DCIT, C-2, Chandigarh V. M/s H.H. Dalai Lama Central Tibetan Relief Committee, Dharamshala

ITA 1541/CHANDI/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4531 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 07-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH GUPTA
• Assessee Lawyers: SANJEEV SINGH
• Keywords: Charitable institution; Difference of opinion; Change of opinion
• Section: 143(3); 12A; 147; 148; 12; 11

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, A, CHANDIGARH , . '.., # $, %& BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND DR. B.R.R. KUMAR, ACCOUNTANT MEMBER ./ ITA NO. 1541/CHD/2017 / ASSESSMENT YEAR : 2010-11 THE DCIT, CIRCLE 2 (EXEMPTIONS) CHANDIGARH M/S H.H. DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA H.P. ./PAN NO: AAATH0700J / APPELLANT /RESPONDENT ! /ASSESSEE BY : SH. SANJEEV SINGH, ADVOCATE ' ! / REVENUE BY : SH. ASHISH GUPTA, CIT DR # $ % /DATE OF HEARING : 06.05.2019 &'() % / DATE OF PRONOUNCEMENT : 30.05.2019 %'/ ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER DATED 31.08.2017 OF THE COMMISSIONER OF INCOME TAX( APPEALS), PALAMPUR [HEREINAFTER REFERRED TO AS CIT(A)]. 2. IN THIS APPEAL, THE REVENUE HAS AGITATED THE ACT ION OF THE CIT(A) IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER OF 6,79,11,022/- IN THE ASSESSMENT ITA NO. 1541/CHD/2017- H.H.D DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA 2 CARRIED OUT U/S 143(3) READ WITH SECTION 147 OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') ON THE GROUND THAT THE ASSESSEE HAD NOT GIVEN SPECIFIC PURPOSE FOR WHICH THE AFORESAID AMOUNT WAS ACCUMULATED U/S 11(2 ) OF THE ACT. 3. THE ASSESSEE IS A CHARITABLE ORGANIZATION REGIST ERED U/S 12 / 12A OF THE INCOME TAX ACT. THE ASSESSEE, THEREFORE, CLAIMED EX EMPTION U/S 11 OF THE ACT IN RESPECT OF INCOME EARNED DURING THE YEAR. THE ASSES SMENT WAS ACCORDINGLY COMPLETED BY THE ASSESSING OFFICER U/S 143(3) OF TH E ACT ON 21.1.2013 AT NIL INCOME. HOWEVER, SUBSEQUENTLY THE ASSESSING OFFICER NOTICED FROM THE RECORD THAT THE PURPOSE OF ACCUMULATION WAS SHOWN AS 'RELIEF PROGRAM, RURAL DEVELOPMENT, ENVIRONMENT PROGRAM. VOCATIONAL TRAINI NG PROGRAM. MISC. INCOME GRANTING PROGRAM. AGRICULTURE ACTIVITIES, AN IMAL HUSBANDRY PROGRAM AND RUNNING EXPENSES'. THE ASSESSING OFFICER HELD T HAT BENEFIT OF ACCUMULATION WAS SOUGHT FOR OBJECTS / PURPOSES WHIC H WERE NOT SPECIFIC AND THE PURPOSES OF ACCUMULATION NARRATED WERE SIMPLY T HE AIMS AND OBJECTS OF THE TRUST. HE HELD THAT THERE SHOULD BE SPECIFIC PU RPOSES FOR ACCUMULATION. THAT MERE REPETITION OF THE OBJECTS OF THE TRUST WO ULD NOT MEET THE REQUIREMENT OF SECTION 11(2) OF THE ACT. HE, ACCORD INGLY REOPENED