I.T.O., Guna V. M/s Lal Chand Shanti Public Shiksha Samiti, Guna

ITA 302/AGR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1953 (ITAT-AGRA)
• Duration Of Justice: 1 year(s) 9 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 07-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BELU SINHA
• Assessee Lawyers: AMIT SOGANI
• Section: 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, SMC AGRA BEFORE SH RI J.S. REDDY , ACCOUNTANT MEMBER ITA NO. 302 / AG RA /201 4 ASSESSMENT YEAR : 20 10 - 11 INCOME TAX OFFICER, VS. LAL CHAND SHANTI PUBLIC SHIKSHA SAMITI CANTT ROAD SHANTI VILLA, HEAD PO ST OFFICE ROAD GUNA (M.P.) JAGDISH COLONY, GUNA (M.P. (PAN: AAAAL2063 K ) . (APPELLANT) (RESPONDENT) A PPELLANT BY : SMT. BELU SINHA, SR. D.R. RE SPONDENT BY : S HRI AMIT SOGANI, ADVOCATE DATE OF HEARING : 0 5 .07 . 201 6 DATE OF PRONOUNCEMENT : 08 . 07.201 6 ORDER THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LEARNED CIT(A) , GWALIOR DATED 25.07.2014 FOR THE A SSESSMENT YEAR 20 10 - 11, ON THE FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANC ES OF THE CASE, THE LD. CIT ( A ) WAS RIGHT IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.3,00 , 000/ - MADE BY THE AO IN THE HANDS OF THE ASSESS E E ON ACCOUNT OF DISALLOWANCE OF SALARY PAID TO TARUN WADHWA AND VIDUSHI WADHWA. 2. ON THE FACTS AND IN THE CIR CUMSTANCES OF THE CASE, THE LD . CIT ( A ) WAS RIGHT IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.3,87,348/ - MADE BY THE AO IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF DISALLOWANCE OF BUILDING RENT EXPENSES. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE, THE LD . CIT ( A ) WAS RIGHT IN LAW AND ON F ACTS IN DELETING THE ADDITION OF RS.4,62,581/ - MADE BY THE ITA NO. 302 /AGRA/201 4 A.Y. 20 10 - 11 2 AO IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF DISALLOWANCE OF BUILDING REPAIR AND MAINTENANCE EXPENSES. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD . CIT ( A ) WAS RIGHT IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.28,14,170/ - MADE BY THE AO IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF DONATIONS RECEIVED. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD . CIT ( A ) WAS RIGHT IN LAW AND ON FACTS IN HOLDING THAT THE ASSESSEE WAS ELIGIBLE FOR EXEMPTION UNDER SECTION 10(23)( C ) (IIIAD) OF THE INCOME TAX ACT, 1961. 2. W E HAVE HEARD THE RIVAL CONTENTIONS. O N A CARE F UL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND ON A PERUSAL OF THE PAPERS ON RECORD AND ORDERS OF THE AUTHORITIES BELOW, I HOLD AS FOLLOWS : - 3. GROUND NO.1 PERTAINS TO DISALLOWANCE OF SALARY PAID TO SHRI TARUN WADHWA, PRINCIPLE AND VIDUSHI WADHWA, VICE PRINCIPLE OF THE SCHOOL OF RS.1,8 0 ,000/ - P.A. AND R S.1,20,000/ - P.A. RESPECTIVELY. THIS HAS BEEN DISALLOWED BY INVOKING SECTION 40A(2)(B) OF THE ACT BY THE ASSESSING OFFICER. THE LEARNED C IT(A) DELETED THE SAME. I AM OF THE OPINION THAT THE SALARIES PAID ARE LESS THAN COMMENSURATE WITH THE SERVICES REND ERED BY PRINCIPLE AND V ICE PRINCIPLE OF THE SOCIETY. STATUTORY DEDUCTION S HAS BEEN MADE ON THESE AMOUNTS AND HENCE IN MY VIEW THE AMOUNT IS RIGHTLY DELETED BY TH E LEANED CIT(A). 