKING THE PAYMENTS OF SALARY OF RS.54.00 LAKH THERE SHOULD BE REVENUE EARNED BY THE HOSPITAL SHOULD RS.2.00 CRORES. IT WA S SUBMITTED THAT REVENUE RECEIVED BY THE ASSESSEE FOR THE ASSESSMENT YEAR UN DER CONSIDERATION WAS RS.3,37,14,000/-( RS 3.37 CRORE) . IT WAS SUBMITTED THAT THE REMUNERATION OF SALARY PAID TO DOCTORS WERE NOT ONLY BASED ON REVENUE COLL ECTED BY THE HOSPITAL BUT IS ALOS DEPENDENT UPON SPECIALIZATION,EXPERTISE, ABLE TOSAT ISFY AND GIVE RESULTS TO PATIENT ETC. 9.3 THE BENCH DURING THE COURSE OF ARGUMENT HAD DIR ECTED THE ASSESSEE TO FILE A COMPARATIVE STATEMENT FOR THE F.YS. 2009-10 AND 201 0-11 SHOWING THE REVENUE COLLECTED AND AMOUNT PAID TO DOCTORS. THE TABLE SHO WING THE REVENUE COLLECTED AN AMOUNT PAID TO F.YS. 2009-10, 2010-11 AND 2011-12 A RE AS UNDER: S.NO. NAME QUALIFICATION DESIGNATION RELATION AMOUNT PAID 1. DR. RAVI SHANKAR DALMIA M.D. (MEDICINE) GOLD MEDALIST D.M. CARDIOLOGY DIRECTOR BIMR HEART CENTER SON OF SHRI B.D. DALMIA PRESIDENT/EXECUTIVE TRUSTEE SALARY RS.54,00,000 2. DR. PRATHISTHA DALMIA M.D. (OBS- GYNAE) VISITING CONSULTANT DAUGHTER IN LAW OF SH. B.D. DALMIA PRESIDENT/EXECUTIVE TRUSTEE VISITING FEE RS.10,45,507/- 3. DR. SUNIL AGARWAL ORTHOPEDIC SURGEON VISITING CONSULTANT SON OF SHRI S.K. AAGRAWAL TRUSTEE VISITING FEE RS.29,27,418/- 4. SMT. KUSUM AGARWAL N.A. N.A. WIFE OF SH. S.K. AG RWAL TRUSTEE C-ARM MACHINE RS.4,15,676 5. MR. SUNIL DALMIA B.COM SR. EXECUTIVE (COMMERCIAL) NEPHEW OF SH. B.D. DALMIA PRESIDENT/EXECUTIVE TRUSTEE SALARY RS.4,56,000/- ITA NO.147 /AGR/2017 14 10. IT WAS FURTHER SUBMITTED BY AR THAT IN ALL THE PREVIOUS ASSESSMENT YEAR THE CASE OF THE ASSESSEE WASEXAMINED AND THE PAYMENT MA DE BY THE ASSESSEE TO THE DOCTORS HAVE BEEN ACCEPTED BY THE AO. OUR ATTENTION WAS ALSO DRAWN TO THE ASSESSMENT ORDER BASED FOR THE A.Y. 2010-11 WHERE T HE SIMILAR PAYMENT OF RS.36.15 LAKH WAS ALLOWED BY THE REVENUE COLLECTED FOR AN AM OUNT OF RS.2,39,60,000/-. IT WAS SUBMITTED THAT THE PRESENT APPEAL FILED BY THE REVE NUE WITHOUT ANY BASIS AND THE LD. AR RELIED UPON THE FOLLOWING JUDGMENT: 1. CIT(EXEMPTION VS. BHOLA RAM EDUCATIONAL SOCIETY , (SC) 2019 ITL 59 2. PRATAP WAHINISAMAJ KALYAN VS. DEPT. OF INCOME TA X, ITA NO. 301/AGRA/2012 3. PRATAP WAHINISAMAJ KALYAN VS. DEPT. OF INCOME TA X, ITA NO. 242/AGRA/2011 4. PNR SOCIETY FOR SOCIETY FOR RELIEF & REHABILITAT ION OF THE DISABLED TRUST VS. THE DDIT (EXEMPTION), ITA NO.2729/AHD/2010 5. INDICULA TRUST SOCIETY VS. CIT (EXEMPTION) ITA N O.1216/DEL/2013 6. MODERN SCHOOL SOCIETY VS. CIT (EXEMPTION) ITA NO .1118/JP/2016 7. CIT EXEMPTION (PUNE) VS. SH. BALAJI SOCIETY (HIG H COURT MUMBAI) 8. ROCK CHURCH MINISTRIES VS. DDIT (E) II, ITAT HYD . ITA NO.463/HYD/2010 9. ACIT VS. MAHIMA SHIKSHA SAMITI, ITL 346: (2017) 185 