J.C.I.T., Range-1, Aligarh V. Sh. Amol Chand Varshney Sewa Sansthan, Hathras

ITA 150/AGR/2012

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 0459 (ITAT-AGRA)
• Duration Of Justice: 7 year(s) 1 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 18-03-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 16-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income; Charitable institution; Question of law; Fair market value; Assessment record; Benefit of exemption; Capital expenditure; Set aside
• Section: 143(3); 12A; 12AA; 69B; 69; 56; 11; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NOS.198 &199/AGRA/2011 ASSESSMENT YEARS: 2006-07 & 2007-08 SHRI AMOL CHAND VARSHNEY SEWA VS. ADDL. COMMISS IONER OF INCOME TAX, SANSTHAN, RANGE-1, ALIGARH. NAYA GANJ, SIKANDRA RAO, HATHRAS (PAN : AABTA 3193 P). ITA NO.150/AGRA/2012 ASSESSMENT YEAR: 2008-09 JOINT COMMISSIONER OF INCOME TAX, VS. SHRI AMOL CHA ND VARSHNEY SEWA (A.O., RANGE-1, ALIGARH. SANSTHAN, NAYA GANJ, SIKANDRA RAO, HATHRAS. (PAN : AABTA 3193 P). ITA NO.156/AGRA/2012 ASSESSMENT YEARS: 2008-09 SHRI AMOL CHAND VARSHNEY SEWA VS. ADDL. COMMISS IONER OF INCOME TAX, SANSTHAN, RANGE-1, ALIGARH. NAYA GANJ, SIKANDRA RAO, HATHRAS (PAN : AABTA 3193 P). (APPELLANTS) (RESPONDENTS) ASSESSEE BY : SHRI DEEPENDRA MOHAN, C.A. REVENUE BY : SHRI WASEEM ARSHAD, SR. D.R. DATE OF HEARING : 18.03.2013 DATE OF PRONOUNCEMENT : 22.03.2013 2 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: ITA NOS.198/AGA/2011, 199/AGRA/2011 & 156/AGRA/2012 HAVE BEEN FILED BY THE ASSESSEE AGAINST DIFFERENT ORDERS DATED 29.0 3.2011, 29.03.2011 & 31.01.2012 PASSED BY THE LD. CIT(A), GHAZIABAD FOR ASSESSMENT YEARS 2006-07, 2007-08 & 2008-09 RESPECTIVELY. ITA NO.150/AGRA/20 12 HAS BEEN FILED BY THE REVENUE AGAINST THE ORDER DATED 31.01.2012 PASSED B Y THE LD. CIT(A), GHAZIABAD FOR ASSESSMENT YEAR 2008-09. 2. THE LD. REPRESENTATIVES OF THE PARTIES SUBMITTED THAT THE FACTS OF THE CASE LEAD IN A.Y. 2007-08 AND HENCE THESE APPEALS HAVE B EEN ARGUED ON THE BASIS OF FACTS FOR A.Y. 2007-08. WE, THEREFORE, DECIDE THES E APPEALS CONSIDERING THE FACTS OF THE CASE FOR A.Y. 2007-08 I.E. ITA NO.199/AGRA/2 011. FOR KNOWING THE EXACT GROUNDS OF APPEAL, WE ARE REPRODUCING THE GROUNDS R AISED BY THE ASSESSEE IN ITS APPEAL FOR A.Y. 2007-08 AS UNDER :- 1) THAT THE LEARNED ASSESSING OFFICER AND THE COMM ISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN DENYING EXEMPTION U/S 11 & 12 OF THE INCOME-TAX ACT, 1961. 3 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 2. THAT THE LEARNED ASSESSING OFFICER AND THE COMMI SSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN REFERRING THE MATTER TO THE VALUATION OFFICER FOR DETERMINING THE COST OF CONSTRUCTION OF BUILDING AND ADOPTING THE SAME WITH OUT DISPOSING THE APPELLANTS OBJECTION SO RAISED. 3) THAT THE LEARNED ASSESSING OFFICER AND THE COMMI SSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN TREATING THAT THERE WAS VIOLATION OF PROVISION OF SECTION 13(1)(C ) READ WITH SECTION 13(3) OF THE INCOME-TAX ACT, 1961 WITHOUT THERE BEI NG ANY NEXUS OR MATERIAL ON RECORD TO SUBSTANTIATE THE SAME. 4) THAT THE LEARNED ASSESSING OFFICER AND THE COMMI SSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN MAKING ADDITION OF RS.48,74,000/- ON ACCOUNT OF DONATIONS RECEIVED FOR CORPUS OF THE SOCIETY AS ASSESSEES INCOME. 5) THAT THE ORDER PASSED BY THE AUTHORITIES BELOW I S BAD IN LAW AND AGAINST THE FACTS OF THE CASE. 3. IN ONE OF THE COMMON GROUNDS, I.E. GROUND NO.4, WHEREIN THE ASSESSEE HAS CHALLENGED ADDITIONS OF WHICH DETAILS ARE GIVEN AS UNDER :- A.Y. 2007-08 RS.48,74,000/- A.Y. 2006-07 RS.71,69,500/- A.Y. 2008-09 RS.9,84,762/- 4. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E SOCIETY IS RUNNING AN EDUCATIONAL SCHOOL. DURING THE ASSESSMENT PROCEEDI NGS, THE A.O NOTICED THAT THE ASSESSEE HAS CONSTRUCTED A BUILDING. THE MATTER WA S REFERRED TO THE DISTRICT VALUATION OFFICER, INCOME TAX DEPARTMENT (D.V.O.) T O ESTIMATE THE ACTUAL 4 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 INVESTMENT IN CONSTRUCTION OF BUILDING. THE D.V.O. HAS SUBMITTED THE REPORT AND FINALLY REVISED REPORT DATED 03.12.2009 WAS SUBMITT ED WHEREIN FOLLOWING DIFFERENCE IN COST OF CONSTRUCTION OF BUILDING WAS NOTICED. THE YEAR-WISE CONSTRUCTION COST ESTIMATED BY THE D.V.O. AND BOOKS OF ACCOUNT IS AT PAGE NO 37 OF THE PAPER BOOK. 5. THE A.O. ASKED THE ASSESSEE FOR THEIR COMMENTS O N D.V.O.S REPORT AND THE D.V.O.S REPORT DATED 03.12.2009 WAS GIVEN TO THE A SSESSEE. AFTER CONSIDERING THE ASSESSEES SUBMISSION, THE A.O. REJECTED THE ASSESS EES OBJECTION RAISED BY LETTER DATED 14.12.2009 ON HE GROUND THAT THE OBJECTION RA ISED BY THE ASSESSEE HAS ALREADY BEEN TAKEN CARE BY THE D.V.O. THE A.O. HAS TAKEN T HE VIEW THAT THE DIFFERENCE IN THE AMOUNT CLAIMED TO HAVE BEEN SPENT BY THE ASSESS EE ON CONSTRUCTION OF BUILDING AND ESTIMATION MADE BY THE D.V.O. WAS SO HUGE THAT IT CAN LEAD TO ONLY ONE CONCLUSION THAT THE MONEY WAS BEING SIPHONED OUT OF THE SOCIETY TO BENEFIT THE MANAGING TRUSTEE. THUS, THERE BEING CLEAR VIOLATIO N OF SECTION 13(1)(C)(II) OF THE INCOME TAX ACT, 1961. SINCE THE ASSESSEE SOCIETY H AS VIOLATED THE PROVISIONS OF SECTION 13(3) READ WITH SECTION 13(1)(C) OF THE ACT , THE PROVISIONS OF SECTION 11 AND 12 OF THE ACT SHALL NOT OPERATE SO AS TO CONCLUDE I NCOME FROM TOTAL INCOME OF THE PREVIOUS YEAR. CONSEQUENTLY, THE A.O. HELD THAT TH E ASSESSEE SOCIETY IS NOT ENTITLED TO EXEMPTION UNDER SECTION 11 AND 12 OF THE ACT AND EXEMPTION WAS ACCORDINGLY 5 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 WITHDRAWN. THE A.O. COMPUTED THE INCOME IN NORMAL COMMERCIAL MANNER. IN A.Y. 2008-09, THE A.O. ALSO HELD THAT CAPITAL EXPEN DITURE SHALL NOT