The A.C.I.T./ D.C.I.T., Central Circle, Agra V. Gayatri Shiksha Samitti, Agra

ITA 214/AGR/2011

• Counselvise Citation: 21420314 RSA 2011
• Duration Of Justice: 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-04-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 08-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K SHARMA
• Assessee Lawyers: VITHAL DAS
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NO. 214/AGRA/2011 ASSTT. YEAR :2006-07 DCIT, CENTRAL CIRCLE, VS. GAYATRI SHIKSHA SAMITI, AGRA. 14/195, GHATIA AZAM KHAN, AGRA.(PAN:AAAAC 1565 D) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI A.K. SHARMA, JR. D.R. RESPONDENT BY : SHRI VITHAL DAS, ADVOCATE DATE OF HEARING : 03.04.2012 DATE OF PRONOUNCEMENT OF ORDER : 13.04.2012 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-II, AGRA DATED 22.02.2011 FOR THE ASSESSMENT YEAR 2006- 07 ON THE FOLLOWING GROUNDS : 1. THAT THE CIT(A) ERRED IN LAW IN DELETING THE AD DITION OF RS.2,44,383/- ON ACCOUNT OF INCOME FROM PLYING OF T WO BUSES WHICH WERE NOT RECORDED IN THE BOOKS OF ACCOUNT. 2. THAT THE CIT(A) ERRED IN LAW AND ON FACTS IN DE LETING THE ADDITION OF RS.18,38,145/- ON A WRONG APPLICATION O F FACTS AND LAW WHEN IT IS CLEAR FROM THE FACTS OF THE CASE THAT TH IS A.O.P. WAS CARRYING OUT ACTIVITIES OTHER THAN EDUCATION ACTIVI TIES WITH A PROFIT MOTIVE. ITA NO. 214/AGRA/2011 2 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT AS PER T HE AO, THE ASSESSEE WAS PLYING TWO BUSES DURING THE YEAR AND EXPENSES ON RE PAIRS AND MAINTENANCE OF BUSES HAVE BEEN CLAIMED AT RS.3,85,023/-. IT WAS FU RTHER NOTED THAT NO RECEIPTS FOR THE BUS OPERATION HAVE BEEN SHOWN. THE AO FURTH ER OBSERVED THAT THE ASSESSEE HAS CLAIMED DEPRECIATION OF RS.90,594/-. S UPPOSING THAT AT LEAST 100 STUDENTS WERE USING SERVICE OF EACH BUS AND RS.300/ - WERE BEING CHARGED FROM EACH CHILD, THE GROSS RECEIPTS FROM THE BUS OPERATI ON WOULD BE RS.7,20,000/-. NO BOOKS OF ACCOUNT/BILLS HAVE BEEN KEPT AND MAINTA INED IN RESPECT OF INCOMING AND OUTGOING OF BUSES. THEREFORE, AFTER DE DUCTING EXPENSES ETC., THE NET PROFIT FROM THE BUSES WERE WORKED OUT TO RS.2,4 4,383/- AND ADDITION WAS ACCORDINGLY MADE. IT WAS SUBMITTED BEFORE THE LD. C IT(A) THAT NO EVIDENCE HAS BEEN BROUGHT ON RECORD BY THE AO TO JUSTIFY THIS AD DITION. THE PROVISION OF TRANSPORTATION OF STUDENTS TO AND FRO FROM THE SCHO OL IS INCORPORATED IN THE TOTAL SUM OF SCHOOL FEES. THE SCHOOL BUSES ARE RUN BY SAM ITI ON ITS OWN ACCOUNT AND EXPENDITURES HAVE BEEN CLAIMED ACCORDINGLY. IT WAS FURTHER SUBMITTED THAT ADDITION IS MADE TO DISALLOW THE DEDUCTION U/S. 10( 23C)(IIIED). THE AO COULD NOT DENY THE EXEMPTION UNDER THE ABOVE PROVISIONS A S PER ORDER OF THE LD. CIT(A). THE LD. CIT(A) CONSIDERING THE ABOVE FACTS FOUND THAT THE AO HAS NOT BROUGHT ANY MATERIAL FOR THE PURPOSE OF MAKING ADDI TION. THE CONTENTION OF THE ITA NO. 214/AGRA/2011 3 ASSESSEE WAS FOUND CORRECT THAT THE BUS CHARGES WER E EMBEDDED IN THE FEES CHARGED FROM THE STUDENTS. THEREFORE, THE ADDITION WAS DELETED. 