ITO (EXEMPTIONS) WARD 3, CHENNAI V. M/S M DURAI EDUCATIONAL TRUST, TIRUVANNAMALAI

ITA 1822/CHNY/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 7237 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 28-05-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: M KARUNAKARAN
• Keywords: Charitable institution
• Section: 12A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . !, # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.1822/CHNY/2018 & '& / ASSESSMENT YEAR : 2011-12 THE INCOME TAX OFFICER, (EXEMPTIONS), WARD 3, CHENNAI - 600 034. V. M/S M. DURAI EDUCATIONAL TRUST, NO.1, M.D. THOTTAM, PILLAIYAR KOIL STREET, MELMARUVATHUR ROAD, SEENAVARAM, VANDAVASI, TIRUVANNAMALAI 604408. PAN : AABTM 9570 C ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SHRI AR.V. SREENIVASAN, JCIT +,)* - . / RESPONDENT BY : SHRI M. KARUNAKARAN, ADVOCATE / - 0# / DATE OF HEARING : 08.01.2019 12' - 0# / DATE OF PRONOUNCEMENT : 11.01.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -17, CHENN AI, DATED 23.03.2018 AND PERTAINS TO ASSESSMENT YEAR 2011-12. 2 I.T.A. NO.1822/CHNY/18 2. SHRI AR.V. SREENIVASAN, THE LD. DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE IS A RE GISTERED CHARITABLE INSTITUTION UNDER SECTION 12A OF THE INC OME-TAX ACT, 1961 (IN SHORT 'THE ACT'). ACCORDING TO THE LD. D.R., T HE ASSESSING OFFICER FOUND THAT THE ASSESSEE RECEIVED 4,91,77,875/- FOR THE PERIOD FROM 01.04.2000 TO 31.03.2011, WHICH INCLUDES A SUM OF 1 CRORE FROM SHRI M. DURAI, ONE OF THE TRUSTEES. HOWEVER, ACCOR DING TO THE LD. D.R., IN THE RETURN OF INCOME FILED BY THE SAID TRU STEE SHRI M. DURAI, THE PAYMENT OF 1 CRORE TO THE ASSESSEE-TRUST WAS NOT DISCLOSED. ACCORDING TO THE LD. D.R., THERE IS NO ENTRY EITHER IN THE BOOKS OF ACCOUNT OR IN THE BANK STATEMENT WITH REGARD TO PAY MENT OF 1 CRORE TO THE ASSESSEE BY THE TRUSTEE SHRI M. DURAI. THEREFORE, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER MA DE AN ADDITION OF 1 CRORE BY TREATING THE SAME AS ANONYMOUS DONATION. HOWEVER, THE CIT(APPEALS) FOUND THAT THE TRUSTEE SHRI M. DUR AI RECEIVED LOAN FROM VARIOUS PERSONS WHO ARE KNOWN TO HIM PERSONALL Y. EVEN THOUGH THE ASSESSEE CLAIMED BEFORE THE CIT(APPEALS) THAT A LIST OF PERSONS FROM WHOM SHRI M. DURAI RECEIVED LOAN WAS F URNISHED BEFORE THE ASSESSING OFFICER, NO SUCH DETAILS WERE FURNISHED BEFORE THE ASSESSING OFFICER. MOREOVER, ACCORDING TO THE LD. D.R., IN THE 3 I.T.A. NO.1822/CHNY/18 INCOME-TAX RETURN OF SHRI M. DURAI, THE RECEIPT OF LOAN FROM VARIOUS PERSONS AS CLAIMED BY THE ASSESSING OFFICER WAS NOT DISCLOSED. IN THOSE CIRCUMSTANCES, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) IS NOT JUSTIFIED IN ALLOWING THE CLAIM OF THE ASSESSEE . 3. ON THE CONTRARY, SHRI M. KARUNAKARAN, THE LD.COU NSEL FOR THE ASSESSEE, SUBMITTED THAT IN FACT, SHRI M. DURAI, ON E OF THE TRUSTEES, RECEIVED LOAN FROM VARIOUS PERSONS KNOWN TO HIM AND GAVE THE SAID LOAN TO THE ASSESSEE-TRUST. ACCORDING TO THE LD. C OUNSEL, THIS FACT WAS PLACED BEFORE THE AUTHORITIES BELOW. EVEN THOU GH THE ASSESSING OFFICER WAS NOT CONVINCED, THE CIT(APPEAL S) ALLOWED THE CLAIM OF THE ASSESSEE. ACCORDING TO THE LD. COUNSE L, IF THERE IS ANY DOUBT ABOUT THE RECEIPT OF LOAN BY SHRI M. DURAI FR OM VARIOUS PERSONS KNOWN TO HIM, THE MATTER MAY BE SENT BACK T O THE ASSESSING OFFICER FOR VERIFICATION. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THAT ONE OF TH E TRUSTEES SHRI M. DURAI RECEIVED LOAN FROM DIFFERENT PERSONS AND T HE SAID LOAN WAS AGAIN LENT TO THE ASSESSEE-TRUST. EVEN THOUGH THE ASSESSEE CLAIMS 4 I.T.A. NO.1822/CHNY/18 THAT A LIST OF PERSONS ALONG WITH CONFIRMATION LETT ERS IN RESPECT OF THE RECEIPT OF LOAN WAS FURNISHED BEFORE THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDING, NOW THE REVENU E CLAIMS THAT SUCH DETAILS WERE NOT AVAILABLE BEFORE THE ASSESSIN G OFFICER. THEREFORE, THE FACT NEEDS TO BE CLARIFIED. MOREOVE R, WHEN THE ASSESSEE CLAIMS THAT A LIST OF PERSONS FROM WHOM SH RI M. DURAI RECEIVED LOAN WAS FILED BEFORE THE ASSESSING OFFICE R, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, ORDERS OF B OTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ISSUE OF RECEIPT OF LOA N BY THE ASSESSEE TO THE EXTENT OF 1 CRORE IS REMITTED BACK TO THE FILE OF THE ASSESSI NG OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE TH E MATTER IN THE LIGHT OF THE MATERIAL THAT MAY BE FILED BY THE ASSE SSEE AND THEREAFTER DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW, AFT ER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S ALLOWED FOR STATISTICAL PURPOSES. 5 I.T.A. NO.1822/CHNY/18 ORDER PRONOUNCED IN THE COURT ON 11 TH JANUARY, 2019 AT CHENNAI. SD/- SD/- (. ! ) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 11 TH JANUARY, 2019. KRI. - +056 76'0 /COPY TO: 1. )*/ APPELLANT 2. +,)*/ RESPONDENT 3. / 80 () /CIT(A)-17, CHENNAI-34 4. CIT (EXEMPTIONS), CHENNAI 5. 69 +0 /DR 6. :& ; /GF.