BE TREATED AS APPLICATION OF INCOME. ACCORDINGLY THE A.O. CALCUL ATED THE TOTAL INCOME FOR A.Y. 2007-08 AS UNDER :- (PAGE NO.11) SURPLUS AS PER INCOME & EXPENDITURE ACCOUNT RS.1,1 3,52,755/- ADD: DONATION RECEIVED AS PER BALANCE SHEET RS. 4 8,74,000/- -------------------- TOTAL RS.1,62,26,755/- 6. THE CIT(A) HAS CONFIRMED THE ORDER OF THE A.O. F OLLOWING HIS ORDER FOR A.Y. 2005-06. THE RELEVANT FINDING OF CIT(A) IS REPRODU CED AS UNDER :- (PAGE NOS.22 23 & 24) 5.1 THE, ISSUE THIS YEAR IS SAME AS THAT IN THE EA RLIER YEAR I.E. A.Y. 2005-06. THE ASSESSEES SUBMISSION IS ALSO SAME FOR BOTH THE YEARS. SO, THE FINDINGS IN THIS YEAR ARE LINKED TO THE FIN DINGS IN A.Y. 2005- 06; WHEREIN SIMILAR ISSUE FOR DIFFERENCE IN VALUATI ON IN PROPERTY AND INVOCATION OF SECTION 13 WAS ADJUDICATED BY ME AS U NDER :- .5.1 THE ENTIRE CASE OF A.O. AND ALL THE GROUNDS OF APPEAL OF APPELLANT REVOLVE AROUND DENIAL OF EXEMPT ION TO APPELLANT U/S 11 & 12, ON THE GROUND OF VIOLATION O F PROVISIONS OF SECTION 13. IT IS CLEAR FROM THE FACTS ON RECORD THAT BOOKS OF ACCOUNTS WERE NEVER PRODUCED FOR VERIFICATION. I AGREE WITH AO THAT THE APPELLANTS STORY OF MISPLACEMENT OF BOOKS IS TOO S LOPPY AND SUSPICIOUS TO GENERATE ANY CREDENCE. BOOKS OF ACCOU NTS ARE TREATED TO BE NOT AVAILABLE AND UNRELIABLE AND REJE CTED. 6 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 5.2 MORE IMPORTANTLY, HAD APPELLANT BEEN GENUINE A ND SINCERE IN ITS APPROACH AND ATTITUDE, IT SHOULD HAV E FULFILLED ITS PREMISE OF COLLECTING DUPLICABLE, BILLS FROM VARIOU S PARTIES, WITHIN A MONTH I.E. BY DECEMBER, 2007 (AS PREMISE; PLEASE REFER TO ASSESSMENT ORDER PAGE 14), AND, EVEN IF VI EWED MORE LENIENTLY, LATEST BY DECEMBER, 2008 (TIME OF ONE MO RE YEAR) WHEN THE ASSESSMENT WAS FINALLY COMPLETED!! SO, VIEWED CAREFULLY; THE APPELLANTS LONG STORY OF IMPROPER O PPORTUNITY, IS ACTUALLY A FARSE; THE AO IS CORRECT IN POINTING OUT THAT APPELLANT NEVER WANTED TO COOPERATE EITHER WITH AO OR DVO, AN D, NATURALLY, HAD SOMETHING TO HIDE. I REJECT ASSESSEE S ALL CONTENTIONS OF INADEQUATE OPPORTUNITY. 5.3 THE REFERENCE TO DVO, IN ABSENCE OF BOOKS AND BILLS/VOUCHERS, IS PERFECTLY JUSTIFIED. THE MECHANI SM OF GETTING INVESTMENT VALUED BY DEPARTMENTAL EXPERTS HAS BEEN SPECIFICALLY ENVISAGED FOR MANY SUCH CIRCUMSTANCES, THE PRESENT ONE SQUARELY FALLING UNDER THOSE. IT HAS TO BE NOTED CAREFULLY THAT THE ASSESSEE DID NOT COOPERATE AT ALL WITH DVO: SUCH NON-COOPERATION IS GROSSLY CLEAR FROM THE PERUSAL OF ASSESSMENT RECORDS. SO, I F SOME ITEMS OF CONSTRUCTION HAVE NOT BEEN VALUED BY THE DVO; TH E FAULT HAS TO BE ASCRIBED TO THE ASSESSEE ONLY. FURTHER, IF WE READ PAGE 14, LOST---BUT---ONE PARA CAREFULLY, WE FIND THAT DVOS REPORT WAS CONFRONTED TO THE MANAGING TRUSTEE, BUT SRI VIPIN VARSHNEY STATED THA T HE HAS NOTHING MORE TO SAY ON ESTIMATE ARRIVED AT BY THE D VO. 5.4 AS FAR AS, ASSESSEES CONTENTION THAT ITS OBJEC TIONS TO DVOS VALUATION WERE NOT ADJUDICATED BY AO, IS CONC ERNED; THE SAME HAS NO FORCE BECAUSE DVO SPECIFICALLY DEALT WI TH APPELLANTS ALL OBJECTIONS AND AO WAS, WITHIN HIS R IGHTS, TO RELY ON DVOS TECHNICALLY EXPERT OPINIONS. I HAVE GONE THROUGH ALL THOSE OBJECTIONS RAISED BY ASSESSEE, AND FIND THAT ASSESSEE HAS NO MORAL AND TECHNICAL RIGHT TO RAISE AND INSIST ON THOSE OBJECTIONS, WHEN IT CHOSE TO NON-COOPERATE BY NOT P ROCEEDING ANY RELEVANT DETAILS. ALSO, I FIND NO FORCE IN THOS E TECHNICAL 7 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 OBJECTIONS, ON MERITS ALSO. IT MAY BE NOTED THAT NO DOCUMENTARY EVIDENCE LIKE TECHNICAL ESTIMATES, DRAWINGS AND APP ROVED PLANS, DUPLICATE BILLS ETC. HAVE BEEN PRODUCED, EVE N DURING APPEAL. THE MOOT POINT IS THAT EVEN IF SOME ADJUSTMENTS, H ERE AND THERE, ARE ALLOWED; A GLARING GAP REMAINS BETWEEN T HE VALUE OF CONSIDERATION, AS DECLARED BY THE ASSESSEE VIS--VI S THAT ESTIMATED BY THE DVO, EVEN AFTER GIVING SOME MARGIN S FOR RATES ADOPTED, OR SUPERVISION ETC. SO, THE AO WAS CORRECT IN DETECTING AND ESTABLISHI NG THAT THIS CASE IS A GLARING EXAMPLE OF PRESENT DAY SYND ROM OF TRUSTEES SIPHONING OFF THE FUND BY INFLATING/OVERIN VOCING THE COST OF CONSTRUCTION. 5.5 THE AO IS ABSOLUTELY JUSTIFIED, ALSO IN HOLDING THAT SINCE ALL THE EXPENDITURE WAS UNDER THE CONTROL OF MANAGI NG TRUSTEE SRI VIPIN VARSHNEY, IT CAN BE CONCLUDED THAT HE BEN EFITED FROM SUCH SIPHONING OFF OF TRUST FUND, AND, SO THERE WAS A CLEAR VIOLATION OF PROVISION OF SECTION 13, TO PENALIZE S UCH CASES OF FINANCIAL FRAUD, AND I FIND THIS CASE TO BE AN APPR OPRIATE ONE TO BE BROUGHT UNDER THE RIGOURS OF SECTION 13. 7. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THERE IS NO DISPUTE ABOUT THE FACT THAT THE ASSESSEE SOCIETY IS REGISTERED UN DER SECTION 12AA OF THE ACT. THE LD. AUTHORISED REPRESENTATIVE DREW OUR ATTENTION TO PAGE NO.34 OF THE ASSESSEES PAPER BOOK WHERE A COPY OF REGISTRATION GRANTED UND ER SECTION 12AA OF THE ACT W.E.F. 01.04.2003 DATED 12.07.2004 HAS BEEN PLACED. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT AS PER THE REVISED RE PORT OF THE D.V.O., THE DIFFERENCE WAS ALSO POINTED OUT IN A.YS. 2009-10 & 2010-11 BUT IN THOSE ASSESSMENT YEARS THE A.O. DID NO MAKE ANY ADDITION AND RETURNED FIGURE HAS BEEN 8 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 ACCEPTED BY THE A.O. WHILE MAKING ASSESSMENT UNDER SECTION 143(3) OF THE ACT. THE LD. AUTHORISED REPRESENTATIVE FILED PHOTOCOPIES OF ASSESSMENT ORDERS FOR THE A.YS. 2008-09 & 2009-10 THIS HAS BEEN PLACED ON REC ORD. THE LD. AUTHORISED REPRESENTATIVE FURTHER SUBMITTED THAT IN A.Y. 2005- 06 THERE IS A DIFFERENCE IN COST OF CONSTRUCTION SHOWN BY THE ASSESSEE AND ESTIMATED BY THE D.V.O., BUT NO ACTION HAS BEEN TAKEN IN THIS REGARD BY THE REVENUE. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE A.O. DID NOT CONSIDER THE VARIOU S OBJECTIONS REGARDING ESTIMATION OF CONSTRUCTION COST BY THE D.V.O. THE LD. AUTHORISED REPRESENTATIVE FURTHER SUBMITTED THAT IN AY 2007-08 THE A.O. REFER RED THE MATTER TO THE D.V.O. WITHOUT REJECTING THE BOOKS OF ACCOUNT. THE LD. AU THORISED REPRESENTATIVE SUBMITTED THAT THE REFERENCE IS INVALID AS THE MATT ER HAS BEEN REFERRED TO D.V.O. WITHOUT REJECTING THE BOOKS OF ACCOUNTS. THE LD. A UTHORISED REPRESENTATIVE IN SUPPORT OF HIS CONTENTION RELIED UPON THE DECISION OF I.T.A.T., AGRA BENCH IN THE CASE OF PRAHLAD KUMAR JINDAL VS. ACIT IN ITA NO.137 /AGR/2012, ORDER DATED 21.09.2012 AND NEOTRIC CONSTRUCTION VS. DIT IN ITA NO.449/AGR/2010, ORDER DATED 24.02.2012. 8. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE FACT IN A.Y. 2006-07, 2007-08 & 2008-09 IS SLIGHTLY DIFFERENT THAT IN THA T IN A.Y. 2006-07 THE BOOKS OF 9 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 ACCOUNTS WERE LOST AND IN A.YS. 2007-08 & 2008-09 THE BOOKS OF ACCOUNTS WAS IMPOUNDED BY THE A.O. 9. AS REGARDS VIOLATION OF PROVISIONS OF SECTION 13 (1)(C) READ WITH SECTION 13(2)(A) OF THE ACT, THE LD. AUTHORISED REPRESENTAT IVE SUBMITTED THAT THE A.O. WAS NOT JUSTIFIED TO ADD DONATION TO THE INCOME OF THE ASSESSEE SOCIETY TO CONCLUDE THAT THE FUND OF THE SOCIETY HAS BEEN SIPHONED OUT TO BE NEFIT THE MANAGING TRUSTEE SHRI VIPIN VARSHNEY. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THIS FINDING OF THE A.O. IS WITHOUT ANY BASIS. 10. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THA T ON IDENTICAL SET OF FACTS LUCKNOW BENCH OF I.T.A.T. HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE IN THE CASE OF ITO VS. VIRENDRA SINGH MEMORIAL SHIKSHA SAM ITI, 121 TTJ (LUCK.) 829. 11. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTH ER HAND, RELIED UPON THE ORDER OF CIT(A) AND SUBMITTED THAT THE RELEVANT PRO VISIONS CLEARLY COVER THE CASES WHERE INCOME OR PROPERTY DEEMED TO HAVE BEEN BENEFI TTED. THEREFORE, THE CIT(A) AND A.O. BOTH HAVE RIGHTLY TAKEN A VIEW THAT THE MA NAGING TRUSTEE HAS DEEMED TO BE BENEFITED BY INFLATING COST OF CONSTRUCTION. AS REGARDS REFERENCE TO D.V.O., THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE DID NOT PRODUCE THE 10 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 BOOKS OF ACCOUNT AS IN A.Y. 2006-07 IT WAS STATED T HAT THE BOOKS OF ACCOUNT HAD BEEN LOST. HE SUBMITTED THAT IN THE ABSENCE OF BOO KS OF ACCOUNT THE A.O. HAS RIGHTLY TAKEN THE DIFFERENCE ESTIMATED BY THE D.V.O . IN HIS REPORT. 12. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PA RTIES AND RECORDS PERUSED. SOME OF THE ADMITTED FACTS OF THE CASE ARE THAT THE ASSESSEE SOCIETY IS A REGISTERED SOCIETY UNDER SECTION 12AA OF THE ACT. THE CASE OF THE REVENUE IS THAT THE ASSESSEE HAS INFLATED CONSTRUCTION COST OF THE BUIL DING. THE YEAR WISE DIFFERENCES IN CONSTRUCTION COST SHOWN BY THE ASSESSEE AND ESTI MATED AS PER D.V.O.S REPORT IS REPRODUCED FROM COPY OF REVISED REPORT OF D.V.O. FI LED IN ASSESSEES PAPER BOOK AS UNDER :- (PAGE NO.37) COST OF CONSTRUCTION OF THE BUILDING AS FINANCIAL YEAR DECLARED BY THE ASSESSEE (RS.) ESTIMATE BY THIS OFFICE (RS.) 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 11,34,79,803/- 11,71,00,416/- 11,91,55,538/- 49,75,649/- 19,36,420/- 25,26,136/-* 72,41,350/- 91,86,343/- 1,02,88,403/- 26,12,919/- 10,40,245/- 13,57,040/-* * UPTODATE EXPD. DT. 11.11.09 TOTAL 5,91,73,962/- 3,17,86,300/- 11 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 13. THE A.O. WAS OF THE VIEW THAT THE INFLATED AMOU NT HAS BEEN SIPHONED BY THE MANAGING TRUSTEE SHRI VIPIN VARSHNEY. THEREFORE, T HE BENEFIT OF SECTION 11 OF THE ACT IS NOT AVAILABLE TO THE ASSESSEE AS THE ASSESSE E HAS VIOLATED THE PROVISIONS OF SECTION 13(1)(C) OF THE ACT. 14. THE CRUX OF THE ISSUE TO BE CONSIDERED IN THESE APPEALS WHETHER THE A.O. HAS CORRECTLY INVOKED SECTION 13 OF THE ACT. FOR THE P URPOSE OF READY REFERENCE, SECTION 13 OF THE ACT IS REPRODUCED AS BELOW :- 13 . (1) [NOTHING CONTAINED IN SECTION 11 OR SECTION 12] SHALL OPERATE SO AS TO EXCLUDE FROM THE TOTAL INCOME OF THE PREVIOUS YE AR OF THE PERSON IN RECEIPT THEREOF (A) ANY PART OF THE INCOME FROM THE PROPERTY HELD U NDER A TRUST FOR PRIVATE RELIGIOUS PURPOSES WHICH DOES NOT ENURE FOR THE BEN EFIT OF THE PUBLIC : (B) IN THE CASE OF A TRUST FOR CHARITABLE PURPOSES OR A CHARITABLE INSTITUTION CREATED OR ESTABLISHED AFTER THE COMMENCEMENT OF TH IS ACT, ANY INCOME THEREOF IF THE TRUST OR INSTITUTION IS CREATED OR E STABLISHED FOR THE BENEFIT OF ANY PARTICULAR RELIGIOUS COMMUNITY OR CASTE ; [(BB) * * * * ] (C) IN THE CASE OF A TRUST FOR CHARITABLE OR RELIGI OUS PURPOSES OR A CHARITABLE OR RELIGIOUS INSTITUTION, ANY INCOME THEREOF (I) IF SUCH TRUST OR INSTITUTION HAS BEEN CREATED O R ESTABLISHED AFTER THE COMMENCEMENT OF THIS ACT AND UNDER THE TERMS OF THE TRUST OR THE RULES GOVER NING THE INSTITUTION, ANY PART OF SUCH INCOME ENURES, OR (II) IF ANY PART OF SUCH INCOME OR ANY PROPERTY OF THE TRUST OR INSTITUTION (WHENEVER CREATED OR ESTABLISHED) IS DURING THE PRE VIOUS YEAR USED OR 12 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 APPLIED, DIRECTLY OR INDIRECTLY FOR THE BENEFIT OF ANY PERSON REFERRED TO IN SUB-SECTION (3): PROVIDED THAT IN THE CASE OF A TRUST OR INSTITUTION CREATED OR ESTABLISHED BEFORE THE COMMENCEMENT OF THIS ACT, THE PROVISIONS OF SUB-CLAUSE (II) SHALL NOT APPLY TO ANY USE OR APPLICATION, WHETHER DIRECT LY OR INDIRECTLY, OF ANY PART OF SUCH INCOME OR ANY PROPERTY OF THE TRUST OR INSTITUTION FOR THE BENEFIT OF ANY PERSON REFERRED TO IN SUB-SECTION (3), IF SU CH USE OR APPLICATION IS BY WAY OF COMPLIANCE WITH A MANDATORY TERM OF THE TRUS T OR A MANDATORY RULE GOVERNING THE INSTITUTION : PROVIDED FURTHER THAT IN THE CASE OF A TRUST FOR RELIGIOUS PURPOSES OR A RELIGIOUS INSTITUTION (WHENEVER CREATED OR ESTABLIS HED) OR A TRUST FOR CHARITABLE PURPOSES OR A CHARITABLE INSTITUTION CRE ATED OR ESTABLISHED BEFORE THE COMMENCEMENT OF THIS ACT, THE PROVISIONS OF SUB -CLAUSE (II) SHALL NOT APPLY TO ANY USE OR APPLICATION, WHETHER DIRECTLY O R INDIRECTLY, OF ANY PART OF SUCH INCOME OR ANY PROPERTY OF THE TRUST OR INSTITU TION FOR THE BENEFIT OF ANY PERSON REFERRED TO IN SUB-SECTION (3) IN SO FAR AS SUCH USE OR APPLICATION RELATES TO ANY PERIOD BEFORE THE 1ST DAY OF JUNE, 1 970. [(D) IN THE CASE OF A TRUST FOR CHARITABLE OR RELIG IOUS PURPOSES OR A CHARITABLE OR RELIGIOUS INSTITUTION, ANY INCOME THEREOF, IF FO R ANY PERIOD DURING THE PREVIOUS YEAR (I) ANY FUNDS OF THE TRUST OR INSTITUTION ARE INVES TED OR DEPOSITED AFTER THE 28TH DAY OF FEBRUARY, 1983, OTHERWISE THAN IN ANY O NE OR MORE OF THE FORMS OR MODES SPECIFIED IN SUB-SECTION (5) OF SECTION 11 ; OR (II) ANY FUNDS OF THE TRUST OR INSTITUTION INVESTED OR DEPOSITED BEFORE THE 1ST DAY OF MARCH, 1983 OTHERWISE THAN IN ANY ONE OR MOR E OF THE FORMS OR MODES SPECIFIED IN SUB-SECTION (5) OF SECTION 11 CO NTINUE TO REMAIN SO INVESTED OR DEPOSITED AFTER THE 30TH DAY OF NOVEMBE R, 1983 ; OR [(III) ANY SHARES IN A COMPANY, OTHER THAN (A) SHARES IN A PUBLIC SECTOR COMPANY; (B) SHARES PRESCRIBED AS A FORM OR MODE OF INVESTME NT UNDER CLAUSE (XII) OF SUB-SECTION (5) OF SECTION 11, ARE HELD BY THE TRUS T OR INSTITUTION AFTER THE 30TH DAY OF NOVEMBER, 1983:] 13 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 PROVIDED THAT NOTHING IN THIS CLAUSE SHALL APPLY IN RELATIO N TO (I) ANY ASSETS HELD BY THE TRUST OR INSTITUTION WHE RE SUCH ASSETS FORM PART OF THE CORPUS OF THE TRUST OR INSTITUTION AS ON THE 1S T DAY OF JUNE, 1973 [****]; [(IA) ANY ACCRETION TO THE SHARES, FORMING PART OF THE CORPUS MENTIONED IN CLAUSE (I), BY WAY OF BONUS SHARES ALLOTTED TO THE TRUST OR INSTITUTION;] (II) ANY ASSETS (BEING DEBENTURES ISSUED BY, OR ON BEHALF OF, ANY COMPANY OR CORPORATION) ACQUIRED BY THE TRUST OR INSTITUTION B EFORE THE 1ST DAY OF MARCH, 1983 ; [(IIA) ANY ASSET, NOT BEING AN INVESTMENT OR DEPOSI T IN ANY OF THE FORMS OR MODES SPECIFIED IN SUB-SECTION (5) OF SECTION 11, W HERE SUCH ASSET IS NOT HELD BY THE TRUST OR INSTITUTION, OTHERWISE THAN IN ANY OF THE FORMS OR MODES SPECIFIED IN SUB-SECTION (5) OF SECTION 11, AFTER T HE EXPIRY OF ONE YEAR FROM THE END OF THE PREVIOUS YEAR IN WHICH SUCH ASSET IS ACQUIRED OR THE 31ST DAY OF MARCH, [1993], WHICHEVER IS LATER;] (III) ANY FUNDS REPRESENTING THE PROFITS AND GAINS OF BUSINESS, BEING PROFITS AND GAINS OF ANY PREVIOUS YEAR RELEVANT TO THE ASSE SSMENT YEAR COMMENCING ON THE 1ST DAY OF APRIL, 1984, OR ANY SUBSEQUENT AS SESSMENT YEAR. EXPLANATION.- WHERE THE TRUST OR INSTITUTION HAS A NY OTHER INCOME IN ADDITION TO PROFITS AND GAINS OF BUSINESS, THE PROV ISIONS OF CLAUSE (III) OF THIS PROVISO SHALL NOT APPLY UNLESS THE TRUST OR INSTITU TION MAINTAINS SEPARATE BOOKS OF ACCOUNT IN RESPECT OF SUCH BUSINESS.] [EXPLANATION.- FOR THE PURPOSES OF SUB-CLAUSE (II) OF CLAUSE (C), IN DETERMINING WHETHER ANY PART OF THE INCOME OR ANY P ROPERTY OF ANY TRUST OR INSTITUTION IS DURING THE PREVIOUS YEAR USED OR APP LIED, DIRECTLY OR INDIRECTLY, FOR THE BENEFIT OF ANY PERSON REFERRED TO IN SUB-SE CTION (3), IN SO FAR AS SUCH USE OR APPLICATION RELATES TO ANY PERIOD BEFORE THE 1ST DAY OF JULY, 1972, NO REGARD SHALL BE HAD TO THE AMENDMENTS MADE TO THIS SECTION BY SECTION 7 [OTHER THAN SUB-CLAUSE (II) OF CLAUSE (A) THEREOF] OF THE FINANCE ACT, 1972.] (2) WITHOUT PREJUDICE TO THE GENERALITY OF THE[PROV ISIONS OF CLAUSE (C) AND CLAUSE (D)] OF SUBSECTION (1), THE INCOME OR THE PR OPERTY OF THE TRUST OR 14 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 INSTITUTION OR ANY PART OF SUCH INCOME OR PROPERTY SHALL, FOR THE PURPOSES OF THAT CLAUSE, BE DEEMED TO HAVE BEEN USED OR APPLIED FOR THE BENEFIT OF A PERSON REFERRED TO IN SUB-SECTION (3), (A) IF ANY PART OF THE INCOME OR PROPERTY OF THE T RUST OR INSTITUTION IS, OR CONTINUES TO BE, LENT TO ANY PERSON REFERRED TO IN SUB- SECTION (3) FOR ANY PERIOD DURING THE PREVIOUS YEAR WITHOUT EITHER ADEQUATE SECURITY OR ADEQUATE INTEREST OR BO TH ; (B) IF ANY LAND, BUILDING OR OTHER PROPERTY OF THE TRUST OR INSTITUTION IS, OR CONTINUES TO BE, MADE AVAILABLE FOR THE USE OF ANY PERSON REFERRED TO IN SUB-SECTION (3), FOR ANY PERIOD DURI NG THE PREVIOUS YEAR WITHOUT CHARGING ADEQUATE RENT OR OTH ER COMPENSATION; (C) IF ANY AMOUNT IS PAID BY WAY OF SALARY, ALLOWA NCE OR OTHERWISE DURING THE PREVIOUS YEAR TO ANY PERSON REFERRED TO IN SUB- SECTION (3) OUT OF THE RESOURCES OF THE TRUST OR IN STITUTION FOR SERVICES RENDERED BY THAT PERSON TO SUCH TRUST OR I NSTITUTION AND THE AMOUNT SO PAID IS IN EXCESS OF WHAT MAY BE REAS ONABLY PAID FOR SUCH SERVICES ; (D) IF THE SERVICES OF THE TRUST OR INSTITUTION AR E MADE AVAILABLE TO ANY PERSON REFERRED TO IN SUBSECTION (3) DURING THE PREVIOUS YEAR WITHOUT ADEQUATE REMUNERATION OR OTHER COMPENS ATION ; (E) IF ANY SHARE, SECURITY OR OTHER PROPERTY IS PU RCHASED BY OR ON BEHALF OF THE TRUST OR INSTITUTION FROM ANY PERSON REFERRED TO IN SUB-SECTION (3) DURING THE PREVIOUS YEAR FOR CONSID ERATION WHICH IS MORE THAN ADEQUATE ; (F) IF ANY SHARE, SECURITY OR OTHER PROPERTY IS SO LD BY OR ON BEHALF OF THE TRUST OR INSTITUTION TO ANY PERSON REFERRED TO IN SUB- SECTION (3) DURING THE PREVIOUS YEAR FOR CONSIDERAT ION WHICH IS LESS THAN ADEQUATE ; [(G) IF ANY INCOME OR PROPERTY OF THE TRUST OR INS TITUTION IS DIVERTED DURING THE PREVIOUS YEAR IN FAVOUR OF ANY PERSON RE FERRED TO IN SUB-SECTION (3): 15 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 PROVIDED THAT THIS CLAUSE SHALL NOT APPLY WHERE THE INCOME OR THE VALUE OF THE PROPERTY OR, AS THE CASE MAY BE, T HE AGGREGATE OF THE INCOME AND THE VALUE OF THE PROPERTY, SO DIV ERTED DOES NOT EXCEED ONE THOUSAND RUPEES ;] (H) IF ANY FUNDS OF THE TRUST OR INSTITUTION ARE, OR CONTINUE TO REMAIN, INVESTED DURING THE PREVIOUS YEAR (NOT BEIN G A PERIOD BEFORE THE 1ST DAY OF JANUARY, 1971,) IN ANY CONCER N IN WHICH ANY PERSON REFERRED TO IN SUB-SECTION (3) HAS A SUB STANTIAL INTEREST. (3) THE PERSONS REFERRED TO IN CLAUSE (C) OF SUB-SE CTION (1) AND SUB-SECTION (2) ARE THE FOLLOWING, NAMELY : (A) THE AUTHOR OF THE TRUST OR THE FOUNDER OF THE INSTITUTION; [(B) ANY PERSON WHO HAS MADE A SUBSTANTIAL CONTRIB UTION TO THE TRUST OR INSTITUTION, THAT IS TO SAY, ANY PERSON WHOSE TO TAL CONTRIBUTION UPTO THE END OF THE RELEVANT PREVIOUS YEAR EXCEEDS [FIFTY THOUSAND] RUPEES ;] (C) WHERE SUCH AUTHOR, FOUNDER OR PERSON IS A HIND U UNDIVIDED FAMILY, A MEMBER OF THE FAMILY; [(CC) ANY TRUSTEE OF THE TRUST OR MANAGER (BY WHAT EVER NAME CALLED) OF THE INSTITUTION ;] (D) ANY RELATIVE OF ANY SUCH AUTHOR, FOUNDER, PERS ON, [MEMBER, TRUSTEE OR MANAGER] AS AFORESAID; (E) ANY CONCERN IN WHICH ANY OF THE PERSONS REFERR ED TO IN CLAUSES (A), (B), [(C), (CC)] AND (D) HAS SUBSTANTIAL INTEREST. (4) NOTWITHSTANDING ANYTHING CONTAINED IN CLAUSE (C ) OF SUB-SECTION (1)[BUT WITHOUT PREJUDICE TO THE PROVISIONS CONTAINED IN CL AUSE (D) OF THAT SUB- SECTION, IN A CASE WHERE] THE AGGREGATE OF THE FUND S OF THE TRUST OR INSTITUTION 16 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 INVESTED IN A CONCERN IN WHICH ANY PERSON REFERRED TO IN SUB-SECTION (3) HAS A SUBSTANTIAL INTEREST, DOES NOT EXCEED FIVE PER CE NT OF THE CAPITAL OF THAT CONCERN, THE EXEMPTION UNDER [SECTION 11 OR SECTION 12] SHALL NOT BE DENIED IN RELATION TO ANY INCOME OTHER THAN THE INCOME ARI SING TO THE TRUST OR THE INSTITUTION FROM SUCH INVESTMENT, BY REASON ONLY TH AT THE [FUNDS OF THE TRUST OR THE INSTITUTION] HAVE BEEN INVESTED IN A CONCERN IN WHICH SUCH PERSON HAS A SUBSTANTIAL INTEREST. [(5) * * * *] [(5) NOTWITHSTANDING ANYTHING CONTAINED IN CLAUSE ( D) OF SUB-SECTION (1), WHERE ANY ASSETS BEING DEBENTURES ISSUED BY, OR ON BEHALF OF, ANY COMPANY OR CORPORATION) ARE ACQUIRED BY THE TRUST OR INSTIT UTION AFTER THE 28TH DAY OF FEBRUARY, 1983 BUT BEFORE THE 25TH DAY OF JULY, 199 1, THE EXEMPTION UNDER SECTION 11 OR SECTION 12 SHALL NOT BE DENIED IN REL ATION TO ANY INCOME OTHER THAN THE INCOME ARISING TO THE TRUST OR THE INSTITU TION FROM SUCH ASSETS, BY REASON ONLY THAT THE FUNDS OF THE TRUST OR THE INST ITUTION HAVE BEEN INVESTED IN SUCH ASSETS IF SUCH FUNDS DO NOT CONTINUE TO REMAIN SO INVESTED IN SUCH ASSETS AFTER THE 31ST DAY OF MARCH, 1992.] [(6) * * * * ] [(6) NOTWITHSTANDING ANYTHING CONTAINED IN SUB-SECT ION (1) OR SUB-SECTION (2), BUT WITHOUT PREJUDICE TO THE PROVISIONS CONTAI NED IN SUB-SECTION (2) OF SECTION 12, IN THE CASE OF A CHARITABLE OR RELIGIOU S TRUST RUNNING AN EDUCATIONAL INSTITUTION OR A MEDICAL INSTITUTION OR A HOSPITAL, THE EXEMPTION UNDER SECTION 11 OR SECTION 12 SHALL NOT BE DENIED IN RELATION TO ANY INCOME, OTHER THAN THE INCOME REFERRED TO IN SUB-SECTION (2 ) OF SECTION 12, BY REASON ONLY THAT SUCH TRUST HAS PROVIDED EDUCATIONAL OR ME DICAL FACILITIES TO PERSONS REFERRED TO IN CLAUSE (A) OR CLAUSE (B) OR CLAUSE ( C) OR CLAUSE (CC) OR CLAUSE (D) OF SUB-SECTION (3).] [(7) NOTHING CONTAINED IN SECTION 11 OR SECTION 12 SHALL OPERATE SO AS TO EXCLUDE FROM THE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT THEREOF, ANY ANONYMOUS DONATION REFERRED TO IN SECT ION 115BBC ON WHICH TAX IS PAYABLE IN ACCORDANCE WITH THE PROVISIONS OF THAT SECTION.] [(8) NOTHING CONTAINED IN SECTION 11 OR SECTION 12 SHALL OPERATE SO AS TO EXCLUDE ANY INCOME FROM THE TOTAL INCOME OF THE PRE VIOUS YEAR OF THE PERSON 17 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 IN RECEIPT THEREOF IF THE PROVISIONS OF THE FIRST P ROVISO TO CLAUSE (15) OF SECTION 2 BECOME APPLICABLE IN THE CASE OF SUCH PER SON IN THE SAID PREVIOUS YEAR.]. [EXPLANATION 1.- FOR THE PURPOSES OF SECTIONS 11, 12, 12A AND THIS SECTION, 'TRUST' INCLUDES ANY OTHER LEGAL OBLIGATION AND FOR THE PURPOSES OF THIS SECTION 'RELATIVE', IN RELATION TO AN INDIVIDUAL, M EANS (I) SPOUSE OF THE INDIVIDUAL ; (II) BROTHER OR SISTER OF THE INDIVIDUAL; (III) BROTHER OR SISTER OF THE SPOUSE OF THE INDIV IDUAL ; (IV) ANY LINEAL ASCENDANT OR DESCENDANT OF THE IND IVIDUAL ; (V) ANY LINEAL ASCENDANT OR DESCENDANT OF THE SPOU SE OF THE INDIVIDUAL; (VI) SPOUSE OF A PERSON REFERRED TO IN SUB-CLAUSE (II), SUB-CLAUSE (III), SUB- CLAUSE (IV)OR SUB-CLAUSE (V); (VII) ANY LINEAL DESCENDANT OF A BROTHER OR SISTER OF EITHER THE INDIVIDUAL OR OF THE SPOUSE OF THE INDIVIDUAL.] EXPLANATION 2.- A TRUST OR INSTITUTION CREATED OR ESTABLISHED FOR THE BENEFIT OF SCHEDULED CASTES, BACKWARD CLASSES, SCHEDULED TR IBES OR WOMEN AND CHILDREN SHALL NOT BE DEEMED TO BE A TRUST OR INSTI TUTION CREATED OR ESTABLISHED FOR THE BENEFIT OF A RELIGIOUS COMMUNIT Y OR CASTE WITHIN THE MEANING OF CLAUSE (B) OF SUB-SECTION (1). EXPLANATION 3.- FOR THE PURPOSES OF THIS SECTION, A PERSON SHALL BE DEEMED TO HAVE A SUBSTANTIAL INTEREST IN A CONCERN, (I) IN A CASE WHERE THE CONCERN IS A COMPANY, IF IT S SHARES (NOT BEING SHARES ENTITLED TO A FIXED RATE OF DIVIDEND WHETHER WITH O R WITHOUT A FURTHER RIGHT TO PARTICIPATE IN PROFITS) CARRYING NOT LESS THAN TWEN TY PER CENT OF THE VOTING POWER ARE, AT ANY TIME DURING THE PREVIOUS YEAR, OW NED BENEFICIALLY BY SUCH PERSON OR PARTLY BY SUCH PERSON AND PARTLY BY ONE O R MORE OF THE OTHER PERSONS REFERRED TO IN SUB-SECTION (3); (II) IN THE CASE OF ANY OTHER CONCERN, IF SUCH PERS ON IS ENTITLED, OR SUCH PERSON AND ONE OR MORE OF THE OTHER PERSONS REFERRE D TO IN SUB-SECTION (3) ARE ENTITLED IN THE AGGREGATE, AT ANY TIME DURING T HE PREVIOUS YEAR, TO NOT LESS THAN TWENTY PER CENT OF THE PROFITS OF SUCH CO NCERN.] 