TTJ 425 10. CIT VS. 21 ST SOCIETY OF IMMACULATE CONCEPTION (MAD. H.C.) 11. LOKMANYA TILAK JANKALYANSHIKSHAN SANSTHA VS. AC IT, NAGPUR, 2017 ITL 2688 12. ITO VS. VIRENDRA SINGH MEMORIAL SHIKSHA SAMITI (LUCK TRIB) (2009) 121 TTJ 829 13. CIT VS. WORKING WOMENS FORUM (LAWS (MAD) 2014- 2-222 14. DIT VS. SHETH MAFATLAL GAGALBHAI, 2001 249 ITR 533 BOM. ITA NO.147 /AGR/2017 15 11. WE HAVE HEARD THE RIVAL CONTENTIONS OF THE PART IES AND HAVE PERUSED THE RECORD OF THE CASE. IT IS UNDISPUTED FACT BEFORE TH E TRIBUNAL IS THAT THE ASSESSEE RUNNING HOSPITAL AFTER GETTING IT REGISTERED U/S 12 AA OF THE ACT. IT IS ALSO UNDISPUTED THAT THE ASSESSEE WAS HAVING APPROVAL U/S 10(23)(C) OF THE ACT. THE CASE OF THE AO IN THE PRESENT CASE IS THAT THE ASSESSEE HAS BEEN MAKI NG THE PAYMENT TO DOCTORS BY WAY OF SALARY AND PROFESSIONAL FEES WHICH IS IN EXC ESS OF WHAT MAY BE REASONABLY PAID FOR SUCH SERVICES BY THE COMPARABLE DOCTORS I N THE GWALIOR AND FOR THAT PURPOSES THE AO HAS BROUGHT ON RECORD THE COMPARABL E INSTANCES OF DOCTORS WORKING IN GAJRAJACHIKITSAMAHAVIDHYALAY AND CHIRAYU MEDICAL COLLEGE. 11.1 BEFORE WE DECIDING THIS ISSUE, WE WOULD LIKE TO BRING ON RECORD CERTAIN IMPORTANT FACT WITH RESPECT TO MEDICAL PROFESSION; I. THERE IS NO RULES OR REGULATION WHICH GOVERNS THE C HARGING OF FEES BY THE MEDICAL PROFESSIONAL. II. THERE ETHICFOR ONE DOCTOR VARIES BY THE CIRCUMSTANC ES AND PERSON TO PERSON AND PLACE TO PLACE. III. THE PROFESSIONALS ARE PAID FOR THEIR WORK DONE. IV. IN FACT , MANY PATIENT BELIEVES THAT, MORE DOCTOR S CHARGES MORE COMPETENT HE OR SHE WOULD BE. V. FURTHER THE DOCTORS AND ASSOCIATE PROFESSIONAL SER VICES ARE RESULT ORIENTED AND ITA NO.147 /AGR/2017 16 VI. HEALTH HAS BEEN MARKETED AS COMMODITY BY THE DOCTOR S AND HOSPITAL. EVEN THE RELATIVES SPENT ON HEALTH OF NEAR AND DEAR WITH A V IEW TO FULFILL THEIR OBLIGATION TOWARDS THE AILING PATIENT. VII. WE MAY MENTION THAT THE MEDICAL PROFESSION IS ALSO FULL OF UNETHICAL PRACTICES, KICKBACKS AND UNDER THE TABLE FEES. KICKBACKS ARE U LTIMATELY RECOVERED FROM THE PATIENT WHICH WOULD FORM THE PART OF THE MEDICA L FEES. VIII. THE KICKBACKS ARE GIVEN BY THE CONSULTANTS, PATHOLO GISTS, LABORATORIES, NURSING HOME, GENERAL PRACTITIONER AND OTHERS. IX. THE MEDICAL PRACTITIONER ALSO GETS LOT OF UNETHICA L FEES FROM THE MEDICINE COMPANIES IN THE FORM OF PARTIES, AIR TICKETS AND C ONFERENCES. X. UN-ETHICAL SITUATION OF MEDICAL PROFESSION FURTHER AGGRAVATESIF IT IS LEARNED THAT PATIENT BILL TAKEN CARE OF THE MEDICAL INSURAN CE OR BY EMPLOYER OF THE PATIENT AND BILLS OF PATIENT. THE PATIENT CONNIVANC E AND CONCLUSION WITH THE DOCTORS, INFLATE THE BILLS AND SHARE THE BILL ON TH E INFLATED AMOUNT. 