Sree Ramkrishna Satyananda Ashram , Kolkata V. ITO, Ward - 1(3), Exemption, , Kolkata

ITA 2114/KOL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 1350 (ITAT-KOLKATA)
• Duration Of Justice: 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Appeal Filed On: 08-10-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Charitable institution; Set aside
• Section: 11; 12A; 10B; 143(1); 139(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH (A), KOLKATA [BEFORE SHRI P.M. JAGTAP, VICE PRESIDENT & SHRI A. T. VARKEY, JM] I.T.A. NO. 2114/KOL/2018 ASSESSMENT YEAR: 2016-17 SREE RAMKRISHNA SATYANANDA ASHRAM....................................APPELLANT 48/1, DESHBANDHU ROAD (W), KOLKATA 700 035. [PAN: AABTS 7973 H] ITO, WARD 1(3), EXEMPTION KOLKATA....................RESPONDENT 10B, MIDDLETON ROW, KOLKATA. APPEARANCES BY: SHRI MAHADEB GHOSH & SHRI K.N. KUNDU, ADVOCATE APPEARING ON BEHALF OF THE ASSESSEE. SHRI A.K. NAYAK, CIT, DR APPEARING ON BEHALF OF THE REVENUE. DATE OF CONCLUDING THE HEARING : JANUARY 17, 2019 DATE OF PRONOUNCING THE ORDER : MARCH 15, 2019 ORDER PER P.M. JAGTAP, VICE PRESIDENT THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) 25, KOLKATA DATED 30.08.2018 AND THE SOLITARY ISSUE INVOLVED THEREIN RELATES TO THE DISALLOWANCE OF ASSESSEES CLAIM FOR EXEMPTION OF RS. 8,50,14,948/- U/S 11 FOR THE ALLEGED FAILURE OF THE ASSESSEE TO FILE ALONG WITH THE RETURN OF INCOME AN AUDIT REPORT IN THE PRESCRIBED FORM NO. 10B. 2. THE ASSESSEE IN THE PRESENT CASE IS A CHARITABLE TRUST WHICH IS DULY REGISTERED WITH THE REGISTER OF SOCIETIES AS WELL AS U/S 12A OF THE INCOME TAX ACT, 1961. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY IT ON 31.03.2017 DECLARING A TOTAL INCOME AT NIL AFTER CLAIMING EXEMPTION U/S 11(1) OF THE ACT AMOUNTING TO RS. 8,50,14,948/-. THE SAID RETURN FILED BY THE ASSESSEE WAS PROCESSED 2 SREE RAMKRISHNA SATYANANDA ASHRAM I.T.A. NO.2114/KOL/2018 ASSESSMENT YEAR: 2016-17 U/S 143(1) AND IN THE INTIMATION ISSUED U/S 143(1) DATED 17.03.2018, THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S 11(1) WAS DISALLOWED BY THE AO APPARENTLY DUE TO NON-SUBMISSION OF AUDIT REPORT IN THE PRESCRIBED FORM NO. 10B AS REQUIRED BY SECTION 12A(B) OF THE ACT BEFORE THE DUE DATE OF FURNISHING THE RETURN OF INCOME U/S 139(1) OF THE ACT. 3. AGAINST THE INTIMATION ISSUED BY THE AO U/S 143(1), AN APPEAL WAS PREFERRED BY THE ASSESSEE BEFORE THE LD. CIT(A). IT WAS SUBMITTED ON BEHALF OF THE ASSESSEE BEFORE THE LD. CIT(A) THAT ITS CLAIM FOR EXEMPTION U/S 11 WAS ALLOWED BY THE AO IN THE EARLIER YEARS WHILE PROCESSING THE RETURNS U/S 143(1) IN SPITE OF NON-FILING OF FORM 10B U/S 12A(B) OF THE ACT. IT WAS SUBMITTED THAT THE AUDIT REPORT IN FORM NO. 10B WAS OBTAINED BY THE ASSESSEE ON 30.03.2017 AND THE AO WAS NOT JUSTIFIED IN DISALLOWING THE CLAIM OF THE ASSESSEE FOR EXEMPTION U/S 11 WHILE PROCESSING THE RETURN OF INCOME U/S 143(1) WITHOUT GIVING THE ASSESSEE AN OPPORTUNITY TO FILE THE SAID REPORT. THIS STAND OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE LD. CIT(A). ACCORDING TO HIM, THE ASSESSEE AS PER SECTION 12A(1)(B) WAS REQUIRED TO FURNISH ALONG WITH THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION THE AUDIT REPORT IN THE PRESCRIBED FORM NO. 10B AND SINCE THERE WAS FAILURE ON THE PART OF THE ASSESSEE TO COMPLY WITH THE SAID REQUIREMENT, ITS CLAIM FOR EXEMPTION U/S 11 WAS RIGHTLY DISALLOWED BY THE AO WHILE PROCESSING THE RETURN U/S 143(1) OF THE ACT. HE ACCORDINGLY CONFIRMED THE DISALLOWANCE MADE BY THE AO ON ACCOUNT OF ASSESSEES CLAIM FOR EXEMPTION U/S 11 IN THE INTIMATION ISSUED U/S 143(1) OF THE ACT AND DISMISSED THE APPEAL OF THE ASSESSEE. AGGRIEVED 3 SREE RAMKRISHNA SATYANANDA ASHRAM I.T.A. NO.2114/KOL/2018 ASSESSMENT YEAR: 2016-17 BY THE ORDER OF THE LD. CIT(A), THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN THE CASE OF CIT VS HARDEODAS AGARWALLA TRUST 198 ITR 511 CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE, IT WAS HELD BY THE HONBLE KOLKATA HIGH COURT THAT THE REQUIREMENT OF FILING THE AUDIT REPORT IN THE PRESCRIBED FORM NO. 10B U/S 12A IS ONLY DECLARATORY AND NOT MANDATORY. IT WAS HELD THAT THE SAID PROVISION IS A PROCEDURAL ONE WHICH SHOULD NOT BE CONSTRUED AS MANDATORY. IT WAS HELD THAT IF THE AUDIT REPORT IN THE FORM NO. 10B WAS NOT FILED BY THE ASSESSEE ALONG WITH THE RETURN OF INCOME, THE RETURN BECAME DEFECTIVE AND THE ASSESSING OFFICER WAS REQUIRED TO GIVE AN OPPORTUNITY TO THE ASSESSEE TO SUBMIT THE AUDIT REPORT. RELYING ON THE SAID DECISION OF HONBLE KOLKATA HIGH COURT IN THE CASE OF HARDEODAS AGARWALLA TRUST (SUPRA), THE LEARNED COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT THE IMPUGNED ORDER OF THE LD. CIT(A) AS WELL AS INTIMATION ISSUED BY THE AO U/S 143(1) ARE LIABLE TO BE SET ASIDE AND THE MATTER SHOULD BE SENT BACK TO THE AO FOR GIVING THE ASSESSEE AN OPPORTUNITY TO SUBMIT THE AUDIT REPORT IN FORM NO. 10B WHICH WAS ALREADY AVAILABLE WITH THE ASSESSEE. WE FIND MERIT IN THIS CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE AND SINCE THE LEARNED DR HAS ALSO NOT RAISED ANY OBJECTION FOR SENDING THE MATTER BACK TO THE AO FOR GIVING THE ASSESSEE AN OPPORTUNITY TO SUBMIT THE AUDIT REPORT IN FORM NO. 10B, WE SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE AO FOR DECIDING THE ISSUE RELATING THE CLAIM OF THE ASSESSEE EXEMPTION U/S 11 AFTER GIVING 4 SREE RAMKRISHNA SATYANANDA ASHRAM I.T.A. NO.2114/KOL/2018 ASSESSMENT YEAR: 2016-17 THE ASSESSEE AN OPPORTUNITY TO SUBMIT THE REQUIRED AUDIT REPORT IN THE PRESCRIBED FORM NO. 10B. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TREATED AS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH MARCH, 2019. SD/- SD/- (A. T. VARKEY) (P.M. JAGTAP) JUDICIAL MEMBER VICE PRESIDENT DATED: 15/03/2019 BISWAJIT, SR. PS COPY OF ORDER FORWARDED TO: 1. SREE RAMKRISHNA SATYANANDA ASHRAM, 48/1, DESHBANDHU ROAD (W), KOLKATA 700 035. 2. ITO, WARD 1(3), EXEMPTION, KOLKATA. 3. THE CIT(A) 4. THE CIT 5. DR TRUE COPY, BY ORDER, ASSISTANT REGISTRAR / H.O.O. ITAT, KOLKATA