3. FURTHER, THE AO MADE ADDITION OF RS.18,38,145/-. THE AO OBSERVED THAT SINCE SALE VALUE OF DIARIES, TIES AND BELTS ETC. WE RE WORKED OUT TO RS.3,32,600/- AND HELD THAT THIS RECEIPT WILL BE REDUCED FROM THE GROSS RECEIPTS SHOWN BY THE ASSESSEE AND NET WAS WORKED OUT TO RS.91,90,725/- A ND BY APPLYING THE PROFIT RATE OF 20% IN THE CASES OF EDUCATIONAL INSTITUTION S, THE PROFIT WAS ACCORDINGLY WORKED OUT. IT WAS SUBMITTED BEFORE THE LD. CIT(A) THAT THE ASSESSEE IS RUNNING AN EDUCATIONAL INSTITUTION AND IS REGISTERED UNDER THE SOCIETIES ACT AND QUALIFIES FOR DEDUCTION U/S. 10(23C) OF THE IT ACT. THE AGGRE GATE RECEIPTS OF THE ASSESSEE ARE LESS THAN RS.1,00,00,000/-. IT WAS ALSO SUBMITT ED THAT IN EARLIER YEARS, THE ASSESSEE HAS BEEN GRANTED BENEFIT OF SECTION 10(23) (C) OF THE ACT AS PER ORDERS OF THE LD. CIT(A). IT WAS FURTHER SUBMITTED THAT SA LARY HAS BEEN PAID TO THE EMPLOYEES AS PER THE DECISION OF THE EXECUTIVE COMM ITTEE. THE LD. CIT(A) FOUND THAT ESTIMATE OF PROFIT HAS BEEN SHOWN ON ADH OC BASIS WITHOUT POINTING OUT ANY DISCREPANCY IN THE BOOKS OF ACCOUNT MAINTAI NED BY THE SOCIETY. NOTHING IS POINTED OUT IF ANY SALARY HAS BEEN PAID WHICH DI D NOT COMMENSURATE WITH THE QUALIFICATION AND EXPERIENCE. THE ADDITION WAS ACCO RDINGLY DELETED. ITA NO. 214/AGRA/2011 4 4. THE LD. DR RELIED UPON THE ORDER OF THE AO. ON T HE OTHER HAND, THE LD. COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND ALSO REFERRED TO ORDER DATED 24.11.2011 O F ITAT, AGRA BENCH IN THE CASE OF SAME ASSESSEE IN IT(SS)A NOS. 6, 7, 8 & 9/A GRA/2010 FOR A.YRS. 2002- 03, 2001-02, 2000-01 & 1999-2000, IN WHICH THE DEPA RTMENTAL APPEALS HAVE BEEN DISMISSED AND THE EXEMPTION GRANTED BY THE LD. CIT(A) U/S. 10(23C) OF THE IT ACT WAS CONFIRMED. 5. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE DO NOT FIND ANY MERIT IN THE DEPARTMENTAL APPEAL. THE ASSESSEE SPECIFICALLY PLEA DED THAT THE TRANSPORTATION FEES IS PART OF THE SCHOOL FEES CHARGED FOR THE STU DENTS AND THAT THE ADDITION WAS MADE PURELY ON ADHOC BASIS. SIMILARLY, FOR ESTIMATE OF THE NET PROFIT, THE AO HAS NOT MADE OUT ANY CASE OF REJECTION OF BOOKS OF ACCO UNT AND NO SPECIFIC DISCREPANCY HAS BEEN NOTED IN THE MAINTENANCE OF BO OKS OF ACCOUNT. IN EARLIER YEARS, THE ASSESSEE HAS BEEN GRANTED BENEFIT OF EXE MPTION U/S. 10(23C) OF THE IT ACT AND ALL THE DEPARTMENTAL APPEALS HAVE BEEN DISM ISSED BY THE TRIBUNAL IN THE CASE OF THE ASSESSEE VIDE ORDER DATED 24.11.2011 (S UPRA). SINCE THE ASSESSEE RUNS EDUCATIONAL INSTITUTION AND NOTHING SPECIFIC I S POINTED OUT AGAINST THE ASSESSEE, THEREFORE, THE LD. CIT(A) ON PROPER APPRE CIATION OF FACTS AND MATERIAL ON RECORD RIGHTLY ALLOWED THE APPEAL OF THE ASSESSE E. IN THE RESULT, THERE IS NO ITA NO. 214/AGRA/2011 5 MERIT IN THE DEPARTMENTAL APPEALS ON BOTH THE GROUN DS. THE SAME IS ACCORDINGLY DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (A.L. GEHLOT) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, AGRA 6. GUARD FILE ASSISTANT REGISTRAR TRUE COPY