18 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 15. SECTION 13 MAKES AN EXCEPTION TO THE EXEMPTION GRANTED UNDER SECTION 11 READ WITH SECTION 12 BY WAY OF EXCLUSION FROM TOTAL INCOME. SECTION 13(1) NARRATES THE SITUATIONS WHEREUNDER THE BENEFIT OF EXEMPTION IS NOT AVAILABLE UNDER SECTION 11 READ WITH SECTION 12 WHEREAS SECTION 13(2), BY W AY OF A DEEMING PROVISION, NARRATES CERTAIN SITUATIONS UNDER WHICH THE INCOME OR PROPERTY WILL BE DEEMED TO HAVE BEEN USED OR APPLIED FOR THE BENEFIT OF SPECIF IED PERSONS SO THAT EXEMPTION IS TO BE DENIED UNDER THE PROVISIONS OF SECTION 13(1). 15.1 BRIEFLY SPEAKING AS PER SECTION 13(1) IN FO LLOWING CASES THE BENEFIT OF EXEMPTION UNDER SECTION 11 IS BARRED:- (A) WHERE THE TRUST/INSTITUTION IS FOR PRIVATE RELI GIOUS PURPOSES AND DOES NOT ENURE FOR THE BENEFIT OF THE PUBLIC [S.13(1)(A)]; (B) WHERE THE TRUST/INSTITUTION IS CREATED OR ESTAB LISHED AFTER THE COMMENCEMENT OF THE ACT, I.E., AFTER 1 ST APRIL, 1962 AND THE SAME IS FOR THE BENEFIT OF ANY PARTICULAR COMMUNITY OR CASTE [S.13( 1)(B)]; (BB) BUSINESS INCOME OF TRUSTS ESTABLISHED FOR RELI EF OF THE POOR, EDUCATION OR MEDICAL RELIEF UNLESS THE BUSINESS IS CARRIED ON IN THE COURSE OF THE ACTUAL CARRYING OUT OF A PRIMARY PURPOSE OF THE TRUSTOR IN STITUTION [S.13(1)(BB)]. THIS CLAUSE WAS IN FORCE ONLY FOR ASST. YRS 1977-78 TO 1 983-84 (BOTH YEARS INCLUSIVE). HOWEVER CONSEQUENT TO THE INSERTION OF SUB-SECTION (4A) IN SECTION 11 THIS CLAUSE BECAME REDUNDANT AND WAS OMI TTED AND EFFECT FROM THE ASST. YR. 1984-85; (C) (I) WHERE THE TRUST/INSTITUTION IS ESTABLISHED AFTER 1 ST APRIL, 1962, ANY PART OF ITS INCOME ENSURES FOR THE BENEFIT OF SPECIFIED PERSONS [S. 13(1) (C) (I)]; (II) IF ANY PARTY OF THE INCOME OR PROPERTY OF THE TRUST/INSTITUTION IS USED OR APPLIED DIRECTLY OR INDIRECTLY FOR THE BENEFIT OF S PECIFIED PERSONS SUBJECT TO 19 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 THE TWO PROVISOS GIVEN UNDER THE SUB-CL. (C) AND AL SO SUBJECT TO THE EXPLANATION GIVEN UNDER SUB-CL. (D) [S.13(1)(C)(II) ]; BOTH THESE SUB-CLAUSES ARE ALSO SUBJECT TO SUB-SECT ION (4) OF SECTION 13. (D) WHEN THE INVESTMENT PATTERN OF THE TRUST/INSTI TUTION IS NOT IN ACCORDANCE WITH THAT PRESCRIBED IN SECTION 11(5) OR SUCH PATTE RN IS IN INVESTMENTS OF THE CATEGORY PROHIBITED IN THE SUB CL. (D) OF SECTION 1 3(1), SUBJECT TO THE PROVISO TO THE SAME SUB-CL. (D) READ ALONG WITH EXPLANATION THERETO OF SECTION 13. [SECTION 13(1)(D)]. SUB-SECTION (2) OF SECTION 13 SPECIFIES CERTAIN SIT UATIONS WHEREUNDER THE PROPERTY OR INCOME OF THE TRUST OR INSTITUTION IS D EEMED TO HAVE BEEN USED OR APPLIED FOR THE BENEFIT OF ANY OF THE PERSONS SPECI FIED IN SUB-SECTION (3). 16. FROM A BARE READING OF AFORESAID PROVISIONS, IT WILL BE SEEN THAT FOR APPLICABILITY OF CLAUSE (C) OF SUB-SECTION (1) OF S ECTION 13 READ WITH CLAUSE (B) OF SUB-SECTION (2) OF SECTION 13 OF THE ACT, CONDITION S MENTIONED IN SUB-SECTION (3) READ WITH EXPLANATION (3) HAVE TO BE FULFILLED EXEM PTION CAN BE DENIED ONLY WHERE THE CONDITIONS MENTIONED IN THE AFORESAID PROVISION S ARE NOT FULFILLED. IN THE CASE OF COMMISSIONER OF INCOME TAX VS. HPS SOCIAL WELFAR E FOUNDATION [2010] 329 ITR (DELHI) WHERE IN THE ASSESSING OFFICER WAS OF T HE VIEW THAT THE DONATIONS HAD BEEN GIVEN AT THE SWEET WILL OF THE ASSESSEE AND H AD BEEN USED FOR THE PERSONAL BENEFITS. HE CONCLUDED THAT THE ASSESSEE WAS A TOOL IN THE HANDS OF HCL, WHERE DONATIONS WERE BEING USED FOR PERSONAL BENEFITS. AC CORDINGLY, HE DENIED THE BENEFIT OF EXEMPTION UNDER SECTIONS 11 AND 12 OF TH E INCOME TAX ACT, 1961. THE 20 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 CIT(A) DELETED THE ADDITION. THE ORDER OF THE CIT( A) HAS BEEN CONFIRMED BY THE ITAT. IN THE APPEAL FILED BY THE REVENUE BEFORE TH E HIGH COURT IT WAS HELD THAT IF THE ASSESSING OFFICER DOUBTED ANY PARTICULAR DONATI ON, HE COULD HAVE SUMMONED THE OFFICE BEARERS OF THE ORGANIZATION WHICH RECEIV ED THAT DONATION. THAT HAVING NOT BEEN DONE, HE COULD NOT HAVE DISPUTED THE GENUI NENESS OF THE DONATIONS. THE COURT FURTHER HELD THAT THERE WAS ABSOLUTELY NO MAT ERIAL BEFORE THE ASSESSING OFFICER TO SHOW THAT THE FUNDS GIVEN TO THIS NGOS/I NSTITUTION WERE USED FOR PERSONAL BENEFIT OF HCL. THEREFORE, IT CANNOT BE SA ID THAT THE FINDING OF FACT RECORDED BY THE CIT(A) AND INCOME TAX APPELLATE TRI BUNAL UPHOLDING GENUINENESS OF THE DONATION IS PERVERSE, CALLING F OR INTERVENTION BY THE COURT. IT WAS FURTHER HELD THAT NO CONTRAVENTION OF SECTION 1 3 OF THE INCOME TAX ACT HAVING BEEN MADE OUT AND THE GENUINENESS OF THE DONATIONS HAVING BEEN ACCEPTED BY THE COMMISSIONER AS WELL AS BY THE INCOME TAX APPELLATE TRIBUNAL. THE COURT HELD THAT NO SUBSTANTIAL QUESTION OF LAW ARISES. IN THE PRESENT CASE UNDER CONSIDERATION, THERE IS NOTHING ON RECORD TO SHOW THAT THE MANAGIN G TRUSTEE SHRI VIPIN VARSHNEY IN FACT INFLATING THE CONSTRUCTION COST FOR HIS BEN EFITS. IF THE A.O. WAS HAVING ANY DOUBT, HE COULD HAVE SUMMONED THE OFFICE BEARERS OF THE TRUST AND CONCERNED PARTIES RELATED TO CONSTRUCTION EXPENDITURE INCURRE D. THAT HAVING NOT BEEN DONE, HE COULD NOT HAVE DISPUTED THE GENUINENESS OF THE EXPE NDITURES. THERE WAS ABSOLUTELY NO MATERIAL BEFORE THE ASSESSING OFFICER TO SHOW TH AT THE MANAGING TRUSTEE SHRI 21 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 VIPIN VARSHNEY IN FACT INFLATING THE CONSTRUCTION C OST FOR HIS BENEFITS. THE REVENUE HAS FAILED TO BRING ON RECORD ANY EVIDENCE IN THE FORM OF BILL, VOUCHER OR OTHER RECORDS PROVING THAT