THE ASSESSMENT INVOKING THE PROVISIONS OF SECTION 147 / 148 OF THE ACT AND DENIED THE BENEFIT OF ACCUMULATION U/S 11(2) OF THE ACT TO THE ASSESSEE AND ASSESSED THE INCOME OF THE ASSESSEE AT 6,73,13,022/-. ITA NO. 1541/CHD/2017- H.H.D DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA 3 4. BEING AGGRIEVED BY THE ABOVE ORDER OF THE ASSESS ING OFFICER, THE ASSESSEE PREFERRED APPEAL BEFORE THE LD. CIT(A). 5. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE DELETED THE ADDITION SO MADE BY THE ASSESSING OFFICER OBSER VING AS UNDER:- I HAVE CONSIDERED THE FACTS OF THE CASE AND WRITT EN SUBMISSION OF THE APPELLANT. ORIGINAL ASSESSMENT U/S 143(3) WAS MADE AT NIL INCOME BY ITO, DHARAMSHALA. SUBSEQUENTLY, THE ASSESSMENT WAS RE-OPENED U/S 147 / 148 BY RECORDING REASONS TO THE EFFECT THAT T HE NOTICE OF ACCUMULATION U/S 11(2) OF THE ACT GIVEN BY THE APPE LLANT WAS NOT SPECIFIC, I.E., NO SPECIFIC PURPOSES FOR WHICH THE ACCUMULATION WAS MADE WERE MENTIONED AND ONLY THE GENERAL OBJECTS OF THE TRUST HAD BEEN REITERATED IN THE SAID NOTICE U/S 11 (2) OF TH E ACT. DURING APPEAL, THE APPELLANT FILED COPY OF TH E ORIGINAL ASSESSMENT ORDER U/S 143(3) DATED24.01.2013 AND ARG UED WITH REFERENCE TO PARA-3 OF THE ASSESSMENT ORDER THAT LD . A.O. HAD CALLED FOR AND EXAMINED THE DETAILS / DOCUMENTS IN RESPECT OF THE RECEIPTS DURING THE YEAR, THE EXPENDITURE MADE TOWA RDS CHARITABLE PURPOSES, THE BALANCE AMOUNT SET APART DURING THE EARLIER YEARS AND THE AMOUNTS ACCUMULATED BEING SPENT IN SUCCEEDING YEARS ETC. AS MENTIONED IN PARA-4 OF THE ORIGINAL ASSESSMENT ORDER U/S 143(3), THE ASSESSEE DULY SUBM ITTED ACCUMULATION CHART OF THE LAST FIVE YEARS ALONGWITH FORM NO. 10. THE RETURNED INCOME WAS ACCEPTED ONLY AFTER LD. A.O. WA S SATISFIED WITH THE ABOVE DETAILS. HENCE, THERE WAS NO VALID GROUND FOR INITIATING PROCEEDINGS U/S 148 OF THE ACT WHEN THE ASSESSMENT PROCEEDINGS U/S 143(3) STOOD DULY COMPLETED. NO NEW INFORMATION HAD COME INTO THE POSSESSION OF LD. A.O. ON THE BASIS OF WHICH PROCEE DINGS U/S 147 / 148 COULD HAVE BEEN INITIATED. HAVING COMPLETED THE ORI GINAL ASSESSMENT UNDER SECTION 143(3) AFTER DUE VERIFICATION OF THE ACCUMULATION MADE UNDER SECTION 1 1(2) OF THE ACT, LD. AO WAS NOT JUS TIFIED TO REOPEN THE COMPLETED ASSESSMENT ON THE GROUND THAT THE NOTICE FOR ACCUMULATION DID NOT MENTION ANY SPECIFIC PURPOSES. I HAVE CONSIDERED THE ABOVE FACTS OF THE CASE. A PE RUSAL OF FORM NO- 10 DATED 27.09.2010, A COPY OF WHICH WAS FURNISHED DURING APPEAL, ITA NO. 1541/CHD/2017- H.H.D DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA 4 SHOWS THAT THE ACCUMULATION OF RS. 6,78,50,000/- HA S BEEN MADE FOR THE FOLLOWING PURPOSES : RELIEF PROGRAM, RURAL DEVELOPMENT, ENVIRONMENTAL PROGRAM, VOCATIONAL TRAINING PROGRAM, MICRO INCOME GENERATING PROGRAM, AGRICULTURAL ACTIVITIES. ANIMAL HUSBANDRY PROGRAM AND RUNNING EXPENSES. IT IS SEEN THAT SCHEDULE-1 ANNEXED WITH THE RETURN OF INCOME DULY GIVES DETAILS OF AMOUNTS ACCUMULATED / SET APART WI THIN THE MEANING OF SECTION 11(2) IN THE LAST 11 YEARS UNDER THE SAME V ERY HEADS. THE AMOUNTS APPLIED OUT OF THE ABOVE DURING DIFFERENT Y EARS HAVE ALSO BEEN SPECIFICALLY MENTIONED. THE ABOVE HEADS MENTIO NED IN THE NOTICE OF ACCUMULATION ARE NOT GENERAL HEADS BUT SPECIFIC HEADS UNDER WHICH FUNDS PENDING UTILIZATION ARE SHOWN AND FOREIGN CON TRIBUTIONS ARE BEING SPECIFICALLY REPORTED UNDER THE FCRA (FOREIGN CONTRIBUTION REGULATION ACT) BY THE APPELLANT. THE DETAILED BREA KUP OF RS. 6,78,50,000/- MENTIONED IN THE NOTICE OF ACCUMULATI ON U/S 1 1(2) OF THE ACT IS AS UNDER:- PARTICULARS OPENING BALANCE RECEIPT DURING THE VEAR UTILIZED DURING T HE VEAR CLOSING BALANCE TOTAL RECEIPT SET APART LEDGER HEAD FC ACCOUNT LOCAL ACCOUNT FC ACCOUNT LOCAL ACCOUNT FC ACCOUNT LOCAL ACCOUNT FC ACCOUNT LOCAL ACCOUNT ENCASHMENT 720629. 50 - 120750 - 620,750 - 220629. 50 120,750 HOUSING RENOVATION & CONSTRUCTION PROGRAM 2593408. 85 15000. 00 2578408. 85 MICRO INCOME GENERATING PROGRAM 26684628. 24 183916. 74 160985 81 .54 1748717 1.12 25296 0 3 8.66 183916.74 1609858 1.54 157345 89.86 OLD PEOPLE ALLOWANCE 4973554. 14 297402. 00 1686450. 00 3584506.14 297402. 00 OTHER MISCELLANEOUS 10175644. 04 5037624. 72 11907407 .00 22835.85 1188295 9.60 I020009 1.44 5060460.57 1193024 2.85 489617 9.05 PRIVATE OFFICE GRANT FOR POOR ELDERLY PEOPLE (CONS OPH) 9191792.21 1099847. 50 8674629. 40 1431600. 00 6514067 80 1417200. 00 1135235 3.81 1114247.50 1010622 9.40 RELIEF PROGRAM 3221199.34 176851. 08 14760273 .62 62982.00 1001711 9.00 49811.00 7964353- 96 190022.08 1482325 5.62 692131. 29 AGRICULTURE ACTIVITIES 12367116. 46 38091701 . .19 3688763 9.26 1357117 8.39 3809170 1.19 125216 59.89 OFFICE AND STAFF QU CONSTRUCTION 7459984. 00 78.000. 00 7381984.00 7459984. 00 ANIMAL HUSBANDRY PROGRAM 9367273.25 1 116%80 .80 1361098 9.48 6925964. 57 1116968 0.80 247119 4.18 ITA NO. 1541/CHD/2017- H.H.D DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA 5 ENVIRONMENTAL PROGRAM 3305668.20 4140160. 29 3379591. 22 40 66237. 27 4140160. 29 398377 2.27 GRANT OF STIPEND/SCHOLARS HIP/ASSISTANCE 8240032.10 34119810 .26 28112074 0.34 1433910 2.02 3411981 0.26 RURAL DEVELOPMENT 50332270. 05 44611121 .00 3214815 9.28 6279523 1.77 4461112 1.00 193237 16.53 VOCATIONS 1 TRAINING (YOUTH EMPOWERMENT SUPPORT! 7.482521.00 9475065. 10 7402756. 00 9554830. 10 9475065. 10 822675 6.93 GRAND TOTAL 140368144. .89 1478583 2.53 19304843 0.20 9395553. 85 1673511 93.10 3 867 2 1 1 .00 1660653 81. 99 20314175. 38 2024439 84.05 678500 00.00 SINCE THE DONORS HAD GIVEN FUNDS FOR SPECIFIC OBJEC TS, THE FUNDS REMAINING UNUTILIZED TO THE TUNE OF RS. 6,78.50,.00 0/- WERE ACCUMULATED U/S 11(2) UNDER SPECIFIC HEADS AS MENTI ONED IN THE APPELLANT'S WRITTEN SUBMISSION ABOVE. IN VIEW OF THE ABOVE FACTS, IT IS HELD THAT LD. A.O . WAS NOT JUSTIFIED TO HOLD THAT THE NOTICE OF ACCUMULATION U/S 11(2) HAS NOT BEEN GIVEN FOR SPECIFIC OBJECTIVES / PURPOSES AND TO NOT GIVE CRED IT FOR THE SAME. THE AMOUNT ACCUMULATED AS ABOVE HAS BEEN UTILIZED IN TH E SUCCEEDING ASSESSMENT YEARS UNDER THE SAME HEADS AS UNDER : A.Y. 2011-12 RS. 3,7,50,000/- A.Y. 2012-13 RS. 3,21,00,000/- SINCE ALL THE ABOVE DETAILS WERE ALREADY AVAILABLE IN THE ITR / AUDITED ACCOUNTS/ REPLIES OF THE APPELLANT FILED DURING THE ORIGINAL ASSESSMENT PROCEEDINGS AND HAD BEEN DULY EXAMINED AS MENTIONED IN PARAS 3 & 4 OF THE ORIGINAL ASSESSMENT ORDER, INITIATION OF PRO CEEDINGS U/S 147/ 148 WAS NOT JUSTIFIED. GROUNDS OF APPEAL 1 & 2 ARE ALLOWED. 6. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND HAV E ALSO GONE THROUGH THE RECORD. A PERUSAL OF THE ABOVE REPRODUCED FINDINGS OF THE CIT(A) REVEALS THAT THE LD. CIT(A) HAS GIVEN CATEGORICAL FINDING THAT THE D ETAILED BREAK UP OF 6,78,50,000/- MENTIONED IN THE NOTICE OF ACCUMULATI ON U/S 11(2) OF THE ACT WERE DULY FURNISHED BEFORE THE ASSESSING OFFICER WHICH H AVE BEEN REPRODUCED ALSO IN THE IMPUGNED ORDER IN THE SHAPE OF CHART AS REPRODU CED ABOVE. THERE WAS NO FRESH ITA NO. 1541/CHD/2017- H.H.D DALAI LAMA CENTRAL TIBETAN RELIEF COMMITTEE, DHARMSHALA 6 INFORMATION TO THE ASSESSING OFFICER THAT THE INCOM E OF THE ASSESSEE HAS ESCAPED ASSESSMENT. THE ASSESSING OFFICER HAS FORMED THE OP INION REGARDING THE ESCAPEMENT OF INCOME AFTER RE-APPRECIATION OF THE F ACTS ON RECORD WHICH WAS NOTHING BUT JUST CHANGE OF OPINION. MOREOVER, THE AMOUNT SO ACCUMULATED HAS BEEN SPENT IN THE SUBSEQUENT YEARS WHICH HAVE ALSO BEEN ACCEPTED IN THE ASSESSMENT PROCEEDINGS OF THE SUBSEQUENT YEARS. IN VIEW OF THIS, IT CANNOT BE SAID THAT THE INCOME OF THE ASSESSEE HAD ESCAPED ASSESSM ENT. WE THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) AND TH E SAME IS UPHELD. THERE IS NO MERIT IN THE APPEAL OF THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30.05.2019 SD/- SD/- ( ' . . , # $ / B.R.R. KUMAR) %& / ACCOUNTANT MEMBER ( / SANJAY GARG ) / JUDICIAL MEMBER DATED : 30. 05.2019 .. '+ ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. # / / CIT 4. # / ( )/ THE CIT(A) 5. -01 2 , % 2 , 34516 / DR, ITAT, CHANDIGARH 6. 15 7$ / GUARD FILE '+ # / BY ORDER, 8 ' / ASSISTANT REGISTRAR