12. IN OUR VIEW, THE FEES OF THE DOCTOR IS NOT ONLY DETERMINED BY THE COLLEGE FROM WHICH HE HAD PASSED OUT BUT ALSO DEPENDENT UPON A. WITH WHOM DR. HAS DONE THE INTERNSHIP B. HIS SENIORITY C. COMPETENCE D. EXPERTISE ITA NO.147 /AGR/2017 17 E. QUALIFICATION AND F. ABILITY TO GIVE RESULTS IN COMPLICATED AND DIFFICU LT CASES G. FURTHER, THE FEES IS ALSO DETERMINED BASED ON THE E STABLISHMENT AND EQUIPMENT ON WHICH THE DOCTORS IS WORKING H. THE TIME INVOLVED IN THE PROCEDURE/SURGERY I. LOCALITY WHERE THE HOSPITAL AND WORKING CENTER IS S ITUATED. 12.1 IN THE PRESENT CASE, THE AO HAS BROUGHT ON REC ORD THE COMPARABLE INSTANCES OF THE GAJRAJACHIKITSAMAHAVIDHYALAY AND CHIRAYU MEDICA L COLLEGE ON RECORD BUT FAILED TO BRING ON RECORD EXPERTISE , QUALIFICATION ANY OT HER FACTORS LIKE SENIORITY COMPETENCE ,EXPERIENCE, QUALIFICATION ETC. 12.2 THE AO HAS FURTHER FAILED TO BRING ON RECORD T HE REVENUE COLLECTED BY THESE HOSPITAL OR A PERIOD OF THREE YEARS AND WHAT WAS A SALARY PAID TO THESE DOCTORS. FURTHER AO FAILED TO BRING ON RECORD WHETHER SALARY PAID TO THESE DOCTORS AS MENTIONED IN ORDER WERE IN WHICH PROPORTION TO REVE NUE COLLECTED BY THE HOSPITAL OR NOT. 12.3 THE GOVERNMENT MEDICAL COLLEGE OR SALARY PAID TO THE GOVERNMENT HOSPITAL CANNOT BE COMPARED WITH THE SALARY PAID BY THE PRIV ATE HOSPITAL TO THE PRIVATE DOCTORS. IN THE ABSENCE OF NECESSARY INFORMATION WI TH RESPECT TO THAT ESTABLISHMENT OF THE HOSPITAL, THE REVENUE COLLECTED BY THE HOSPI TAL, THE COMPETENCE, EXPERIENCE ITA NO.147 /AGR/2017 18 AND THEIR ABILITY TO GIVE RESULT, IT WOULD NOT BE S AFE USE THESE AS COMPARABLE INSTANCES WITH THAT OF THE ASSESSEE. 12.4 IN OUR CONSIDERED OPINION, DOCTORS WHO HAD PA SSED OUT WITH THE SAME DEGREE IN CARDIOLOGY DM CANNOT BE COMPARED WITH EXPERIENC E DOCTOR WORKING IN THE FIELD FOR THE LAST TEN YEARS. 12.5 REPLY OF THE ASSESSEE HAD BEEN REPRODUCED BY THE AO IN PARAGRAPH 7 MENTIONED ABOVE WHICH CLEARLY MENTIONED THAT DR. R AVI SHAKAR DALMIA WAS GOLD MEDALIST AND PRIOR TO WORKING WITH THE ASSESSEE HOS PITAL, HE WAS WORKING AS CONSULTANT INTERVENTIONAL CARDIOLOGY IN ESCORT HEAR T INSTITUTE AND RESEARCH CENTRE, NEW DELHI UPTO THE YEAR 2007 AND THEREAFTER THE DOC TOR HAD STARTED BY CARDIO INTERVENTION / VALVE REPLACEMENT IN THE GWALIOR IN THE YEAR 2009 AND SINCE 2009 HE HAD DONE MORE THAN 325 CASES WITH RESPECT BYPASS SU RGERY & VALVE REPLACEMENT . NO SUCH FACT AND FIGURE WERE BROUGHT ON RECORD BY T HE AO IN HIS ORDER WITH RESPECT TO DR. VIAKS GOYAL, DR. R.K. SINGH AND DR. PUNEET R ASTOGI AND DR. RAM KUMAR. IN OUR VIEW , INTERVENTION IN HEART BY WAY ANGIOGRAPHY AND SURGICAL BYPASS AND VALVE REPLACEMENT NEEDS DIFFERENT SKILLS AND EXPERTISE I N THE MEDICAL FIELD. TO DAY WE ARE HAVING SPECIALISTS, SUPER SPECIALIST AND ORGAN SPEC IALIST IN INDIA AND OUTSIDE INDIA WITH THE SAME EDUCATIONAL QUALIFICATION. 