THE AMOUNT OF PURCHASE W HICH HAS ACCOUNTED FOR IN THE CONSTRUCTION COST AND MONEY HAS BEEN TAKEN BY THE M ANAGING TRUSTEE OR THE GOODS PURCHASED WAS USED BY THE MANAGING TRUSTEE FOR HIS PERSONAL BENEFIT. THERE IS NO EVIDENCE THAT THE INCOME OF THE SOCIETY WAS USED OR APPLIED DIRECTLY OR INDIRECTLY FOR THE BENEFIT OF MANAGING TRUSTEE. IT IS NOT THE CASE OF THE REVENUE THAT THE MANAGING TRUSTEE BENEFITED DIRECTLY OR INDIRECTLY A S LISTED/ PROVIDED IN SUB-SECTION (2) OF SECTION 13 OF THE ACT. THE TERM BENEFIT E XCLUDE FROM ITS AMBIT A TWO WAY PROCESS. IF THE PERSON IN THE PROHIBITED CATEGORY RENDERS SERVICES AND IN LIEU THEREOF A BENEFIT IS PROVIDED THEN THE CASE DOES NO T FALL IN CLAUSE(II) OF SECTION 13(1)(C) OF THE ACT. THE EXPENDITURE INCURRED ON T HOSE INTERESTED PERSONS WOULD BE A COMPENSATION FOR SUCH SERVICES. A BENEFIT WOULD BE SAID TO HAVE BEEN GIVEN TO THE PERSONS OF PROHIBITED CATEGORY, IF THEY IN RETU RN DO NOTHING BUT ONLY ENJOY THE FRUITS OF THE TRUST/SOCIETY AND TAKE AWAY THE FUNDS /INCOME OF THE SOCIETY FOR THEIR PERSONAL BENEFIT OR DISCHARGING PERSONAL OBLIGATION . THERE IS NO SUCH SITUATION IN THE CASE UNDER CONSIDERATION. SECTION 13 OF THE AC T CARVES OUT AN EXCEPTION TO THE GENERAL EXEMPTION GRANTED UNDER SECTIONS 11 & 12 OF THE ACT TO INCOME DERIVED BY TRUSTS/CHARITABLE INSTITUTIONS. THE ONUS LIES ON T HE REVENUE TO BRING ON RECORD, COGENT MATERIAL/EVIDENCE TO ESTABLISH THAT THE TRUS T/CHARITABLE INSTITUTION HIT BY THE 22 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 PROVISIONS OF SECTION 13 OF THE ACT. AS NOTED ABOV E THAT IN THE PRESENT CASE, THE A.O. MADE OUT THE CASE ON PRESUMPTION SINCE THERE I S A DIFFERENCE BETWEEN THE COST OF CONSTRUCTION SHOWN IN THE BOOKS OF ACCOUNT AND E STIMATED BY THE D.V.O. THE A.O. HAS NEITHER BROUGHT ON RECORD ANY EVIDENCE NOR ABLE TO POINT OUT MODUS OPERANDI HOW WAS THE MANAGING TRUSTEE DIRECTLY OR I NDIRECTLY BENEFITED OUT OF THE CONSTRUCTION COST OF BUILDING OF THE SOCIETY. THER E IS NO NEED TO MENTION THAT THE REGISTERED SOCIETY RUNNING EDUCATIONAL PROGRAMMES M ANAGED BY TRUSTEES. THE DAY-TO-DAY ACTIVITIES OF THE SOCIETY ARE SUPPOSED T O BE ADMINISTRATED AND CONTROLLED BY THE MANAGING COMMITTEE BY HOLDING VARIOUS MEETIN GS AND PASSING RESOLUTION ETC. THE BUILDING IN WHICH IMPUGNED INVESTMENT STA TED TO BE MADE HAS BEEN STATED TO BE SHOWN BY THE SOCIETY IN ITS BOOKS OF ACCOUNT. THEREFORE, IF ANY BENEFIT IS GOING THAT WOULD BE GOING TO THE SOCIETY ONLY AND I N THOSE CIRCUMSTANCES THERE IS NO VIOLATION OF SECTION 13 OF THE ACT. THE LD. AUT HORISED REPRESENTATIVE SUBMITTED THAT THE BUILDING BELONGED TO THE SOCIETY AND NOT T O THE MANAGING TRUSTEE. ANY COMPLAINT LODGED BY THE SOCIETY AGAINST MANAGING TR USTEE, SHRI VIPIN VARSHNEY IN THIS REGARDS THAT THE COST OF CONSTRUCTION OF THE BUILDING HAS BEEN INFLATED BY MANAGING TRUSTEE SHRI VIPIN VARSHNEY FOR HIS BENEF IT SAME IS NOT ON RECORD NOR IS POINTED OUT AT THE TIME OF HEARING BEFORE US. TH E LD. DEPARTMENTAL REPRESENTATIVE DID NOT CONTROVERT THESE FACTS POINTED OUT BY THE L D. AUTHORISED REPRESENTATIVE. HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. KAMLA TOWN TRUST, 279 ITR 23 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 89 (ALL.) HELD THAT THE BURDEN WAS ON THE REVENUE T O PROVE THAT SECTION 13 APPLIES. IT WAS OBSERVED THAT SECTION 13 OF THE ACT CARVES O UT AN EXCEPTION TO THE GENERAL EXEMPTION GRANTED UNDER SECTIONS 11 & 12 OF THE ACT TO INCOME DERIVED BY TRUSTS/CHARITABLE INSTITUTIONS. THE ONUS LIES ON T HE REVENUE TO BRING ON RECORD, COGENT MATERIAL/EVIDENCE TO ESTABLISH THAT THE TRUS T/CHARITABLE INSTITUTION IS HIT BY THE PROVISIONS OF SECTION 13 OF THE ACT. AS DISCUS SED ABOVE, THE A.O. HAS COMPLETELY FAILED TO BRING ANY SORT OF EVIDENCE OR MATERIAL BASED ON WHICH IT CAN BE SAID THAT THE MANAGING TRUSTEE SHRI VIPIN VARSHNEY BENEFITED DIRECTLY OR INDIRECTLY TO INVOKE SECTION 13 OF THE ACT. THE REVENUE FAILED TO DISCHARGE BURDEN IN THIS REGARD. THEREFORE, UNDER THE CIRCUMSTANCES AND IN ABSENCE OF THE MATERIAL, THE VIEW OF REVENUE AUTHORITIES CANNOT BE UP HELD. THE REVENUE IS OF THE VIEW THAT AS PER THE PROVISIONS OF SECTION 13(1)(C)(II) OF THE A CT IT IS DEEMED TO BENEFIT TO THE MANAGING TRUSTEE AS COVERED BY THE WORDS DIRECTLY AND INDIRECTLY. IT IS TO NOTE THAT THE REVENUE AUTHORITIES HAVE FAILED TO DISTING UISH DIFFERENCE BETWEEN INDIRECT BENEFITS AND PRESUMPTION OF BENEFITS. BOTH ARE SEP ARATE SITUATIONS. EVEN IN CASE OF INDIRECT BENEFIT, THERE MUST BE CERTAIN EVIDENCES, IT CAN NOT BE HELD ON PRESUMPTION BASIS THAT MANAGING TRUSTEE WAS BENEFITED BY INFLAT ING CONSTRUCTION COST. IN THE CASE UNDER CONSIDERATION, ENTIRE BASIS OF THE A.O. IS ON PRESUMPTION AND SUCH PRESUMPTION IS NOT SUSTAINABLE IN LAW. 24 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 17. IF WE CONSIDER THE ISSUE FROM ANOTHER ANGLE, WE NOTICE THAT THE REVENUE HAS FOLLOWED INCONSISTENCY APPROACH WHILE DECIDING THE ISSUE. THERE WERE SIMILAR DIFFERENCES IN CASE OF CONSTRUCTION SHOWN BY THE AS SESSEE AND ESTIMATED BY THE D.V.O. IN AY 2009-2010 AND 2010-2011 BUT WHILE MAKI NG ASSESSMENTS UNDER SECTION 143(3), NO ADDITION WAS MADE. FURTHER, DIF FERENCE WAS ALSO THERE IN A.Y. 2005-06 BUT THE A.O. DID NOT TAKE ANY ACTION IN THI S REGARD. THUS, THE DEPARTMENT IS NOT CLEAR ABOUT THE VIEW AND NOT FOLLOWING PRINC IPLE OF CONSISTENCY. UNDER THE CIRCUMSTANCES, THE VIEW TAKEN BY THE A.O. IN THE YE ARS UNDER CONSIDERATION ON THE BASIS OF PRESUMPTION CANNOT BE UPHELD. 