4. GROUND NO.2 IS AGAINST DELETION OF ADDITION OF BUILDING RENT PAID BY THE A SSESSEE. HERE ALSO I FIND NO INFIRMITY IN THE ACTIONS OF THE LEARNED CIT(A) IN DELETING THE ADDITION . AS RIGHTLY POINTED OUT THAT THE ASSESSING OFFICER HAS WRONGLY UNDERSTOOD THE INCREASE IN RENT AND MADE DISALLOWANCE. THE RENT VARIED AS THE AREA ITA NO. 302 /AGRA/201 4 A.Y. 20 10 - 11 3 TAKEN ON RENT HAD ALSO VARIED. THE ASSESSEE HAS FILED A CHART GIVING THE AREA PROVIDED/CONSTRUCTED FOR THE A.Y. 2007 - 08. THUS, AS THE RENT PAID CANNOT BE SAID TO BE EXCESSIVE OR UNREASONABLE, IN MY VIEW THE SAME IS RIGHTLY DELETED BY THE LEARNED CIT(A). 5. SI MILARLY , GROUND NO.3 IS AGAINST DELETION OF ADDITION OF RS.4,62,581/ - BEING BUILDING MAINTENANCE EXPENSES. HERE ALSO IT IS DEMONSTRATED THAT THESE EXPENSES WERE INCURRED FOR APPROACH ROAD TO CLASS ROOM, PRINCIPAL ROOM ETC. AS THIS IS A RENTED BUILDING AND EXPENDITURE H AS BEEN INCURRED ON THE RENTED BUILDING, THE SAME CANNOT BE DISALLOWED. THUS, I UPHOLD THIS FINDING OF THE LEARNE D C IT(A) . 6. GROUND NO.4 IS AGAINST DELETION OF ADDITION OF RS.28,14,170/ - ON ACCOUNT OF DONATIONS RECEIVED. LEARNED CIT(A) RECORDED THAT THE ASSESSEE SOCIETY HAS COLLECTED RECEIPTS WITH DIFFERENT NOMENCLATURES, ADMISSION FEES, TUITION FEES, SPORTS FEES, PRACTICAL FEES, CULTURAL FEES ETC. THE AGGREGATE OF ANNUAL RECEIPT IS RS.35,48,070/ - . THIS IS LESS THAN RS. 1 CRORE. AS S ECTION 10(23)(C)(IIIAD) DOES NOT SPECIFY THE HEAD OF RECEIPT, LEARNED C IT(A) HELD THAT THE ASSESSING OFFICER WAS WRONG IN DENYING EXEMPTION TO THE ASSESSEE UNDER SECTION 10(23)(C) OF THE ACT . I FIND NO INFIRMITY IN THIS FINDING OF THE LD. CIT(A). THE ARG UMENT OF THE LEARNED DEPARTMENTAL R E PRESENTATIVE THAT ONLY FEE RECEIPTS SHOULD BE COUNTED FOR THE PURPOSE OF COMPUTING ITA NO. 302 /AGRA/201 4 A.Y. 20 10 - 11 4 TURNOVER OF RS.1 CRORE IS NOT SUPPORTED BY THE LANGUAGE OF THE SECTION. THUS, THIS GROUND OF THE REVENUE IS DISMISSED. 7. IN ANY EVENT , WHEN THE INCOME OF THE ASSESSEE IS HELD TO BE EXEMPT UNDER SECTION 10(23)(C)(IIIAD) , THERE CANNOT BE ANY DISALLOWANCE BY INVOKING PROVISIONS THAT ARE APPLICABLE TO SECTIONS 11 , 12 AND 13 OF THE A C T . 8. IN MY VIEW , THE LD . CIT(A) HAS RIGHTLY RELIED UPON T HE DECISION OF THE LUCKNOW B ENCH OF ITAT IN THE CASE OF ITO VS. VIRENDRA SINGH MEMORIAL SHIKSHA SAMITI (2009) 121 TTJ (LUCKNOW) 829. 9 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 8 TH JULY, 2016. SD/ - (J.S. REDDY) ACCOUNTANT MEMBER DATE: 8 TH JU LY , 201 6 PBN/* COPY OF THE ORDER FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, AGRA BENCH, AGRA 6. GUARD FILE. BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA