ACIT, Trichy V. M/s. Rural Education and Action Development (READ), Perambalur

ITA 1808/CHNY/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95910 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2015
• Appeal Filed By: Department
• Bench Allotted: A
• Next Hearing Date: 29-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 07-10-2013
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: A S SRIRAMAN
• Section: 11

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER & SHRI V. DURGA RAO, JUDICIAL MEM BER ./ I.T.A.NO. 1 808 /MDS/2013 / ASSESSMENT YEAR : 200 9 - 1 0 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I(2), TRICHY . VS. M/S. RURAL EDUCATION AND ACTION DEVELOPMENT (READ), 8/58, SAKTHI VINAYAGAR SREET, VILANDAI ANDIMADAM, PERAMBALUR DT. 621 801. [PAN: AA A TR2818R ] ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI P .RADHAKRISHNAN , J CIT / RESPONDENT BY : SHRI A.S. SRIRAMAN , ADVOCATE / DATE OF HEARING : 2 9 . 0 6 .201 5 / DATE OF P RONOUNCEMENT : 19 . 0 8 .201 5 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER : TH I S APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) , TIRUCHIRAPALLI , DATED 26 . 0 6 .20 1 3 RELEVANT TO THE ASSESSMENT YEAR 20 0 9 - 1 0 . 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE TRUST IS AN NGO DOING SOCIAL SERVICE ACTIVITIES FOR DISABLED, HIV/AIDS INFECTED PEOPLE, MR CHILDREN AND WOMEN. THE SOCIETY IS ALSO DOING MICROFINANCE ON A SMALL SCALE WHICH IS I.T.A. NO . 1 808 /M/ 1 3 2 CARRIED OUT ON COMMISSION BASIS THROUGH HDFC AND NDFS, TRICHY. THE ASSESSEE SOCIETY HAS CONSTRUCTED A BUILDING THROUGH A CONTRACTOR MRS. S. AMMU BY EXECUTING AN AGREEMENT AND TOTAL PAYMENT TO THE EXTENT OF .35,00,000/ - WERE PAID TO MRS. S. AMMU, WIFE OF SHRI D. SELVAM, SECRETARY OF THE ASSESSEE SOCIETY FOR CONSTRUCTION OF THE BUILDING OF THE ASSESSEE SOCIETY. THE ASSESSING OFFICER CAME TO A CONCLUSION THAT THE ASSESSEE SOCIETY HAS VIOLATED PROVISIONS OF SEC TION 13(1)(C)(II) OF THE INCOME TAX ACT AND DENIED EXEMPTION UNDER SECTION 11 OF THE ACT. 3. ON APPEAL, IT WAS SUBMITTED BEFORE THE LD. CIT(A) THAT THE WIFE OF SECRETARY OF THE ASSESSEE SOCIETY IS AN INDEPENDENT PERSON AND ALSO A REGISTERED CONTRACTOR AN D THEREFORE, THE CONSTRUCTION OF THE BUILDING IS NOTHING TO DO WITH THE SECRETARY OF THE ASSESSEE SOCIETY. IT WAS ALSO SUBMITTED THAT THE WORK WAS ALLOTTED TO MRS. S. AMMU AFTER CALLING 3 QUOTATIONS FROM REGISTERED CONTRACTORS AND THE LOWEST RATE AMONG THE M WAS MRS. AMMU AND THEREFORE, THE CONTRACT WAS AWARDED. THE LD. CIT(A), BY CONSIDERING THE DETAILS FILED BEFORE HIM WITH REGARD TO CALLING OF 3 QUOTATIONS, ALLOWED THE CLAIM OF THE ASSESSEE. 4. ON APPEAL, THE REVENUE HAS RAISED AN OBJECTION WITH REGARD TO VIOLATION OF RULE 46A ON THE GROUND THAT THE ASSESSEE HAS NOT FILED ANY DETAILS BEFORE THE ASSESSING OFFICER IN RESPECT OF 3 QUOTATIONS CALLED FROM I.T.A. NO . 1 808 /M/ 1 3 3 THREE DIFFERENT PARTIES. THEREFORE, THE LD. DR HAS SUBMITTED THAT THIS ISSUE HAS TO GO BACK TO THE ASSES SING OFFICER FOR VERIFICATION. 5. ON THE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE HAS NO OBJECTION FOR REMITTING THE ISSUE BACK TO THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH . 6. WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS ON RECORD AND G ONE THROUGH THE ORDERS OF AUTHORITIES BELOW. WE FIND FROM THE ORDER OF THE LD. CIT(A) THAT T HE LD. CIT(A) BY CONSIDERING THE DETAILS FILED IN RESPECT OF QUOTATIONS RECEIVED FROM THE CONTRACTORS AND THE CLAIM OF THE ASSESSEE WAS ALLOWED. IT APPEARS THAT THE SE FACTS WITH REGARD TO THE ABOVE CONTRACTORS ARE NOT FILED BEFORE THE ASSESSING OFFICER. WE ALSO FIND THAT THE LD. CIT(A), WITHOUT CALLING REMAND REPORT FROM THE ASSESSING OFFICER, SIMPLY ACCEPTED THE DETAILS FILED BY THE ASSESSEE AND ALLOWED THE CLAIM OF THE ASSESSEE. THEREFORE, IT IS A CLEAR VIOLATION OF RULE 46A AND THE ISSUE HAS TO GO BACK TO THE ASSESSING OFFICER FOR VERIFICATION OF THE DETAILS IN RESPECT OF TENDERS CALLED F ROM 3 CONTRACTORS. IN VIEW OF THE ABOVE, IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER PASSED BY THE LD. CIT(A) AND DIRECT THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER CONSIDERING ALL THE DETAILS AS MAY BE FILED BY THE ASSESSEE. I.T.A. NO . 1 808 /M/ 1 3 4 7. SO FAR AS OTHER ISSUES ARE CONCERNED, FOR THE SAKE OF CONVENIENCE AND TO REACH FINALITY OF ALL THE ISSUES, WE DIRECT THE ASSESSING OFFICER TO DECIDE OTHER ISSUES ALSO AFRESH IN ACCORDANCE WITH LAW. 8 . IN THE RESULT, THE APPEAL OF THE REV ENUE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED ON WEDNESDAY, THE 19 TH O F AUGUST , 2015 AT CHENNAI. SD/ - SD/ - ( CHANDRA POOJARI ) ACCOUNTANT MEMBER ( V. DURGA RAO ) JUDICIAL MEMBER CHENNAI, DATED, THE 19 . 0 8 .201 5 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.