18. IN A.Y. 2007-08 THE A.O. REFERRED THE MATTER DU RING THE ASSESSMENT PROCEEDINGS TO THE D.V.O. UNDER SECTION 142A OF THE ACT WHICH IS CONTRARY TO THE LAW LAID DOWN BY THE APEX COURT IN THE CASE OF SARG AM CINEMA VS. CIT, 328 ITR 513 (SC), WHEREIN IT HAS BEEN HELD THAT REFERENCE U NDER SECTION 142A CANNOT BE MADE UNLESS THE BOOKS OF ACCOUNT IS NOT REJECTED. I N THE CASE UNDER CONSIDERATION FOR AY 2007-2008 THE AO REFERRED THE MATTER TO DVO WITHOUT REJECTING BOOKS OF ACCOUNT WHICH IS CONTRARY TO THE LAW LAID DOWN BY T HE APEX COURT IN THE CASE OF SARGAM CINEMA VS. CIT, 328 ITR 513 (SC), 25 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 19. IN A.Y. 2007-08 THE A.O. HAS REFERRED THE MATTE R TO THE D.V.O. UNDER SECTION 142A(1) OF THE ACT. FOR READY REFERENCE, THE RELEV ANT SECTION 142A(1) IS REPRODUCED UNDER :- 142A. (1) FOR THE PURPOSES OF MAKING AN ASSESSME NT OR RE- ASSESSMENT UNDER THIS ACT, WHERE AN ESTIMATE OF THE VALUE OF ANY INVESTMENT REFERRED TO IN SECTION 69 OR SECTION 69B OR THE VALUE OF ANY BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE REFERR ED TO IN SECTION 69A OR [SECTION 69B OR FAIR MARKET VALUE OF ANY PROPERT Y REFERRED TO IN SUB-SECTION (2) OF SECTION 56 IS REQUIRED TO BE MAD E], THE ASSESSING OFFICER MAY REQUIRE THE VALUATION OFFICER TO MAKE A N ESTIMATE OF SUCH VALUE AND REPORT THE SAME TO HIM. (2) THE VALUATION OFFICER TO WHOM A REFERENCE IS MA DE UNDER SUB- SECTION (1) SHALL, FOR THE PURPOSES OF DEALING WITH SUCH REFERENCE, HAVE ALL THE POWERS THAT HE HAS UNDER SECTION 38A OF THE WEALTH-TAX ACT, 1957 (27 OF 1957). (3) ON RECEIPT OF THE REPORT FROM THE VALUATION OFF ICER, THE ASSESSING OFFICER MAY, AFTER GIVING THE ASSESSEE AN OPPORTUNI TY OF BEING HEARD, TAKE INTO ACCOUNT SUCH REPORT IN MAKING SUCH ASSESS MENT OR RE- ASSESSMENT: PROVIDED THAT NOTHING CONTAINED IN THIS SECTION SHALL APPLY IN RESPECT OF AN ASSESSMENT MADE ON OR BEFORE THE 30 TH DAY OF SEPTEMBER, 2004, AND WHERE SUCH ASSESSMENT HAS BECOME FINAL AND CONC LUSIVE ON OR BEFORE THAT DATE, EXCEPT IN CASES WHERE A REASSESSM ENT IS REQUIRED TO BE MADE IN ACCORDANCE WITH THE PROVISIONS OF SECTIO N 153A. EXPLANATION.- IN THIS SECTION, VALUATION OFFICER HAS THE SAME MEANING AS IN CLAUSE (R) OF SECTION 2 OF THE WEALTH -TAX ACT, 1957 (27 OF 1957).] 26 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 20. ON READING OF ABOVE SUB-SECTION (1) OF SECTION 142A WE NOTICE THAT A REFERENCE UNDER SECTION 142A CAN BE MADE BY THE A.O . ONLY UNDER THOSE CIRCUMSTANCES FOR ESTIMATING THE VALUE OF THE INVES TMENT REFERRED IN THE SECTION 69 TO 69B OR FAIR MARKET VALUE OF ANY PROPERTY PROVIDE D IN THE SECTION. AS PER SECTION 69 IF THE INVESTMENT WAS NOT RECORDED IN THE BOOKS OF ACCOUNT AND UNDER SECTION 69B UNDER THE CIRCUMSTANCES WHERE THE A.O. WAS OF T HE VIEW THAT THE INVESTMENT ACQUIRING PRESCRIBED ASSET EXCEEDS THE AMOUNT RECOR DED IN THE BOOKS OF ACCOUNT. IN THE CASE UNDER CONSIDERATION, SECTION 69 IS NOT APPLICABLE SINCE THE INVESTMENT HAS BEEN RECORDED IN THE BOOKS OF ACCOUNT. SECTION 69B IS ALSO NOT APPLICABLE. AS PER THE A.O. THE ASSESSEE HAS SHOWN EXCESS INVESTME NT IN THE BOOKS OF ACCOUNT. THEREFORE, AS PER CONDITION PRESCRIBED UNDER SECTIO N 142A(1) READ WITH SECTION 69 AND 69B OF THE ACT, THE REFERENCE ITSELF IS AN INVA LID REFERENCE. THIS VIEW IS FORTIFIED BY THE ORDER OF THE I.T.A.T., JODHPUR BEN CH IN THE CASE OF SMT. SARASWATI DEVI GEHLOT VS. ITO, 111 TTJ 408. UNDER THE CIRCUMS TANCES, ALL ACTION TAKEN BY THE A.O. REQUIRES QUASHING. 21. IN THE LIGHT OF ABOVE DISCUSSION, WE ARE OF THE VIEW THAT THE A.O. HAS WRONGLY INVOKED SECTION 13 OF THE ACT AND HAS WRONG LY WITHDRAWN BENEFIT OF SECTION 11 READ WITH SECTION 12 OF THE ACT. ORDERS OF AUTHORITIES BELOW ARE SET ASIDE AND QUASHED. ALL ADDITIONS ARE DELETED. BEN EFITS UNDER SECTION 11 AND 12 ARE 27 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 ALLOWED. THEREFORE, THE APPEALS FILED BY THE ASSES SEE FOR ASSESSMENT YEARS 2006- 07, 2007-08 & 2008-09 ARE ALLOWED. 22. THE REVENUE HAS ALSO FILED APPEAL, A.Y. 2008-09, IT A NO. 150/AGRA/2012 23. THE GROUNDS RAISED BY THE REVENUE IN ITS APPEA L ARE AS UNDER :- 1) WHETHER UNDER THE FACTS AND CIRCUMSTANCES IN TH E CASE THE LD. CIT(A) IS CORRECT IN DELETING THE ADDITION OF RS.76 ,91,076/- ON ACCOUNT OF CAPITAL EXPENDITURE MADE BY AO TREATING THE ASSE SSEE IN NORMAL COMMERCIAL MANNER, IGNORING THE FACT THAT LD. CIT ( APPEALS) HIMSELF DENIED THE EXEMPTION U/S 11 & 12 OF THE ACT TO THE ASSESSEE AS PER SECTION 13C OF THE IT ACT, 1961. 2) APPELLANT CRAVE LEAVE TO AMEND, ALTER ADD, OR MO DIFY ANY GROUND OR GROUNDS OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF CASE. 24. THE BRIEF FACTS OF THE CASE ARE THAT THE A.O., WHILE MAKING ASSESSMENT, MADE ADDITION OF RS.76,91,076/- ON ACCOUNT OF CAPITAL EX PENDITURE BECAUSE THE A.O. HAS TAKEN THE BASIS AND FACTS OF TOTAL AS PER SURPLUS S HOWN IN INCOME AND EXPENDITURE. THE SURPLUS SHOWN IN INCOME AND EXPENDITURE WAS TAK EN AS NORMAL INCOME WITHOUT ALLOWING BENEFIT UNDER SECTION 11 & 12 OF THE ACT. AS REGARDS WITHDRAWAL OF BENEFITS UNDER SECTION 11/12, THE CIT(A) UPHELD THE ACTION OF THE A.O. HOWEVER, THE ADDITION MADE ON ACCOUNT OF CAPITAL EXPENDITURE OF RS.76,91,076/- WAS DELETED. 28 ITA NOS.198, 199/AGRA/2011, 150 & 156/AGRA/2012 A.YS. 2006-07 TO 2008-09 THEREFORE, THE ASSESSEE AND REVENUE BOTH ARE IN APP EAL. THE APPEAL OF THE ASSESSEE AFTER DETAILED DISCUSSIONS VIDE PARAGRAPH NOS.12 TO 21 ABOVE WHEREIN WE HAVE ALLOWED THE APPEALS OF THE ASSESSEE HOLDING THAT TH E ASSESSEE IS ENTITLED TO BENEFITS OF SECTION 11 AND 12 OF THE ACT. IN THE LIGHT OF T HE FACTS, THIS GROUND OF REVENUE HAS NO SUBSTANCE AND, THEREFORE, APPEAL OF THE REVE NUE IS DISMISSED. 25. IN THE RESULT, ALL THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED AND APPEAL FILED BY THE REVENUE IS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, AGRA BENCH, AGRA 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY