D.L. Ashish Foundation Trust, Ahmedabad V. The ITO, (Exemptions) Ward-1, Ahmedabad

ITA 188/AHD/2022

AI Insights

The case involves D.L. Ashish Foundation Trust, which appealed against the orders of the Commissioner of Income Tax (Appeals) confirming the AO's decisions for the Assessment Years 2011-12 and 2014-15. The primary contention was the non-participation of the trust in the assessment and appellate proceedings due to serious personal disturbances faced by the main trustee. The Tribunal considered an affidavit detailing the trustee's personal challenges, including marital discord and legal issues, which hindered their ability to attend to tax matters. The Tribunal noted that similar circumstances had previously led to a remand in a related case for the Assessment Year 2013-14, where the AO had subsequently allowed the trust's claims. Based on these precedents and the circumstances described in the affidavit, the Tribunal decided to remand the cases back to the AO for a fresh assessment.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 133468 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 04-10-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 18-05-2022
• Other Referred Cases: ITA No.1016/Ahd/2018
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 11

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठअहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठ ‘A’ अहमदाबाद। अहमदाबाद।अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD BEFORE SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI T.R.SENTHIL KUMAR, JUDICIAL MEMBER ITA No.188 and 189/AHD/2022 Assessment Year :2011-12 and 2014-15 D.L. Ashish Foundation Trust 203, Rajvi Tower Rajvansh Flats Judges Bungalows Road Bodakdev, Ahmedabad. PAN : AAATD 3625 Q Vs. ITO, Ward-1 (Exemption) Ahmedabad. अपीलाथ / (Appellant) यथ /(Respondent) Assessee by : Shri Deepak Shah, AR Revenue by : Ms. Saumya Pandey Jain, Sr.DR स ु नवाई क तार ख/Date of Hearing : 05/10/2023 घोषणा क तार ख /Date of Pronouncement: 06/10/2023 आदेश/O R D E R PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER These are two appeals by the assessee against the orders passed by the ld.Commissioner of Income Tax(Appeals)-9, Ahmedabad [hereinafter referred to as “Ld.CIT(A)”] under section 250(6) of the Income Tax Act, 1961 ("the Act" for short) dated 18.12.2015 and 26.8.2019 pertaining to the Asst.Year 2011-12 and 2014-15 respectively. 2. The limited prayer of the assessee in both the appeals was restoring the appeals back to the AO, since the assessee was unable to participate in assessment as well as appellate proceedings on ITA No.188 and 189/Ahd/2022 2 account of serious disturbance in the personal life of the main trustee of the assessee trust. For the sake of convenience, therefore, we dispose of both the appeals of the assessee by this consolidated order. 2. The grounds raised in the respective appeals by the assessee are as under: Asstt.Year 2011-12 i) The ld.CIT(A) erred in law and in the facts of the case in confirming the order of the AO in disallowing exemption u/s.11 and 12 of the Act. ii) The Ld. CIT (A) erred in law and in the facts of the case in confirming the order of the AO in treating entire tuition fees of Rs.1,27,57,189/- as income and not allowing any expenses there against. iii) The Ld. CIT (A) erred in law and in the facts of the case in confirming the order of the AO in making addition of Rs. 21,33;989/- being addition on fixed asset (car) though it was neither income nor claimed as an expense during the year. iv) The Ld. CIT (A) erred in law and in the facts of the case in not considering the evidences placed before it. v) The Ld. CIT (A) erred in law and in the facts of the case in not condoning the delay in filing the appeal before it. vi) The Ld. CIT (A) erred in law and in the facts of the case in not serving any notice of hearing to the appellant. Asstt.Year 2014-15 i) The ld.CIT(A) erred in law and in the facts of the case in confirming the order of the AO in disallowing exemption u/s.11 of the Act. ITA No.188 and 189/Ahd/2022 3 ii) The Ld. CIT (A) erred in law and in the facts of the case in enhancing disallowance to Rs. 16,96,380/-. iii) The Ld. CIT (A) erred in law and in the facts of the case in enhancing disallowance to Rs. 16,96,380/- without issuing notice to the appellant. iv) The Ld. CIT (A) erred in law and in the facts of the case in not serving any notice of hearing to the appellant. v) The Ld. CIT (A] erred in law and in the facts of the case in rejecting exemption u/s 11 on the entire income even though the violation of S. 13(l)(c) calls for addition/disallowance of only the amount earned/spent in violation of S.13(l)(c) of the Act. 3. During the course of hearing before us it was brought to our notice that the assessee has filed an affidavit dated 14.4.2023 sworn by the Shri Jatin Jani on behalf of the assessee-Trust. The main plank of the pleadings made in the affidavit was that the impugned additions were made ex parte on the ground of non-attendance and non-compliance of the assessee at the time of assessment proceedings as well as appellate proceedings. The reasons for non- compliance before both the