12.6 IN OUR VIEW, DR. RAVI SHANKAR DALMIA HAVING SUFFICIENT EXPERTISE IN THE FIELD IT IS CLEAR FROM THE FACT THAT FROM 2007 HE WAS WORKI NG WITH ESCORT HOSPITAL DELHI AND ITA NO.147 /AGR/2017 19 THEREAFTER WORKING WITH THE ASSESSEE HOSPITAL WITH EFFECT FROM F.Y. 2009-10. THE CONTRIBUTION OF DOCTOR IS CLEAR FROM THE FACT THAT REVENUE COLLECTED FROM THE A.Y. 2009-10 WAS 183.26 LAKH WHEREAS THE REVENUE COLLECT ED FROM THE F.Y. 2011-12 WAS 337.14. THE REVENUE HAS INCREASED TWO TIMES IN FROM 2009-10 TO 2011-12 AND SAME WITH THE SAME RATION IT INCREASED FOR DR. RAVI SHAN KAR DALMIA. 12.6 FURTHER WE ARE OF THE OPINION THAT THE FINDIN G RECORDED BY THE AO BASED ON THE COMPARABLE INSTANCES IS WHOLLY INCORRECT. IN OU R VIEW, THE COMPARABLE INSTANCES BROUGHT ON BY THE AO ARE NOT AT ALL COMPARABLE AS T HE SERVICES RENDERED BY THE PROFESSIONAL LIKE DR. RAVI SHANKAR DALMIA CANNOT BE COMPARED WITH THE OTHER DM (CARDIOLOGISTS) OR ASSISTANT PROFESSIONAL OR PROFES SOR IN SOME MEDICAL COLLEGE OR WORKING IN OTHER HOSPITAL. IT IS EXPECTED FROM THE AO TO BRING ON RECORD THE COMPARABLE ONLY AFTER BRINGING ON RECORD THE COMPAR ISON BETWEEN TWO DOCTORS NOT ONLY ON THE BASIS OF THE MEDICAL DEGREE BUT ALSO ON THE BASIS OF EXPERTISE ETC AS MENTIONED HEREINABOVE. 12.7 IN VIEW OF ABOVE AND WE ALSO ON ACCOUNT OF COM PARABLE INSTANCE OF DR. NAVIN BHAMAR OF MAX HOSPITAL , WHICH HAVE NOT BEEN SERIO USLY DISPUTED BY THE REVENUE BY RAISING THE SPECIFIC GROUND IN THE APPEAL THE AP PEAL OF THE REVENUE DESERVES TO BE DISMISSED . FURTHER THE TRIBUNAL IS BOUND TO ADJUDI CATE AND DECIDE THE GROUND ITA NO.147 /AGR/2017 20 RAISED BY THE REVENUE AND IS BOUND TO DECIDE THE GR OUND WHICH HAS NOT BEEN URGED OR STOOD TO BE URGED BY THE REVENUE. 13. LASTLY, WE MAY ALSO LIKE POINT OUT THAT IN THE EARLIER F.Y. 2010-11, WHERE THE ORDER U/S 143(3) WAS PASSED BY THE AO THE SERVICES RENDERED BY THE SAME SET OF DOCTORS AND PAYMENT MADE TO THEM HAVE NOT BEEN DISP UTED BY AO AND SAME HAS BEEN ACCEPTED BY THE REVENUE. IN OUR CONSIDERED VIE W, THE CONSISTENCY IS REQUIRED TO BE MAINTAINED NOT ONLY BY THE ASSESSEE BUT ALSO BY THE REVENUE. 14. IN THE PRESENT CASE, THERE IS NO CHANGE OF F ACTS IN THE PRESENT AY AND FACTS CONTINUED TO BE SAME FOR THE EARLIER ASSESSMENT YEA R WHEN SIMILAR PAYMENT WERE ALLOWED BY THE AO WITHOUT INVOKING VIOLATION OF SE CTION 13 OF THE ACT. IN OUR THEREOF WE DO NOT FIND ANY ERROR IN THE ORDER PASSED BY THE LD. CIT(A) AND ACCORDINGLY APPEAL FILED BY THE REVENUE IS DISMISSED. 15. IN THE RESULT, APPEAL FILED BY THE REVENUE IS D ISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 20/09/2019) SD/- SD/- (DR. MITHA LAL MEENA) (LALIET KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 20/09/2019 AKS