Shetkari Shikshan Mandal, Budhgaon V. ITO, Ward 1(1), Sangli, Sangli

ITA 1694/PUN/2007

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 49744 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 29-04-2011
• Assessment Year: 1999-2000
• Appeal Filed On: 17-12-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRI
• Keywords: Charitable institution; Earning of tax free income
• Section: 143(3); 10B; 148; 11

Judgement Text

\ IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDIC IAL MEMBER AND SHRI D KARUNAKARA RAO, ACCOUNTANT MEMBER I.T.A. NO. 1694/PN/07 (ASSTT. YEARS: 1999-2000) SHETKARI SHIKSHAN MANDAL .. APPELLAN T C/O PVPIT, BUDHGAON, TAL. MIRAJ, SANGLI PAN AAATS 6456G VS. INCOME-TAX OFFICER, .. RESPONDENT WD 1(1) SANGLI APPELLANT BY: SHRI M K KULKARNI RESPONDENT BY: SHRI PANKAJ GARG ORDER PER SHAILENDRA KUMAR YADAV, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS), KOLHAPUR DATE D 19.10.2007 WHICH, IN TURN, HAS ARISEN FROM ORDER OF THE ASSESSING OFFICE R PASSED UNDER SECTION 143(3) R.W.S. 147 OF THE INCOME-TAX ACT, 1961 (IN SHORT T HE ACT), PERTAINING TO THE ASSESSMENT YEAR 1999-2000. 2. THE DISPUTE RAISED IN THIS APPEAL IS THAT THE CI T(A) WAS NOT JUSTIFIED IN DISMISSING THE APPEAL OF THE ASSESSEE, EDUCATIONAL INSTITUTION/TRUST AND CONFIRMING THE ORDER OF THE AO WHICH HAD AN EFFECT OF TAXING THE EXEMPT INCOME U/S 10(23C)(VI) OF THE ACT. ITA NO 1694/PN/07 SHETKARI SHIKSHAN MANDAL, SANGLI 2 3. THE ASSESSEE IS A CHARITABLE TRUST INVOLVED PURE LY IN EDUCATIONAL ACTIVITIES AND IS EXEMPT U/S 10(23C) OF THE ACT. IT IS MENTION ED IN THE ASSESSMENT ORDER THAT THE SURPLUS IN THE ACCOUNTS OF THE TRUST WAS R S 5,28,861/- IN AY 1999-2000 AND RS 8,19,616/- IN AY 2002-03. ACCORDING TO THE A O, AS PER SEC. 12A(B) THE ASSESSEE WAS REQUIRED TO GET ITS ACCOUNTS AUDITED A ND ENCLOSE THE AUDIT REPORT INFORM NO. 10B WITH THE ORIGINAL RETURN FOR CLAIMIN G EXEMPTION U/S 11 & 12. THE ASSESSEE FAILED TO DO SO. IN RESPONSE TO NOTICE U/S 148 ISSUED BY THE AO, THE ASSESSEE SUBMITTED RETURN DECLARING INCOME AT NIL A CCOMPANIED BY THE AUDIT REPORT INFORM NO. 10B. AS PER THE AO, HOWEVER, THE CONDITION OF FILING THE AUDIT REPORT WITH THE ORIGINAL RETURN WAS NOT SATISFIED. THE AO ACCORDINGLY HELD THAT THE CLAIM OF DEDUCTION U/S 10(22) MADE BY THE ASSESSEE WAS NOT MAINTAINABLE, SINCE THE AUDIT REPORT WAS NOT A PART OF THE ORIGINAL RET URN. 4. IN APPEAL, THE CIT(A) HELD AS UNDER: I HAVE CONSIDERED THE SUBMISSIONS. TE APPELLANTS CLAIM FOR EXEMPTION U/S 10(22) FOR AY 1999-2000 IS MISPLACED. SECTION 1 0(22) HAS BEEN OMITTED BY THE FINANCE ACT 1998 WITH EFFECT FROM 1. 4.99.THUS THIS SECTION WILL NOT BE APPLICABLE FOR AY 1999-2000. THE APPELL ANT HAS ALTERNATIVELY CLAIMED EXEMPTION U/S 10(23C)(VI). THIS CLAUSE READ S AS UNDER: ANY UNIVERSITY OR EDUCATIONAL INSTITUTION EXISTING SOLELY FOR EDUCATIONAL PURPOSES AND NOT FOR PURPOSES OF PROFIT , OTHER THAN THOSE MENTIONED IN SUB-CLAUSE (IIIAB) OR SUB-CAUSE (IIAB) AND WHICH MAYBE APPROVED Y THE PRESCRIBED AUTHORITY THE APPELLANT HAS NOT OBTAINED THE APPROVAL OF THE PRESCRIBED AUTHORITY WHICH IS THE CHIEF COMMISSIONER OR THE DIRECTOR GEN ERAL OF INCOME-TAX. IT IS SIMPLY STATED THAT AN APPLICATION HAS BEEN MADE IN FORM NO. 56D UNDER RULE 2CA.THEAPPROVAL OF THE PRESCRIBED AUTHORITY HA S NOT YET BEEN RECEIVED. THE APPELLANTS CASE THEREFORE CANNOT BE TREATED AS EXEMPT UNDER THE PROVISIONS OF SECTION 10(23C) SINCE THE B ASIC CONDITION LAID DOWN IN THE PROVISION IS NOT FULFILLED. THE CLAIM O F THE APPELLANT FOR EXEMPTION FOR THE RELEVANT ASSESSMENT YEAR IS REJEC TED. AGGRIEVED BY THE SAID ORDER OF THE CIT(A), THE ASS ESSEE IS IN APPEAL BEFORE US. WE HAVE HEARD RIVAL SUBMISSIONS AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON RECORD. AFTER CONSIDERING THE SUBMISSI ONS OF BOTH THE SIDES, WE FIND THAT THE MATTER NEEDS DEEP PROBE. SO IN THE INTERES T OF JUSTICE, WE RESTORE THE ITA NO 1694/PN/07 SHETKARI SHIKSHAN MANDAL, SANGLI 3 MATTER TO AO WITH DIRECTION TO DECIDE THE SAME AS P ER FACT AND LAW AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO ASSESSEE. WE ORDER AC CORDINGLY. 5. IN THE RESULT, THE APPEAL IS ALLOWED FOR STATIST ICAL PURPOSES. DECISION PRONOUNCED IN THE OPEN COURT ON THIS 29 TH DAY OF APRIL, 2011. SD/- SD/- (D. KARUNAKARA RAO) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE: DATED: 29 TH APRIL, 2011 B COPY OF THE ORDER FORWARDED TO : 1. SHETKARI SHIKSHAN MANDAL, SANGLI 2. ITO WD 1(1) SANGLI 3. THE CIT(A) KOLHAPUR 4. THE CIT I KOLHAPUR 5. THE D.R, B BENCH, PUNE TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, PUNE BENCHES, PUNE