authorities were given in the affidavit, which for the clarity we reproduced below: “2. I submit that I was going through marital discord since the beginning of the year 2016 due to which not only my personal life, but my business was shattered too. I was physically attacked by my wife's family, for which an FIR was filed by me. A copy of the FIR is annexed hereto. Owing to this reason, I was not able to concentrate on the multiple income tax .proceedings against me and the appellant trust for various assessment years. Because of these incidents, I am not residing at the address mentioned in the assessment order/CIT order and this is the reason why notices sent to the appellant trust are not being complied with. After various legal hurdles, I finally got a divorce decree from the Hon’ble High Court of Gujarat on 21-12-2022 (copy of the order attached). However now I have regained myself after psychological help from friends and am willing to co-operate with every legal proceeding pending against me and the appellant trust. 3. I submit that in a case for A.Y. 2013-14, the CIT(A) had passed an ex-parte order and the Hon'ble ITAT was pleased to remit the case to the AO for the similar reason mentioned above. Before the AO, all ITA No.188 and 189/Ahd/2022 4 the evidences were provided and the claim was allowed. A copy of the said order of the ITAT and the AO are attached herewith.” 4. The ld.counsel for the assessee before us submitted that in identical facts and circumstances the assesses appeal for A.Y 2013- 14 had also come up before the Tribunal who vide order dated 29.12.2020 in ITA No.1016/Ahd/2018 had remanded the issue back to the file of the AO for reconsideration. He stated that during that set aside proceedings before the AO, the assessee did attend the proceedings, and filed all the materials evidences to support its case, and based on those materials, the AO allowed the claim of the assessee. The ld.counsel filed a copy of above order of the Tribunal and the assessment order so passed consequent upon order of the Tribunal before us, which are taken on record. He, thus prayed that the reasons narrated in the affidavit are bona fide and non- presence of the assessee in both the proceedings before the Revenue authorities was due to reasons beyond control of the assessee, and therefore, both orders of the Revenue authorities passed for the impugned assessment years, may be set aside back to the AO for reconsideration. On the other hand, the ld.DR objected to the contentions of the assessee. He contended that the assessee was given several opportunities before both the Revenue authorities, and even in the remand proceedings before the ld.CIT(A) the assessee did not appear and comply with the requisite. Therefore, the impugned orders of the Revenue authorities are justifiable which do not require any interference by the Tribunal. 5. We have considered submissions of both the sides. We have also gone through orders of the Revenue authorities, and also ITA No.188 and 189/Ahd/2022 5 affidavit filed by the assessee in this behalf. From the affidavit, as well as material placed before us, we find, the assessee had genuine and legitimate reasons for its non-attendance during the assessment proceedings as well as before the first appellate authority. During this period, the trustee of the assessee trust had significant family problems/challenges resulting in mental stress and agony. Added to this, the assessee was also involved in various legal proceedings both personally and on behalf of the assessee-trust. Consequently, the assessee was unable to devote much time and attention to address income tax matters pending before the Revenue authorities. 6. We also find that in Asst.Year 2013-14 where identical set facts and circumstances, the ITAT finding merit in the contentions of the assessee, restored the issue back to the AO for reconsideration. Subsequently, the AO examined the assessee’s claim finding it in order, and accordingly, he granted exemption to the assessee-trust. The copy of the order of the assessment order for Asst.Year 2013-14 is placed before us. Therefore, the agonizing circumstances outlined in the affidavit, due to which, the assessee could not attend the proceedings both before the ld.AO and the CIT(A), we believe that the assessee deserves to be shown leniency. Thus, we set aside both the impugned orders of the AO and the ld.CIT(A) for the Asst.Year 2011- 12 and 2014-15, and remand issues back to the file of AO for reconsideration. We do so. We direct the AO to provide fair opportunity of hearing to the assessee during the set aside assessment proceedings. We also direct the assessee to appear before AO as and when the date of hearing is fixed and to provide all necessary evidence and ITA No.188 and 189/Ahd/2022 6 information without any unjustified delay. The assessee is also advised not to seek adjournment without any valid reason. 7. In the result, both the appeals of the assessee are allowed for statistical purpose. Order pronounced in the Court on 6 th October, 2023 at Ahmedabad. Sd/- Sd/- (T.R. SENTHIL KUMAR) JUDICIAL MEMBER (ANNAPURNA GUPTA) ACCOUNTANT MEMBER Ahmedabad,dated 06/10/2023