SMT DAKUBEN SAREMALJI SANCHETI NADOL CHARITABLE TRUST, MUMBAI V. NATIONAL FACELESS APPEAL CENTRE (NFAC), DELHI, MUMBAI

ITA 3202/MUM/2022

AI Insights

The case involves the Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust, which appealed against the order of the Commissioner of Income-tax (Appeals) - National Faceless Appeal Centre, Delhi. The primary contention was the ex-parte order passed by the CIT(A) without adequate opportunity for the trust to be heard, and the subsequent upholding of a prima facie adjustment of Rs.1,20,11,455 under section 143(1) of the Income Tax Act, 1961. The trust argued that the additions were contrary to the evidence on record and that the intimation issued was void ab initio based on a Supreme Court decision. The tribunal noted the technical issues faced by the trust in complying with the notices during the COVID pandemic and decided to remand the case for a fresh hearing.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 123322 (ITAT-MUMBAI)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2023
• Appeal Filed By: Assessee
• Order Result: PartlyAllowed
• Bench Allotted: D
• Next Hearing Date: 22-05-2023
• Assessment Year: 2020-2021
• Appeal Filed On: 19-12-2022
• Other Referred Cases: cognizance for extension of limitation, In re. 432 ITR 206 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Charitable institution
• Section: 10B; 143(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “D” MUMBAI BEFORE SHRI ABY T VARKEY (JUDICIAL MEMBER) AND SHRI OM PRAKASH KANT (ACCOUNTANT MEMBER) ITA No. 3202 /MUM/2022 Assessment Year: 2020-21 Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust, C/o G.P. Mehta & Co. CAS, 807, Tulsiani Chambers, Nariman Point, Mumbai-400021. Vs. National Faceless Appeal Centre (NFAC), 6 th floor, Aayakar Bhavan, M.K. Road, Mumbai-400020. PAN No. AAATD 7192 E Appellant Respondent Assessee by : Mr. G.P. Mehta Revenue by : Mr. P.D. Chougule (Addl. CIT) Date of Hearing : 23/05/2023 Date of pronouncement : 31/05/2023 ORDER PER OM PRAKASH KANT, AM This appeal by the assessee is directed against order dated 09.11.2022 passed by the Ld. Commissioner of Income-tax (Appeals) – National Faceless Appeal Centre, Delhi [in short ‘the Ld. CIT(A)’] for assessment year 2020-21. The grounds raised by the assessee are reproduced as under: 1. The orders passed by the Ld. Lower authorities are bad in law and bad in facts. 2. The Ld. CIT(A) have grossly erred in passing ex order without giving adequate & reasonable opportunity of being heard. 3. The Ld. CIT(A) has grossly erred in holding that appellant did not comply with the notices issued & he has further erred in passing the appellate order ex parte. 4. The Ld. Lower authorities have grossly erred in making an addition of Rs.1,20,11,455/ adjustment u/s 143(1) of the I.T. assigned for impugned addition are wrong & contrary to the evidence on record. 5. The intimation issued and upheld by the Ld. CIT(A) is void ab initio in view of decision of the Hon’ble Court in the case of cognizance for extension of limitation, In re. 432 ITR 206 (SC) 6. Having regard to the facts of the case, the provisions of law & judicial propositions, impugned additions are wholly untenable in law. 2. Briefly stated facts of charitable trust and filed its return of income for the year under consideration on 27.03.2021, as against extended due date up to 15.02.2021, the relevant forms prescribed under the Income Tax Rules i.e. Form No. 10B in Form 10 in relation to accumulation of income were also not filed by the assessee before the due date of the filing of the return of income. Therefore, while processing the return of income u/s 143(1) of the Income Central Processing Centre (CPC) computed income of Rs.1,20,11,455/- taxable without giving any benefit of the application of the income to the extent of 15% of the income accumulated or said part for specific purposes u/s 11(2) of the Act. Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust The orders passed by the Ld. Lower authorities are bad in law and bad in facts. The Ld. CIT(A) have grossly erred in passing ex order without giving adequate & reasonable opportunity of being heard. The Ld. CIT(A) has grossly erred in holding that appellant did not comply with the notices issued & he has further erred in passing the appellate order ex The Ld. Lower authorities have grossly erred in making an addition of Rs.1,20,11,455/- by way of prima facie adjustment u/s 143(1) of the I.T. Act, 1961. Reasons assigned for impugned addition are wrong & contrary to the evidence on record. The intimation issued and upheld by the Ld. CIT(A) is void ab initio in view of decision of the Hon’ble Court in the case of cognizance for extension of limitation, In re. 432 ITR 206 (SC) Having regard to the facts of the case, the provisions of law & judicial propositions, impugned additions are wholly untenable in law. Briefly stated facts of the case are that the assessee is a public charitable trust and filed its return of income for the year under consideration on 27.03.2021, as against extended due date up to 15.02.2021, the relevant forms prescribed under the Income Tax . 10B in Form 10 in relation to accumulation of income were also not filed by the assessee before the due date of the filing of the return of income. Therefore, while processing the return of income u/s 143(1) of the Income-tax Act, 1961 (in short ‘the Act Central Processing Centre (CPC) computed income of taxable without giving any benefit of the application of the income to the extent of 15% of the income accumulated or said part for specific purposes u/s 11(2) of the Act. Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust 2 ITA No. 3202/M/2022 The orders passed by the Ld. Lower authorities are bad The Ld. CIT(A) have grossly erred in passing ex-parte order without giving adequate & reasonable opportunity The Ld. CIT(A) has grossly erred in holding that appellant did not comply with the notices issued & he has further erred in passing the appellate order ex- The Ld. Lower authorities have grossly erred in making by way of prima facie Act, 1961. Reasons assigned for impugned addition are wrong & contrary to The intimation issued and upheld by the Ld. CIT(A) is void ab initio in view of decision of the Hon’ble Supreme Court in the case of cognizance for extension of Having regard to the facts of the case, the provisions of law & judicial propositions, impugned additions are the case are that the assessee is a public charitable trust and filed its return of income for the year under consideration on 27.03.2021, as against extended due date up to 15.02.2021, the relevant forms prescribed under the Income Tax . 10B in Form 10 in relation to accumulation of income were also not filed by the assessee before the due date of the filing of the return of income. Therefore, while processing the return tax Act, 1961 (in short ‘the Act’) Central Processing Centre (CPC) computed income of taxable without giving any benefit of the application of the income to the extent of 15% of the income accumulated or said part for specific purposes u/s 11(2) of the Act. On further appeal, in faceless appellate proceedings despite several notices issued no compliance was made by the assessee, the Ld. CIT(A) has reproduced a chart of the notices issued and non compliance on the part of the assessee on page 3 of the impugned order. The Ld. CIT(A) has thereafter upheld the disallowance by the CPC due to non-compliance of the filing of the prescribed form before the due date. The Ld. CIT(A) has also noted that condoning the delay in filing such forms has been delegated to the Commissioner of Income could be provided by him. 3. Before us, the Ld. Counsel of the assessee submitted that due to technical problems of computer software at the end of the assessee trust no compliance of the notices could be ma Counsel also submitted that it was a period of the and thus also no compliance could be made of the notices issued by the Ld. CIT(A). He submitted that the assessee is willing to co operate in proceedings before the Ld. CIT(A) an may be restored back for deciding afresh. 4. In our opinion since the appeal has been decided ex without taking into consideration the submission of the assessee and the assessee is willing to co substantial justice we feel it appropriate to restore this appeal back to the Ld. CIT(A) for deciding afresh after taking into consideration Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust peal, in faceless appellate proceedings despite several notices issued no compliance was made by the assessee, the Ld. CIT(A) has reproduced a chart of the notices issued and non compliance on the part of the assessee on page 3 of the impugned d. CIT(A) has thereafter upheld the disallowance by the compliance of the filing of the prescribed form before the due date. The Ld. CIT(A) has also noted that condoning the delay in filing such forms has been delegated to the f Income-tax Exemptions and therefore no relief could be provided by him. Before us, the Ld. Counsel of the assessee submitted that due to technical problems of computer software at the end of the assessee trust no compliance of the notices could be ma Counsel also submitted that it was a period of the Covid Pandemic and thus also no compliance could be made of the notices issued by the Ld. CIT(A). He submitted that the assessee is willing to co operate in proceedings before the Ld. CIT(A) and accordingly appeal may be restored back for deciding afresh. In our opinion since the appeal has been decided ex without taking into consideration the submission of the assessee and the assessee is willing to co-operate therefore in the interes substantial justice we feel it appropriate to restore this appeal back to the Ld. CIT(A) for deciding afresh after taking into consideration Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust 3 ITA No. 3202/M/2022 peal, in faceless appellate proceedings despite several notices issued no compliance was made by the assessee, the Ld. CIT(A) has reproduced a chart of the notices issued and non- compliance on the part of the assessee on page 3 of the impugned d. CIT(A) has thereafter upheld the disallowance by the compliance of the filing of the prescribed form before the due date. The Ld. CIT(A) has also noted that condoning the delay in filing such forms has been delegated to the tax Exemptions and therefore no relief Before us, the Ld. Counsel of the assessee submitted that due to technical problems of computer software at the end of the assessee trust no compliance of the notices could be made. The Ld. Covid Pandemic and thus also no compliance could be made of the notices issued by the Ld. CIT(A). He submitted that the assessee is willing to co- d accordingly appeal In our opinion since the appeal has been decided ex-parte without taking into consideration the submission of the assessee operate therefore in the interest of substantial justice we feel it appropriate to restore this appeal back to the Ld. CIT(A) for deciding afresh after taking into consideration submission of the assessee. The grounds of appeal are accordingly allowed for statistical purposes. 5. In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open Court on Sd/ (ABY T VARKEY JUDICIAL MEMBER Mumbai; Dated: 31/05/2023 Rahul Sharma, Sr. P.S. Copy of the Order forwarded to 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy// Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust submission of the assessee. The grounds of appeal are accordingly allowed for statistical purposes. result, the appeal filed by the assessee is allowed for nounced in the open Court on 31/05/2023. Sd/- Sd/ ABY T VARKEY) (OM PRAKASH KANT JUDICIAL MEMBER ACCOUNTANT MEMBER Copy of the Order forwarded to : BY ORDER, (Assistant Registrar) ITAT, Mumbai Smt. Dakuben Saremalji Sancheti Nadol Charitable Trust 4 ITA No. 3202/M/2022 submission of the assessee. The grounds of appeal are accordingly result, the appeal filed by the assessee is allowed for /05/2023. Sd/- OM PRAKASH KANT) ACCOUNTANT MEMBER BY ORDER, (Assistant Registrar) ITAT, Mumbai